Brussels, 11/05/2006 (Agence Europe) - The decision to sign an aviation agreement between the European Union and the USA, which seeks to create a “common Trans-Atlantic aviation area”, will not be taken this June but in October at the very earliest. This news was confirmed by Daniel Calleja (Head of the European Commission's Transport Directorate General) while addressing the press on 11 May, two days after consultation with the Vice Assistant of the US Secretary of State for Transport (DOT), John Byerly, who came to “explain” changes introduced by the (DOT) in his proposal to amend the implementation of the legislation by the US on rules governing ownership and control of US airlines.
The US Minister is facing a dilemma: either meet the expectations of the Europeans who want to sign an aviation “facilitation” agreement for accessing the capital of US airlines by European investors or go along with the US Congress, which refuses any modification to legislation on the subject due to reasons of national security. An initial proposal from the Department of Transport clashed with opposition from the US Congress, obliging it to amend it. Last week, the Minister therefore presented his new proposal. This will not amend the current rules on ownership and control of US airlines, which dates back to 1940 and which limits voting rights of foreign investors to 25% inside a US firm but it does now allow them to own up to 49% of the capital in a US airline. The majority of American investors in an airline company could delegate to foreign investors control over some commercial decisions, such as what aircraft to buy and sell or which routes to fly). The revised proposal would, however, guarantee American investors the right of veto on all decisions taken by a foreign shareholder. Additionally, it would re-affirm the total control of American investors of all decisions on safety, security and national defence.
Are these changes enough to content Europeans? Mr Calleja did not wish to prejudge the European Transport Ministers' decision, stressing that this was still not the final proposal because, in the United States, interested parties, including Congress, have 60 days to comment on the revised proposal. As soon as the final proposal has been put forward (meaning that the US Congress has not opposed it), the Commission will examine it in the light of three criteria: its clarity, its effectiveness (will it provide real prospects for European investors?) and its legal soundness, Mr Calleja explained. If the answer to these three questions is “yes”, then the Commission will issue EU Transport Ministers with a favourable recommendation.
At best, one can therefore hope that, during the October Transport Council, EU Transport Ministers will take the political decision to sign the agreement, which will then be sealed by both parties. The agreement will not be definitively applied until all parties concerned have ratified it but, in the meantime, it may be set in place provisionally on 25 March 2007, Mr Calleja said.