United
States, Asia-Pacific Aviation Partners Enter
Multilateral Open Skies Agreement
On
November 15, 2000, the U.S. Department of Transportation announced
that the United States and four of its aviation partners, in the
culmination of the first multilateral initiative specifically focused
on the comprehensive liberalization of aviation services, had reached
a multilateral Open-Skies agreement.
The
United States, Brunei, Chile, New Zealand and Singapore completed
the new multilateral “Open-Skies” agreement at a meeting of the
Asia-Pacific Economic Cooperation group in Brunei. The United States
has bilateral Open-Skies agreements with more than 50 aviation partners,
including the four countries joining it in the new multilateral
agreement. Open Skies permit unrestricted service by the airlines
of each side to, from and beyond the other’s territory, without
restrictions on where carriers fly, the number of flights they operate,
and the prices they charge. The agreement reached in Brunei provides
for similar liberalization for all flights among the five countries
for those countries’ carriers.
The
multilateral agreement will offer three important benefits:
- Provide
a Competition-Enhancing Model for Future Agreements: The multilateral
agreement mirrors the enormously successful U.S. Open-Skies
bilateral agreements, which permit unrestricted international
air service between the United States and each bilateral partner.
By expanding the Open-Skies model to the multinational level,
the new agreement helps set the terms for the global marketplace
and increases the odds that the U.S. Open-Skies approach will
become the international standard.
- Expand
Carrier Access to Equity Financing: Most bilateral agreements
require that substantial ownership of a given air carrier be
vested in either that carrier's homeland government or its nationals.
However, this requirement had made it difficult for many foreign
carriers, which lack access to large domestic capital markets,
to obtain cross-border financing. The multilateral agreement
substantially liberalizes the traditional ownership requirement,
thus enhancing foreign carriers' access to outside investment.
- Streamline
International Aviation Relations: Aviation is currently governed
by thousands of bilateral agreements between more than 180 countries.
The multilateral agreement will provide a single, streamlined
mechanism for broader exchanges of aviation opportunities. By
joining one multilateral agreement, countries can avoid prolonged
negotiation of numerous individual bilateral agreements.
The
official English text of the new agreement can be viewed at: http://www.maliat.govt.nz/
Revised
on
Monday, August 8, 2005
Content provided by Paul Gretch, Director
(202) 366-2423
