European Lawmakers Enact Airline Protections

The European Parliament today approved a bill that would impose duties on non-European air carriers deemed to be competing unfairly with European Community airlines. The governing body specifically cited "huge subsidies" from the U.S. government to U.S. carriers following the Sept. 11, 2001, attacks that have been "distorting the transatlantic market." The European Commission anticipated activation of the new regulations in the coming weeks. Should complaints by Community carriers result in action, duties imposed "will be calculated on the basis of the amount of aid granted to those airlines."

It is unclear how the bill will impact ongoing aviation treaty negotiations between European and U.S. regulators. In a statement following a European Council meeting this week, transport ministers said, "it would not be possible to conclude an agreement with the United States this year that would deliver the full objective of an Open Aviation Area." Though U.S. negotiators have agreed to raise the limit on foreign ownership of U.S. airlines to 49 percent, a principal sticking point remains market access for European carriers within the United States.