U.S., India, EU Discuss Relaxing Rules on Airline Ownership

The U.S., India, the European Union and a dozen other countries are exploring ways to liberalize the aviation industry after a weekend summit meeting in Istanbul organized by the International Air Transport Association.
Senior aviation officials from Australia, Brazil, Canada, Chile, Mauritius, Morocco, Panama, Singapore, Switzerland, Turkey and Vietnam were among those assessing regulations on airline competition and ownership with a view toward easing restrictions, said Jeff Shane, an aviation lawyer and former undersecretary for the U.S. Transportation Department, who chaired the meeting. He spoke in a teleconference.
International air traffic is governed by about 3,500 bilateral air treaties that dictate where carriers can fly and how many times a day, how many airlines may fly from a given country, and who must own the airline, Shane said. While many treaties have been updated since the framework was set up after World War II, restrictions on aviation are still tighter than those governing other global industries, Shane said.
By allowing capital to flow more freely within the industry, the airline business would be stronger and better able to cope with difficult periods such as the current one, Shane said. By allowing more competition, consumers would also be better served, he said. Today, for the most part, international carriers may not carry passengers across international lines unless the plane leaves from and ends up in the country in which that carrier is based.
25/10/08 Andrea Rothman/Bloomberg

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Categories: Foreign Oct 2008, Indian Aviation- In General Oct 2008