The EU Air Transport Market and its External Dimension

Transcription

1 The EU Air Transport Market and its External Dimension NOUVELLE LÉGISLATION Mr Carlos EUROPÉENNE Mestre and Mr Máté POUR Gergely ÉCONOMISER L ÉNERGIE Internal market, air transport agreements and multilateral relations Air Transport Directorate Directorate-General for Energy and Transport Améliorer European les Commission bâtiments Seminar on the EU Air Transport Market Department Speaker s name Istanbul, 21 November /11/2008

2 Who are we? Presentation of Directorate General for Energy and Transport (DG TREN) DG TREN, based in Brussels, reports to Mr Antonio Tajani, Vice-President of the European Commission, Commissioner for Transport and Mr Andris Piebalgs, Commissioner for Energy. DG TREN is headed by Mr Matthias Ruete, and has a staff of over 1000 in 10 Directorates located in Brussels and Luxembourg. In addition to the development of Community transport and energy policies, including dealing with state aid, the DG is responsible for managing the financial support programmes for the Trans-European Networks, technological development and innovation. 2

3 Who are we? Presentation of the Air Transport Directorate of DG TREN Air Transport Directorate (F) Mr Daniel Calleja Crespo Air Transport Directorate of DG TREN comprises 5 units. It is also in charge of relations with the European Aviation Safety Agency (F3) and SESAR Joint Undertaking (F2). Internal market, air transport agreements & multilateral Relations (F1) Mr Oliver Onidi Single sky & modernisation of air traffic control (F2) Mr Luc Tytgat Air safety (F3) Mr Roberto Salvarani Infrastructures and Airports (F4) Mr Rodrigo Vila de Benavent Aviation Security (F5) Mr Eckard Seebohm 3

4 The Single EU Aviation Market 4

5 The EU Today 27 Member States 490 Million Inhabitants One Single Market 5

6 The EU Single Market The territory of the 27 Member States represents one Single Market (in fact larger: NO, IC, CH) Freedom of establishment & provision of services Freedom of movement of goods, capital etc. No barriers to trade (technical harmonisation of standards) Firms have unrestricted access to nearly 500 million consumers Co-decision between Council and Parliament EU law has primacy over national law 6

7 EU Aviation Policy: A Brief History 1987: Start of air transport market liberalisation in EU 1992: Third aviation package establishes a Common Market for air services in EU 1997: Cabotage rights within EU 2002: European Aviation Safety Agency 2003: EU gains external competences in aviation policy 2004: Single European Sky 2008: Third Package updated 7

8 From National Air transport Markets to a Common Market Before 1987: national markets within the EU were protected and fragmented To fly between two major cities: little choice but to fly with one of the two national flag carriers (duopoly); Three successive packages of liberalisation measures ( ) have changed the landscape. World s largest and most successful example of regional market integration and liberalisation. 8

9 From National Air Transport Markets to a Single EU Market Results: Non-discriminatory air carrier licensing across Europe (from national to Community carriers with equal rights) Market access: no capacity restrictions Full cabotage since 1997 Free air fare setting Any Community carrier can now operate on any route within the EU Comprehensive body of Community legislation in relation to all key aspects of aviation 9

10 What Have We Achieved? Successes of the Single Market Tripling of air travel Doubling expected by 2020 IATA Forecast : +4.6% annual traffic growth for Europe Lower fares (LCC, more airlines, competition) and 10

11 What Have We Achieved? Successes of the Single Market more competition Number of Intra-EU27 routes with more than 2 carriers Intra-EU routes with more than 2 carriers have increased by 385% between 1992 and 2007 Routes and 11

12 What Have We Achieved? Successes of the Single Market more choice Number of Cross-border Intra-EU routes has increased by 220% ( ). Nbr of routes (city to city) Number of international Intra-EU27 routes Source: OAG schedules 12

13 What Have We Achieved? Successes of the Single Market lower fares Emergence of market for lowcost air services (nearly 30% of the whole market in 2006) Weekly seats available in EU27 by carrier type Incumbent Others Low cost Source: OAG schedules 13

14 Single Market Common Rules But open markets need coherent regulatory framework and common, non-discriminatory and transparent standards. 14

15 The EU regulatory framework for air transport 15

16 Key Objective Driving EU Policy: Ensuring Sustainability of the Sector s Growth Means: 1. Competitiveness of the industry Cost reductions and efficiency 2. Ensure safety and security 3. Avoid/reduce bottlenecks On the ground and in the air 4. Ensure environmental sustainability Comprehensive approach 5. Project success of the single market beyond Europe 16

17 The Air Service Regulation: Basis of the Single Aviation Market The Third Package regulations (2407/92; 2408/92; 2409/92) updated and replaced by Regulation 1008/2008: the Air Service Regulation Sets out the requirements for the granting and maintenance of the operating licences by the Member States (the concept of Community air carrier ). Open market access (including cabotage) for all Community air carriers Liberalisation of ownership and control requirements in the internal market Public service obligations on thin routes or to peripheral regions Procedures for traffic distribution between airports in an airport system Freedom to set passenger fares and cargo rates by air carriers 17

18 The EU ground-handling market.before 1996 closed market with limited competition and high prices.adoption of Directive 96/67 on access to the ground-handling market in Community airports.gradual market opening, focusing on the biggest airports ( > 2 million pax / tons cargo)» Freedom to provide «land-side» services» At least 2 providers of «air-side» services» At least one provider independent from the airport and main airline» Providers selected after open, public process» Airports to separate accounts if providing ground-handling.time limited restrictions on market opening possible in case of lack of space or capacity (and without prejudice to safety and security). Result: the introduction of competition at many airports which were previously closed and better value for money spent on ground-handling services.liberalisation of self-handling (but distinction between land-side and air side services) 18

19 EU aviation safety policy. Joint safety standards applied throughout the single market in a uniform way» Regulation, standardisation and enforcement. The European Aviation Safety Agency (EASA) was created to develop and implementation of EU rules in aviation safety» Originally responsible for airworthiness and environmental certification;» March 2008: extension of responsibilities to flight crew licensing, air operations and safety surveillance of third country aircraft» As a further step, the Commission proposed extend competences of EASA to safety regulation of airports and air traffic control. Learning from mistakes: accident investigation; incident and. occurrence reporting Community-wide list of un-safe airlines to protect EU citizens 19

20 EU aviation security policy. Prior to 9/ the EU had no legislative competence in the. field of aviation security Following the events of 9/11 the EU developed legislation on aviation security (on the basis of ECAC Doc. 30). The EU legislation applies to all airports in the EU. General requirements for security» single appropriate authority» national and EU inspections» national aviation security programme» national quality control programme» operator programmes.» member states may apply more stringent measures Revision of Reg. 2320/2002 enters into force in

21 The Single European Sky.In 2004 the EU adopted the first SES package to tackle the capacity challenge, enhance safety and reduce costs of ATM:» Separation of service provision and regulation (NSA)» Certification of ANSP, interoperability, civil-military cooperation, airspace reorganization, licensing of controllers, common charging scheme» Consultation with stakeholders through Industry Consultation Body» Technical expertise of Eurocontrol (mandates).eu ATM system still suffering from fragmentation, lack of performance driven approach and outdated technologies capacity crunch expected by 2020;.SES II package presented in June 2008 to:» Improve environmental performance» Restructure the European airspace as a function of traffic flows, no longer according to national borders, thus avoiding fragmentation» Improve safety capacity and cost efficiency» Deliver SESAR 21

22 SESAR (SES ATM Research). Technological/industrial complement of the SES legislation A single ATM R&D programme in Europe developed jointly by the EU, Eurocontrol and private industry (2,1 B ). Objectives of the project:» Increase safety by a factor of 10,» Triple capacity,» Reduce ATM costs by 50%,» 10% reduction of environmental impact per flight.. Definition phase: ATM master plan Development phase: to be managed by SESAR Joint. Undertaking (JU) SESAR JU open for participation of third countries 22

23 Optimisation of the airport capacity Slot co-ordination and schedules facilitation. At congested airports slot allocation should be in conformity with the EC Regulation 95/93: schedule facilitated or. coordinated airports if necessary; Allocation of slots on the basis of neutral, transparent and non-discriminatory rules by an independent slot. coordinator; Capacity situation at airports should be subject to analysis. and consultation in particular with the airport users Allocated slots have to be used for at least 80 % ( rule ); unused slots return to the pool Allocation twice each year: summer season + winter season 23

24 Common insurance requirements for air carriers and aircraft operators.regulation 785/2004 on insurance requirements for air carriers and aircraft operators;.minimum insurance requirements to cover aviation-specific liability;.applies to aircraft operating in the airspace of an EU Member State and both to Community and non-community carriers;.minimum insurance requirements:» SDRs per passenger» For baggage, 1000 SDRs per passenger» 17 SDRs per kilogram cargo» Third party liability insurance based on the MTOM of the aircraft.liability in respect of air carriage governed by the Montréal Convention (in the EU extended to domestic flights by Regulation 2027/97 on air carrier liability in the event of accidents);.third party liability governed normally by national law of the Member States (but works on the Revision of the Rome Convention of 1952 in progress under ICAO auspices) 24

25 Passenger rights in the Single Aviation Market.. Since February 2004 air passengers benefit from a common set of rights when flying on Community airlines; Regulation EC 261/2004 applies in situation of denied boarding,. cancellations, long delays and involuntary downgrading of travel class; Depending on the circumstances, the airlines are required to:» provide passengers with assistance such as accommodation, refreshments, meals and communication facilities;» offer re-routing and refunds;» pay compensation of up to 600 per passenger; and» proactively inform passengers about their rights under the Regulation.Each Member State is obliged to establish a National Enforcement Body and a system of sanctions to ensure that the Regulation is effectively implemented and rights of passengers protected 25

26 Sustainable Development: Aviation and Environment. It is true that air transport Co2 emissions represent under 3%. on global Co2 emissions but they are growing fast. It is true that industry is already doing a lot.. Indeed: 70% fuel efficiency improvement over past 40 years But this will unfortunately not be enough to maintain the. sustainability of the sector s growth! Tackling climate change is urgent, every economic sector has to contribute, including aviation 26

27 Sustainable Development Aviation and Environment Comprehensive EU approach:.single European Sky and SESAR (10% emissions reductions per flight).transatlantic AIRE initiative.research and Development 7th Framework Program ( Clean Sky, Green Aircraft, alternative fuels etc.).market-based measures (with a clear preference for ETS because it allows aviation to grow!).eu supports global approach, we are ready to discuss with third countries (within ICAO (GIACC), within UNFCCC, on a bilateral/regional basis) The real challenge is to reach global agreement at the international level. 27

28 Expanding Commercial Opportunities Outside Europe: Three Pillars 28

29 International Air Services Agreements Air traffic between two states is traditionally governed by restrictive bilateral air services agreements (ASAs) Restrictions on: How many and which carriers may fly? How many weekly flights (frequencies)? To which cities/airports? Open Skies agreements - liberalised market access but national ownership Open/Common Aviation Areas full liberalisation, ownership normalisation and regulatory convergence 29

30 Open Skies Judgements of the European Court of Justice The European Court of Justice found on 5 November 2002 that the bilateral air services agreements between eight EU Member States and the USA were not in conformity with EC law. The nationality clauses in all agreements infringe the right of establishment (Art. 43 EC Treaty) as they are discriminating on grounds of nationality. The agreements infringe the exclusive external competence of the EU. In areas where EC legislation affects third countries, only the EU can enter into international commitments. 30

31 EU External Aviation Policy Post-ECJ Judgement The Single EU Aviation Market has an external dimension June 2003 package: Mandate to negotiate a Comprehensive agreement with the US Horizontal Mandate Regulation (847/2004) on the negotiation and implementation of air service agreements between EU Member States and third countries Road-map for EU external aviation relations adopted by the Council of EU Transport Ministers in June

32 Guiding Principles in EU External Aviation Relations Relations must be based on agreements that respect Community law. If not: Agreements vulnerable to legal challenge Uncertainty for commercial operators Level playing field allowing all airlines to compete on a fair and equal basis Regulatory convergence 32

33 The Three Pillars of the External Dimension I. Bringing existing bilateral agreements into line with Community law II. The creation of a Common Aviation Area with neighbouring countries III. Conclusion of ambitious global agreements with key partners 33

34 Community Designation Objective: To allow EU carriers to benefit from the right of establishment within the EU, including non-discriminatory access to air routes to third countries. New clause: Any EU Member State can designate any licensed EU carrier with an establishment in its territory (subject to available traffic rights). 34

35 Pillar I: Progress on the Legal Issue 97 non-eu states have accepted Community designation Nearly 800 Bilateral ASAs have been brought into conformity with Community law 38 Horizontal Agreements covering 650 ASAs (since September 2004) Negotiations/talks on-going with many countries 35

36 What IS the purpose of a Horizontal Agreement? Agreement between the EU and a third country Ensuring legal certainty for all bilateral Air Service Agreements (ASAs) between EU Member States and that third country To be negotiated by the European Commission under its Horizontal Mandate A first step to develop further cooperation on aviation matters 36

37 What is NOT a Horizontal Agreement? NOT a traditional bilateral Air Service Agreement (does, for example, not deal with or affect traffic rights) NOT a comprehensive Air Transport Agreement between the EU and a third country (unlike, for example, the EU-US Agreement) NOT a multilateral agreement NOT replacing but amending (and protecting!) bilateral Air Service Agreements between EU Member States and a third country 37

38 Pillar II: Comprehensive Agreements With key and like-minded partners Aim: to normalise aviation by: market opening removing investment barriers regulatory convergence First: EU-US Agreement (1 st stage) Signed in April 2007 Applicable as of 30 March 2008 Second phase negotiations ongoing since May 2008 Next: Canada (negotiations on-going), Australia, New Zealand 38

39 Pillar III: Common Aviation Area with the Neighbouring Countries. An offer for neighboring countries to participate in a pan-european CAA through the application of the same legislation and extension of the EU internal air transport market;. Fits into broader objectives of the ENP:» Countries with strong political and economic relations with the EU» Priority for countries already participating in the Pan European aviation organisations and having strong aviation relations with the EU. Not only market access but also common rules and standards to ensure high, uniform levels of aviation safety, security, efficiency of infrastructure, protection of consumers, competition and environment;. Possibility for association with the EC aviation structures and programmes 39 (like Single Sky Committee, SESAR, EASA etc.);

40 Common Aviation Area with the Neighbouring Countries by 2010?? progress made Southern and Eastern neighbouring countries Pre-accession context: Western Balkans (ECAA) ECAA Agreement signed in June 2006 (Gradual liberalisation and market integration in function of degree of regulatory convergence achieved) Morocco (Euro-Mediterranean agreement) EU-Morocco Agreement signed in December 2006 Negotiations ongoing with Ukraine, Jordan, Israel Next: Tunisia, Algeria Ambition: Towards a single market of more than 50 states and 1 billion inhabitants 40

41 Aviation in the Europe of Tomorrow: A Wider Common Aviation Area 58 States Approx. 1 Billion inhabitants 41

42 Text Common + picture Aviation slide Area opportunities. Basing Participation New. Cross More More. Increased Benefiting. Benefiting air transport industry on high level, uniform standards and regulations that successfully passed a test in practice;.select and throw away the current photo in the EC aviation structures and/or programmes;» Insert your new photo market opportunities for air carriers and supporting services;» Double-click on it, choose: border mergers more probable with the liberalisation of O&C size/height/9.13/ok competition and lower fares benefiting the travelling public and businesses» Put the photo in the right bottom corner Right-click on it and select Order/in Background Then adjust the position possibilities for airports to develop into regional hubs; regional cohesion and tourism development; from the EC external air transport policy (recent example of additional traffic rights form the ECAA countries to the US); from enhanced technical assistance and EU expertise (especially in the transitional periods) NOUVELLE LÉGISLATION EUROPÉENNE POUR ÉCONOMISER L ÉNERGIE 42 42

43 Text Common + picture Aviation slide Area challenges.adapting to the new regulatory environment costs of compliance,.select training etc. and throw away the current photo» Insert your new photo competition» Double-click on it, choose: size/height/9.13/ok growth» Put the photo in the right bottom corner.flag carriers may need to restructure to successfully face the increased.provision of the necessary infrastructure to accommodate the traffic Right-click on it and select Order/in Background Then adjust the position.increased workload for the Civil Aviation Authorities (regulatory work, oversight etc.).first and foremost, the need to demonstrate that a Partner Country can maintain in a sustainable way a high level of aviation safety and security in line with international standards need to focus resources and efforts. NOUVELLE LÉGISLATION EUROPÉENNE POUR ÉCONOMISER L ÉNERGIE 43 43

44 Text CAA + agreements: picture slide a flexible, proved formula.select and throw away the current photo» Insert your new photo» Double-click 1999 Community on - Switzerland it, choose: Air Transport size/height/9.13/ok Agreement» Put the photo in the right bottom corner In the sector of aviation:» 1992 EEA Agreement (Norway, Iceland, Liechtenstein)» Earlier negotiations on an ECAA with the 10 new EU Member States (model accepted by the European Court of Justice) Right-click on it and select Order/in Background Then adjust the position In the energy sector:» South-East Europe Common Energy Treaty NOUVELLE LÉGISLATION EUROPÉENNE POUR ÉCONOMISER L ÉNERGIE 44 44

45 Text CAA + agreements: picture slide a flexible, proved formula. Is. Is. How.Select it a take it or and leave throw it offer? away the current photo - There are two basic concepts (Single Aviation Market concept and Euro-» Insert your new photo Mediterranean Aviation Agreement concept) but no template for CAA» Double-click on it, choose: given situation. size/height/9.13/ok it» possible Put to the implement photo CAA in agreements the right in bottom a gradual way corner? agreements. Each is negotiated individually and tailored to the specificity of the - Yes. Implementation of the CAA agreements can be a challenging task and gradual/phased approach is necessary. Transitional arrangements are defined by both sides to give both industry and regulators time to adjust (but no derogation from common rules in the end). Right-click on it and select Order/in Background Then adjust the position CAA agreement are administered? - CAA agreements have their own administrative structure. Both the Community and the partner countries are hosting and managing the agreement together through participation in the Joint Committee (established in EEA, ECAA and Morocco agreements). NOUVELLE LÉGISLATION EUROPÉENNE POUR ÉCONOMISER L ÉNERGIE 45 45

46 Example of the European Common Aviation Area (ECAA) Agreement. Multilateral Aviation Agreement signed in June Creates a common area for aviation through:» application of the same legislation and» extension of the EU internal air transport market. Covers 37 parties with more than 500 million people. Pre-accession instrument in a key sector 46

47 Example of the European Common Aviation Area (ECAA) Agreement. Contracting Parties:» The European Community and its Member States» Norway, Iceland» The Western Balkans Partners: Albania, Bosnia and Herzegovina, Croatia, the former Yugoslav Republic of Macedonia, Montenegro, Serbia, Kosovo 47

48 Example of the European Common Aviation Area (ECAA) Agreement. The EU aviation legislation is the basis of the agreement (list of acquis in Annex I). The EU aviation legislation becomes applicable throughout the European Common Aviation Area i.e. the Western Balkans Partners will also implement it (pre-accession context). Transitional arrangements defined for each of the Partners (country specific annexes, allowing for implementation at own speed)» Gradual market opening, and implementation of the EU acquis» Association with the EU institutional framework (Single Sky Committee, EASA). Progress monitored through periodic assessment visits and reports to the Joint Committee. Support through technical assistance 48

49 ECAA - Structure of the Agreement. Main text: objectives, principles, functioning, future developments etc.. Annex I: list of EU aviation legislation which becomes applicable. Protocols: one per ECAA partner, setting out transitional measures 49

50 Result: gradual increase in market access One protocol per ECAA partner Transition: yes, derogation: no Gradual opening of markets subject to implementation of EU legislation (3 phases) Liberalisation of 3rd and 4th freedom upon application of the agreement Liberalisation of 5th freedom in phase 2 Full liberalisation in phase 3 (cabotage) 50

51 Example of the European Common Aviation Area (ECAA) Agreement.The world s largest single air transport market further extended.the same high technical standards to be applied (safety, security, ATM) with EU technical assistance.part of Common Aviation Area to be established by 2010.Pre-accession instrument 51

52 Joining the Common Aviation Area Conclusions. An offer of the EU for the neighbouring countries to join the single aviation market and base air transport industry on. high level standards tested in practice; Offering significant benefits for consumers, regional development, and modernisation of the air transport. industry An excellent test case before further economic integration. with the EU Giving possibility to be associated with the EU institutional and/or operational framework in aviation. Possibility for gradual approach and transitional phases Implementation supported by technical assistance 52

53 Thank you for your attention! Vielen Dank fuer Ihre Aufmerksamkeit!