THE SINGLE AVIATION MARKET OF AUSTRALIA AND NEW ZEALAND Jeffrey Goh LLB, PhD, Beaumont and Son (Solicitors), London formerly Lecturer in Law University of Sheffield Cavendish Publishing Limited London Sydney
CONTENTS Preface Table ofcases Table of Legislation and Agreements Table of Abbreviations INTRODUCTION v xiii xv xxi xxiii 1 REGIONALISATION AND THE SINGLE AVIATION MARKET 1 THE RE-EMERGENCE OF REGIONALEM 1 REGIONALISATION OF AIR TRANSPORT 4 THE SINGLE EUROPEAN AVIATION MARKET 11 The role of competition and the competition rules 14 The three packages of liberalisation measures 15 POLICY IMPERATIVESOFA SINGLE AVIATION MARKET 23 Harmonisation 24 Competition 24 Liberalisation 26 External relations policy 28 CONCLUSION 28 2 CLOSER ECONOMIC RELATIONS 31 BACKGROUND 31 CONTENT OF THE CERTA 32 Exemptions 33 Anti-trust regulation 34 Subsidies 35 PROGRESS OF THE CERTA 37 THE 1988 REVIEW AND THE SERVICES PROTOCOL 38 Scope of the protocol 39 Exceptions 40 THE 1992 REVIEW AND THE SINGLE AVIATION MARKET 41 3 THE SINGLE AVIATION MARKET 43 FORMALISING TRANS-TASMAN AIR SERVICES: THE AIR SERVICES AGREEMENT 1961 44 Ownership and control 45 Market access 47 Fares 47 Capacity 48 THE GENESIS OF THE SINGLE AVIATION MARKET: THE MEMORANDUM OF UNDERSTANDING1992 48 Cabotage rights 50 Fifth-freedom rights 51
The Single Aviation Market of Australia and New Zealand THE BREAKDOWN 52 THE RENEWAL 53 Market access 55 THE EFFECTS OF THE SAMANZ 56 THE UNRESOLVEDISSUES 56 External aviation 57 En Hoc negotiations 59 Air traffic distribution 61 Common competition policy 62 CONCLUSIONS 63 4 AVIATION POLICY REFORMS 65 DEREGULATION IN AUSTRALIA 65 Domestic Services 65 Qantas and domestic competition 70 Deregulation through the courts 72 International policy 75 DEREGULATION IN NEW ZEALAND 77 Domestic policy 77 International policy 83 5 REGULATING AIRLINE COMPETITION IN AUSTRALIA 87 THE STATUTORY FRAMEWORK 87 Re ACI Operations Pty Ltd 91 QANTAS-BRITISH AIRWAYS JOINT SERVICES AGREEMENT (1995) 92 RESTATED QANTAS-BRmSH AIRWAYS JOINT SERVICES AGREEMENT (2000) 94 Public benefit 95 THE ANSETT-AIR NEW ZEALAND-SINGAPORE AIRLINES ALLIANCE (1997) 100 Assessment of the effects on competition 101 Assessment of public benefits 102 Conclusion 105 CONCLUSION 105 6 REGULATING AIRLINE COMPETITION IN NEW ZEALAND 109 THE LEGAL AND INSTTTUTIONAL FRAMEWORK 109 AIRLINE COMPETITION REGULATION 115 AIR NEW ZEALAND-MT COOK GROUP 116 PRIVATISATIONOF AIR NEW ZEALAND 119 Epilogue 122 AIR NEW ZEALAND-ANSETT HOLDINGS 1 123
Contents Dominance in the relevant markets 125 Detrimental effects of the proposed acquisition 132 Public benefits 135 Conclusions 139 AIR NEW ZEALAND-ANSETT HOLDINGS 2 140 CONCLUSIONS 141 7 REGULATING COMPETITION IN THE SINGLE MARKET 143 PRINCIPAL DIFFERENCES 144 Market definition 144 Abuse of a dominant market position 145 Mergers and acquisitions 148 THE TRANS-TASMAN PROVISIONS 149 AN EMTEGRATED FRAMEWORK FOR TRANS-TASMAN COMPETLTION REGULATION 151 8 CONCLUSIONS: LOOKING TO THE FUTURE 155 APPENDICES 163 APPENDIX I INTERNATIONAL CIVIL AVIATION CONFERENCE (CHICAGO, 7 DECEMBER1944) 165 CONVENTION ON INTERNATIONAL CIVIL AVIATION 165 INTERNATIONAL AIR SERVICES TRANSIT AGREEMENT 169 INTERNATIONAL AIR TRANSPORT AGREEMENT 172 FREEDOMSOFTHEAIR 176 APPENDIX II 179 AUSTRALIA-NEW ZEALAND CLOSER ECONOMIC RELATIONSTRADE AGREEMENT 179 APPENDIX III 207 PROTOCOL TO THE AUSTRALIA-NEW ZEALAND CLOSER ECONOMIC RELATIONS TRADE AGREEMENT ON ACCELERATIONOFFREETRADEINGOODS 207 APPENDIX IV 213 PROTOCOL ON TRADE IN SERVICES TO THE AUSTRALIA-NEW ZEALAND CLOSER ECONOMIC RELATIONS TRADE AGREEMENT 213
The Single Aviation Market of Australia and New Zealand APPENDIX V 227 AGREEMENT BETWEEN THE GOVERNMENT OF THE COMMONWEALTH OF AUSTRALIA AND THE GOVERNMENT OF NEW ZEALAND RELATING TO AIR SERVICES 227 APPENDIX VI 235 AUSTRALIA- TRADE PRACTICESACT1974 235 APPENDIX VII 243 NEW ZEALAND-COMMERCEACT1986 243 APPENDIX VIII 249 AFRICA - YAMOUSSOUKRO DECLARATION ON A NEW AFRICAN AIR TRANSPORT POLICY 249 APPENDIX IX 255 THE ANDEAN COMMUNITY (COMUNIDAD ANDINA) - INTEGRATION OF AIR TRANSPORT IN THE ANDEAN SUBREGION 255 APPENDIX X 263 ASSOCIATION OF SOUTH-EAST ASIAN NATIONS (ASEAN) - INTEGRATED IMPLEMENTATION PROGRAMME FOR THE ASEAN PLAN OF ACTION IN TRANSPORT AND COMMUNICATIONS 263 APPENDIX XI 275 EUROPEAN COMMUNITY (EC) - TREATY ESTABLISKNG THE EUROPEAN COMMUNITY 275 Index 285