Explanatory Memorandum to COM(2018)893 - Common rules ensuring basic air connectivity with regard to the withdrawal of the United Kingdom from the Union - Main contents
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This page contains a limited version of this dossier in the EU Monitor.
| dossier | COM(2018)893 - Common rules ensuring basic air connectivity with regard to the withdrawal of the United Kingdom from the Union. |
|---|---|
| source | COM(2018)893  |
| date | 19-12-2018 |
1. CONTEXTOFTHE PROPOSAL
• Reasons for and objectives of the proposal
The United Kingdom submitted on 29 March 2017 the notification of its intention to withdraw from the Union pursuant to Article 50 of the Treaty on European Union. This means that, if the Withdrawal Agreement1 is not ratified, the Unions’ primary and secondary law will cease to apply to the United Kingdom from 30 March 2019 (‘the withdrawal date’). The United Kingdom will then become a third country.
International air transport cannot take place without the explicit consent of the States involved; this is a consequence of their complete and exclusive sovereignty over the air space above their territory. It is customary for States to organise air transport between them by means of bilateral Air Services Agreements (ASA) which lay down the specific rights mutually granted and the conditions of their exercise. Traffic rights and services directly related to their exercise are expressly excluded from the scope of the General Agreement on Trade in Services2.
Within the Union, the freedom for the Member States' air carriers (Union air carriers) to provide intra-EU air services exclusively stems from Regulation (EC) No 1008/2008 of the European Parliament and of the Council of 24 September 2008 on common rules for the operation of air services in the Community, which also lays down the rules for the licensing of those carriers.
In the absence of any provisions to the contrary in a withdrawal agreement, air services between the United Kingdom and the Member States would cease to be governed by the said Regulation upon withdrawal. Moreover, certain air carriers, by reason of their holding an operating licence issued by the United Kingdom, or their principal place of business being located in the United Kingdom, or their being majority owned or effectively controlled by the United Kingdom or its nationals, would cease to meet the conditions laid down in the said Regulation to qualify as Union carriers.
It follows that, in the absence of provisions to the contrary in a withdrawal agreement, as from 30 March 2019 there would be no legal basis for the provision of air services between the United Kingdom and the Member States by the respective carriers. The carriers in any of the situations described above would lose their Union operating licence and, as a consequence, no longer enjoy the right to provide intra-Union air services.
Direct air transport services between the United Kingdom and the Member States are almost entirely in the hands of United Kingdom and Union air carriers. The loss by those air carriers of their right to provide air services between the United Kingdom and the Member States would therefore result in serious disruption. Most, if not all, air routes between the Union and the United Kingdom would cease to be served. In contrast, intra-Union routes no longer served by United Kingdom carriers following withdrawal would remain fully accessible to Union carriers.
https://ec.europa.eu/commission/sites/beta-political/files/draft_withdrawal_agreement_0.pdf.
on 15 April 1994
In a no-deal scenario, it is expected that the consequences for the respective economies would be severe, as described further down: air travel time and costs would significantly increase as alternative routes are sought, and so would pressure on the air transport infrastructure within those alternative routes, while air transport demand would fall. As a result, not only the air transport sector, but also other sectors of the economy which are largely dependent on air transport would be hit. The resulting barriers to trade would hinder business in distant markets as well as business (re)location. The disruption of air transport connectivity would represent the loss of a strategic asset for the Union and the Member States.
In its Communication ‘Preparing for the withdrawal of the United Kingdom from the European Union on 30 March 2019: a Contingency Action Plan’ of 13 November 20183 the Commission announced its intention to propose measures to ensure that air carriers from the United Kingdom are allowed to fly over the territory of the European Union, make technical stops (e.g. refuelling without embarkation/disembarkation of passengers), as well as land in the European Union and fly back to the United Kingdom. Those measures would be subject to the condition that the United Kingdom applies equivalent measures to air carriers from the European Union.
The present proposal thus has the objective to lay down provisional measures to govern air transport between the Union and the United Kingdom following the latter's withdrawal from the Union (Article 1). These measures are intended to maintain basic connectivity for a short transitional period (Article 12).
In the first place (Article 3), the proposed Regulation provides for the unilateral grant of first, second, third and fourth freedom traffic rights to United Kingdom air carriers so that these can continue to overfly and make technical stops in Union's territory, as well as serve direct routes between the respective territories. No distinction is made between passenger and cargo operations, or scheduled and non-scheduled services. Consistent with the proposed Regulation's objective to ensure basic connectivity, the capacity which United Kingdom air carriers will be allowed to offer is frozen at pre-Brexit levels expressed in number of flights ("frequencies"). None of the usual operational flexibility devices (such as cooperative marketing arrangements, leasing of aircraft, change of gauge or co-terminalisation) have been foreseen for United Kingdom carriers to provide air services under the Regulation.
The rights granted to United Kingdom carriers being subject to a principle of “reciprocity”, the proposed Regulation (Article 4) lays down a mechanism to ensure that the rights enjoyed by Union carriers in the United Kingdom stay equivalent to those granted to UK carriers under the proposed Regulation. If that is not the case, the Commission is empowered to adopt the necessary measures to correct the situation by means of implementing acts, including the limitation or withdrawal of operating authorisations of United Kingdom air carriers. The assessment of the level of equivalence and the adoption of corrective measures by the Commission are not solely linked to strict, formal correspondence between the two legal orders; this is because of the marked differences between the respective markets and in order to avoid a blind mirroring approach - which might in the end prove counter to the Union interest.
Just as the Union strives to achieve in all its air services agreements, the proposed Regulation, even though it aims to temporarily ensure basic connectivity, lays down a flexible mechanism to ensure that Union air carriers enjoy fair and equal opportunities to compete with United
COM(2018) 880
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Kingdom carriers once the United Kingdom will no longer be bound by Union law. A level playing field requires that, even after the withdrawal, the United Kingdom continues to apply sufficiently high standards in the area of air transport as regards: fair competition including the regulation of cartels, abuse of dominant position and mergers; the prohibition of unjustified government subsidies; the protection of workers; the protection of the environment; safety and security. Moreover, it must be ensured that Union carriers are not discriminated against in the United Kingdom, be it de iure or de facto. The proposed regulation thus charges the Commission (Article 5) with the task to monitor the conditions of competition between Union and United Kingdom air carriers and empowers it to adopt the necessary measures, by means of implementing acts, to ensure that those conditions remain fulfilled at all times.
The necessary procedures are established so as to enable the Member States to verify that air carriers, aircraft and crews flying into their territories under this Regulation are licensed or certified by the United Kingdom in accordance with internationally recognised safety standards, that all relevant national and Union legislation is complied with and that the allowed rights are not exceeded (Articles 6 to 9).
Explicit provision is made to recall that Member States must not negotiate nor enter into any bilateral air services agreements with the United Kingdom on matters falling under the scope of this Regulation and that they must not otherwise grant UK carriers, in connection with air transport, any rights other than those granted in this Regulation. (Article 3). Nevertheless, the respective competent authorities will of course be able to cooperate as necessary for the good implementation of the Regulation (Article 10), so that the least possible disturbance is brought to the management of the air services that will continue to be provided under its aegis after the United Kingdom's withdrawal.
The European Council (Article 50) reiterated its call, on 13 December 2018, for work on preparedness at all levels for the consequences of the United Kingdom's withdrawal to be intensified, taking into account all possible outcomes. This act is part of a package of measures which the Commission is adopting in response to this call.
• Consistency with existing policy provisions in the policy area
This proposed Regulation is intended as a lex specialis that would address some of the consequences ensuing from the fact that Regulation (EC) No 1008/2008 will no longer apply to air transport between the United Kingdom and the remaining Member States as from the withdrawal of the United Kingdom and in the absence of a withdrawal agreement. The proposed terms are limited to what is necessary in this respect, so as to avoid disproportionate disruptions. They are intended to apply only for a limited period of time. This proposal is therefore fully consistent with the existing legislation and notably with Regulation (EC) No 1008/2008.
• Consistency with other Union policies
This proposal complements Union Regulation (EC) No 1008/2008. Although the approach followed in the Union's air transport agreements with third countries has been respected in some areas (e.g. operating authorisations), the specific purpose and context of this Regulation, as well as its unilateral nature, necessarily require a more restrictive approach in the grant of rights, as well as specific provisions intended to preserve equality of rights and a level playing field.
2. LEGALBASIS, SUBSIDIARITYAND PROPORTIONALITY
• Legal basis
The legal basis is Article 100(2) of the Treaty on the Functioning of the European Union (TFEU).
• Subsidiarity (for non-exclusive competence)
The proposed act would complement Union Regulation (EC) No 1008/2008, so that basic connectivity is ensured despite the fact that that Regulation will have ceased to apply in respect of the transport operations in question. Such connectivity would be ensured in an equal manner for traffic to and from all points in the Union, which avoids distortions in the internal market. Action is therefore indispensable at Union level and the result could not be achieved through action at Member-State level. .
• Proportionality
The proposed Regulation is considered proportionate as it is capable of avoiding disproportionate disruptions in a manner that also ensures equal conditions of competition for Union carriers It does not go beyond what it necessary to achieve this objective. This is the case, in particular, for the conditions under which the relevant rights are conferred, which inter alia pertain to the need that equivalent rights be conferred by the United Kingdom and to fair competition, and for the limitation of the regime in time.
Choice
of the instrument
Since the act governs matters closely related to Regulation (EC) No 1008/2008 and is intended, like this Regulation, to ensure fully harmonised conditions of competition, it should come in form of a Regulation. This form also best responds to the urgency of the situation/context, since the time available before the withdrawal (without a withdrawal agreement being concluded) is too short to allow for a transposition of provisions contained in a Directive.
3. RESULTS OF EX-POST EVALUATIONS, STAKEHOLDER
Contents
ANDIMPACTASSESSMENTS
• Ex-post evaluations/fitness checks of existing legislation
This is not applicable due to the exceptional, temporary and one-off nature of the event necessitating this proposal which does not relate to the objectives of existing legislation.
• Stakeholder consultations
The challenges arising from the United Kingdom's withdrawal from the EU and possible solutions have been raised by various aviation stakeholders and Member States representatives.
A common theme in the presented views was the need for a regulatory intervention in order to maintain a certain degree of air connectivity. When it comes to traffic rights, stakeholders are not able to take their own contingency measures in order to mitigate the harmful impact of the possible absence of a withdrawal agreement. At least six air carriers' and groups of air carriers' and airports' representatives (via mostly Airports Council International Europe) expressed the view that the status quo should be maintained with UK air carriers by keeping the same level of market access as before the withdrawal. However, other stakeholders
(mostly EU-27 air carriers' representatives) to the contrary highlighted that the status quo should not be maintained in the absence of full regulatory alignment, in order to ensure a level playing field in the market. On 12 June 2018, the Commission organised an EU-27 workshop on preparedness, during which Member States' civil aviation experts have in particular stressed the need to adopt EU level contingency measures in order to ensure basic connectivity between the EU-27 and the UK in case of an absence of a withdrawal agreement.
comments have been given due consideration on the preparation of the proposal.
• Collection and use of expertise
Several forms of assessment of the consequences of the United Kingdom's withdrawal for the air transport sector were shared with the Commission by relevant stakeholders. These assessments conclude that absence of air traffic between the EU-27 and the UK would cause significant disruptions in the EU-27. Air connectivity plays a crucial role within the wider economy. More than facilitating mobility, aviation is a strong driver of trade, growth and jobs. The direct contribution of aviation to the EU GDP is €110 billion, while the overall impact, including tourism, is as large as €510 billion through the multiplier effect4. In total, passengers travelling between the EU-27 and the UK represented 16% of all intra-EU traffic in 2016, although this figure varied significantly between EU Member States and can account for over 25%. Furthermore, in 2017, 19,3% of the intra-EU air transport was carried out by UK licenced air carriers, while 44,7 % of the traffic between the EU-27 and the UK was carried out by EU-27 licensed air carriers. Alternative transport options are available notably with rail and sea links but only for a small number of countries such as Belgium, France and Ireland. For other countries that are further away in the East and South of the Union, road and rail travel times make such not substitutable to air travel. Consequently, the significant damaging impact of the total loss of air connectivity on the EU-27 economy and citizens needs to be mitigated.
• Impact assessment
An impact assessment is not needed, due to the exceptional nature of the situation and limited needs of the period during which the change of status of the United Kingdom is implemented. No materially and legally different policy options are available other than the one proposed.
• Fundamental rights
This proposal has no consequence for the protection of fundamental rights.
4. BUDGETARYIMPLICATIONS
Not applicable.
5. OTHERELEMENTS
• Implementation plans and monitoring, evaluation and reporting arrangements
Not applicable.
Steer Davies Gleave – Study on employment and working conditions in air transport and airports: final report, 2015
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