November 20, 2018

No-deal contingency planning for the aviation sector

In the context of the current political uncertainty about the future of the proposed EU/UK Withdrawal Agreement, absence of approval for the proposed agreement remains a distinct possibility, and has perhaps become more likely. Therefore, the Communication published by the Commission on 13 November outlining from the EU side a contingency action plan in the event of a no-deal scenario is both timely and relevant.

The Communication is largely concerned with more general issues, but deals with certain specific sectors in some detail, including air transport. After suggesting that exit by the UK from the EU without a deal would lead to “abrupt interruptions of air traffic between the UK and the EU, due to the absence of traffic rights and/or the invalidity of the operating licence or of aviation safety certificates”, the Commission proposes three particular measures to alleviate the situation:

  • As regards traffic rights, the Commission “will propose measures to ensure that UK carriers are allowed to fly over the territory of the EU, make technical stops (eg, refuelling without embarkation/disembarkation of passengers), as well as land in the EU and fly back to the UK”, subject to reciprocal treatment of EU carriers by the UK.
  • As regards safety, the Commission will propose measures to ensure the continued validity of UK type certificates and organisation approvals for a limited period, subject to reciprocal treatment by the UK, and that parts and appliances placed on the EU market before the withdrawal date based on a certificate issued by a person certified by the UK CAA may still be used under certain circumstances.
  • As regards security, the Commission will take action to ensure that passengers and their cabin baggage flying from the UK and transiting through EU airports continue to be exempted from a second security screening at EU airports.

The Commission concludes by reminding carriers that wish to continue to be regarded as EU air carriers to take all necessary measures to ensure continued compliance with the requirement that they be majority owned and effectively controlled by EU nationals.

Our analysis

As this is the first positive statement the Commission has made about the air transport aspects of Brexit, it is to be welcomed, although it does not go as far as it could, and leaves a number of issues unresolved.

Traffic rights

The prediction of abrupt interruptions of air traffic due to the absence of traffic rights is alarming, and consistent with many of the scare stories that have been propagated by some media, but is probably unnecessarily pessimistic. Although the Commission does not mention them, most bilateral air service agreements between the UK and the other EU states are still legally in effect, although they have been largely overtaken by EU liberalisation, and hence dormant during the recent past. While some of these are in old-fashioned restrictive form, and would not give a legal basis for all current services, some (such as the agreement with the Netherlands) and more liberal and extensive, and should substantially do so. Furthermore, while it is preferable to have a firm legal basis for flights, it is likely that many existing services could be continued on a bilateral basis based on the informal principle of “comity and reciprocity”, as happened with services between France and the US in the years 1992-1996, when no bilateral between those two countries existed.

That said, it is welcome that the Commission proposes to confirm that existing 3rd and 4th freedom services between the UK and EU states (ie, carrying passengers from the UK to such states and back again) may continue - provided that is what the Commission means, as its statement is not entirely clear, in two respects. First, it uses the words “land and fly back”, without specifying the carriage of passengers, but this must surely be implied, as otherwise the phrase would make little sense in the context. Secondly, it is not specified that all such current services will be allowed to continue, although this appears to be the logical implication. The Commission’s proposal is, understandably, subject to a reciprocal approach on the UK side, but there should be no problem about this, as the UK made its basically liberal approach clear in the notice it issued in September.

It is gracious of the Commission to propose permission for overflight and landing for non-traffic purposes, but unnecessary, because these rights exist anyway, as a result of all EU states being party to the 1944 Two Freedoms Agreement.

Nothing is said about 7th and 9th freedom services, perhaps understandably, but serious issues arise that require consideration. It may be possible for UK licensed carriers to continue such services in and between other EU states by means of establishing another operating company, which satisfies the EU ownership and control requirements, in a continuing member state (and this is being attempted in at least one instance). However, 7th freedom services involving a point in the UK (of which there are many) could not be safeguarded in this manner, and the only solution for them would seem to be an agreement between the UK and the other state(s) concerned, or preferably the EU as a whole.

Safety

The Commission’s proposals on safety are also welcome, as far as they go, but they do not go very far, as they relate only to type certificates and organisation approvals, and parts and appliances, and say nothing about the many other similar certificates and licences that exist, such as individual certificates of airworthiness and pilots licences. However, as the UK pointed out in its September notice, such certificates and licences are also governed by the international Chicago Convention system, whereby they should be recognised by other states if they conform with ICAO standards, as is the case with the UK.

More fundamentally, no mention is made of any possible role for the UK in EASA, or even the commencement of discussions between EASA and the UK on the future relationship, which the Commission has up till now prohibited, despite this having potential negative implications for safety.

Security

In its September notice on security, the UK government pointed out that in this area the UK would be relatively unaffected, while EU airports would be put to considerable expense if they were to be forced to re-screen UK-originating passengers transiting through EU airports as a result of the Commission not recognising UK security standards as at least equivalent to EU standards (as the Commission had apparently been threatening). It appears that, in this respect at any rate, common sense has prevailed. However, the Commission says nothing about cargo security, although the UK’s notice also pointed out that there would be substantial issues that the EU would need to address to replace the current ACC3 clearances granted by the UK.

Owenership and control 

There is not a lot the Commission could helpfully say about this, as the requirement of EU majority ownership and effective control is the EU legal rule, and one could hardly expect the Commission to propose including the UK in the definition of EU for these purposes in the absence of a deal. However, it is beginning to become apparent that strict enforcement of the requirement could lead to significant problems for some EU airlines, and hence that a more constructive and original approach might be merited.