Lexology - Air transport: Global overview
Market Insight 18 August 2022 18 August 2022
An international business needs international rules. Therefore, it is not surprising that international conventions provide a number of rules that apply to international air transport. That the need was recognised at an early stage is evident from the fact that the Warsaw Convention was signed in 1929 and the Chicago Convention in 1944.
This article was originally posted on Lexology.
The Warsaw Convention deals with the liability of air carriers in respect of carriage by air. It has been amended on several occasions and has recently been replaced to a large extent by the Montreal Convention 1999. The Chicago Convention is concerned with various aspects of air transport, particularly aircraft and the right to fly, and also established the International Civil Aviation Organization (ICAO). It provides the basis for the regulation of many areas of air transport. In addition, there are several international conventions about crimes on board or involving aircraft, and the Cape Town Convention 2001, which is relevant to aircraft financing.
Air transport is also highly regulated at a national level – principally from a safety point of view, but also from an economic point of view. Traditionally, access to the market and the behaviour of airlines in the market have been restricted and regulated, although there has been significant liberalisation recently, at least in some areas of the world. Somewhat paradoxically, as access to markets is liberalised and deregulated, it becomes more necessary to regulate behaviour in the market in other ways, particularly through competition laws, which have an increasing relevance for the air transport industry.
There is a third level of regulation, at regional level, most notably in the European Union (EU), where much has been done to break down national barriers and liberalise air transport on the one hand, and to harmonise conditions and introduce regulation intended to ensure that competition is not distorted on the other.