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EU to Seek Single Air-Traffic Agreement with US - 2003-06-05

The European Union has agreed to seek a single air-traffic rights pact with the United States.

Until now, airline routes between EU countries and the United States were negotiated on a bilateral basis, each EU country would negotiate individually with the United States. But following this decision, the European Commission will do the negotiating of behalf of all EU countries.

EU Transportation Commissioner Loyola de Palacio called the decision historic and a great boon for air travelers, as it is expected to result in a reduction in trans-Atlantic fares.

Ms. De Palacio said she intends to launch negotiations with the United States within a month on an agreement that will bring together the world's two largest aviation markets.

"It will open up new opportunities for consumers," she said. "It will allow for clearer competition [among] the airline companies, and it will breathe new life into this economic sector."

The European Commission believes the new agreement will help to consolidate ailing national airlines within the European Union. Under existing bilateral pacts, European airlines were afraid to merge, because they would lose flight rights in the United States.

Analysts say this was one of the factors that blocked British Airways and the Dutch carrier KLM from merging a few years ago. They would have lost the right to fly to the United States from the Netherlands, if the new company were declared to be British.

Minister De Palacio has said that over the next 10 years, she expects the number of large airlines in Europe to drop to as few as five.