Virgin want ‘truly open skies’
12.05.08
Virgin Atlantic has warned European Union and US negotiators they must ‘unshackle’ the aviation industry, ahead of their latest round of talks this week, the Telegraph reports.
The meeting will be the first serious discussion between the two sides over the second phase of the ‘open skies’ deal, which liberalised the rights of EU and US airlines to fly between the two parts of the globe. However, ownership laws still prevent EU carriers acquiring their US rivals and vice versa.
European airlines can only acquire 25 percent of the voting rights in a US airline, while American airlines are limited to 49 percent. Airlines on both sides of the Atlantic are keen to see a change in the law, with consolidation seen as a way to combat expensive oil prices and weakening demand.
Paul Charles, a director at Virgin Atlantic, told the Telegraph: ‘The only open skies that make sense are truly open skies. The current system is full of regulation and red tape and we need to unshackle our industry.'
‘A car company like Ford can invest into the UK car market, yet airline carriers are restricted from investing in each other. This is a golden opportunity for lawmakers, but we expect it to take some time yet.'
'Aviation industry insiders' told the newspaper that they do not expect major progress to be made during the talks, although EU member states do have a concession to withdraw rights granted to Washington in the first phase of the agreement - including access to Heathrow - if the US refuses to liberalise its ownership rules and domestic market by 2010, so we expect some brinkmanship.
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