European Union–United States aviation agreements

SUMMARY OF:

WHAT IS THE AIM OF THE AGREEMENT AND THE DECISIONS?

The agreement provides for all transatlantic routes to be opened up to European Union (EU) and United States (US) airline companies. It has been amended by a Protocol in 2010 (see second-stage agreement).
It also includes an arrangement to develop the agreement further on matters such as airline ownership and control.
Decision 2007/339/EC and Decision (EU) 2020/1110 respectively mark the signing by the European Community and the approval by the EU of the agreement.

KEY POINTS

Market access: traffic rights and commercial/operational matters

The agreement allows EU airlines to:
- operate flights to the US from any EU airport, regardless of their place of establishment within the EU (community carrier concept);
- operate international routes between the EU and the US (third* and fourth* freedom rights), and routes beyond the EU and the US (fifth freedom rights*), without restrictions on the number of flights or type of aircraft;
- operate unlimited seventh freedom* cargo services (although there will be no additional seventh freedom all-cargo rights for US airlines on top of those previously granted by eight EU Member States);
- operate limited seventh freedom flights for passenger services between the US and any point in the European Common Aviation Area* (ECAA) although no such rights are given to the US airlines.
The agreement enables free pricing (although US carriers cannot set prices on EU routes within the EU) and contains detailed rules on franchising and branding to allow EU airlines to extend their network presence in the US market.
It also allows for unlimited code-sharing (where two or more airlines may share the same flight) and new opportunities for EU airlines to provide aircraft with crew (known as wet lease) to US airlines on international routes.

Market access: ownership and control

US airlines guarantee:
- permissible percentage ownership by EU nationals, including the possibility to exceed 50% of total equity;
- fair and expeditious consideration of transactions involving EU investment in US airlines.
EU airlines guarantee:
- the right to limit US investments in EU airlines to 25% of voting shares (mirroring the US system);
- acceptance by the US of any EU airline owned or controlled by EU or ECAA citizens.
Non-EU airlines guarantee:
- unilateral acceptance by the US of EU ownership and control of any airline in the European Economic Area, the ECAA and 18 African countries.
The joint committee that is established by the agreement has a role in matters concerning ownership and control.

Regulatory cooperation

The agreement also strengthens cooperation between the two parties in the following areas.

Security: working towards compatible practices and standards and minimising regulatory divergences in security measures.
Safety: improved consultation and cooperation in the event of safety concerns on either side.
Competition policy: commitment to cooperate in the application of competition regimes to agreements which have an impact on the transatlantic market and to promote compatible regulatory approaches to agreements.
Government subsidies: recognition that these may affect airlines’ ability to compete fairly and equally, and the need for arrangements allowing concerns about subsidies to be raised.
Environment: recognition of the importance of environmental protection and intentions for enhanced technical cooperation to reduce air transport emissions and improve fuel efficiency.

The agreement also includes a clear roadmap laying out a non-exhaustive list of ‘items of priority interest’ for the negotiation of a second-stage agreement.

Second-stage agreement

Further negotiations between the EU and the US were launched in 2008 and resulted in the signature of a second-stage agreement in 2010. This protocol builds on the first agreement and covers additional investment and market access opportunities. It also strengthens the framework for cooperation in regulatory areas such as safety, security, social aspects and particularly the environment, where both sides agreed on a dedicated joint statement on the environment.

Norway and Iceland acceded to the agreement in 2011.

DATE OF ENTRY INTO FORCE

The agreement entered into force on 29 June 2020. However, it has provisionally applied since 30 March 2008 (Article 25 of the Air Transport Agreement). The Protocol amending the Air Transport Agreement entered into force on 5 May 2022.

BACKGROUND

Prior to the 2007 agreement, air transport relations with the US were governed by bilateral agreements between Member States and the US. 16 Member States already had ‘open skies’ agreements in place. However, this fragmented approach proved to be an obstacle as it prevented the completion of a genuine single market.
In 2002, the Court of Justice of the European Union handed down judgments in cases referred to it by the European Commission (C-466/98, C-467/98, C468/98, C-469/98, C-472/98, C-475/98 and C-476/98). These clarified the sharing out of external powers between the EU and the Member States and clarified certain issues concerning freedom of establishment.
As a result, the Commission received an authorisation to negotiate an air agreement with the US that applied to the EU as a whole.
For further information, see:
- Freedoms of the air (International Civil Aviation Organisation).

KEY TERMS

Third freedom rights. In respect of scheduled international air services, the right or privilege, granted by one country to another, to put down, in the territory of the first country, traffic coming from the home country of the carrier.

Fourth freedom rights. In respect of scheduled international air services, the right or privilege, granted by one country to another, to take on, in the territory of the first country, traffic destined for the home country of the carrier.

Fifth freedom rights. In respect of scheduled international air services, the right or privilege, granted by one country to another, to put down and to take on, in the territory of the first country, traffic coming from or going to a non-EU country.

Seventh freedom. In respect of scheduled international air services, the right or privilege, granted by one country to another, of transporting traffic between the territory of the granting country and any non-EU country. This does not require the service to connect to or be an extension of any service to/from the home country of the carrier.

European Common Aviation Area. Includes the Member States, Albania, Bosnia and Herzegovina, Iceland, Kosovo*, Montenegro, North Macedonia, Norway and Serbia.

MAIN DOCUMENTS

Air Transport Agreement (OJ L 134, 25.5.2007, pp. 4–41).

Successive amendments to the Air Transport Agreement have been incorporated in the original text. This consolidated version is of documentary value only.

Decision 2007/339/EC of the Council and the Representatives of the Governments of the Member States of the European Union, meeting within the Council of 25 April 2007 on the signature and provisional application of the Air Transport Agreement between the European Community and its Member States, on the one hand, and the United States of America, on the other hand (OJ L 134, 25.5.2007, pp. 1–3).

Council Decision (EU) 2020/1110 of 23 January 2018 on the conclusion on behalf of the European Union of the Air Transport Agreement between the European Community and its Member States, of the one part, and the United States of America, of the other part (OJ L 244, 29.7.2020, pp. 6–7).

RELATED DOCUMENTS

Information concerning the entry into force of the Protocol to amend the Air Transport Agreement between the United States of America and the European Community and its Member States (OJ L 126, 29.4.2022, p. 1).

Information concerning the entry into force of the Air Transport Agreement between the European Community and its Member States, of the one part, and the United States of America, of the other part (OJ L 261, 11.8.2020, p. 1).

Decision 2011/708/EU of the Council and of the Representatives of the Governments of the Member States of the European Union, meeting within the Council of 16 June 2011 on the signing, on behalf of the Union, and provisional application of the Air Transport Agreement between the United States of America, of the first part, the European Union and its Member States, of the second part, Iceland, of the third part, and the Kingdom of Norway, of the fourth part; and on the signing, on behalf of the Union, and provisional application of the Ancillary Agreement between the European Union and its Member States, of the first part, Iceland, of the second part, and the Kingdom of Norway, of the third part, on the application of the Air Transport Agreement between the United States of America, of the first part, the European Union and its Member States, of the second part, Iceland, of the third part, and the Kingdom of Norway, of the fourth part (OJ L 283, 29.10.2011, pp. 1–2).

Decision 2010/465/EU of the Council and the Representatives of the Governments of the Member States of the European Union, meeting within the Council of 24 June 2010 on the signing and provisional application of the Protocol to Amend the Air Transport Agreement between the United States of America, of the one part, and the European Community and its Member States, of the other part (OJ L 223, 25.8.2010, pp. 1–2).

Protocol to amend the Air Transport Agreement between the United States of America and the European Community and its Member States, signed on 25 and 30 April 2007 (OJ L 223, 25.8.2010, pp. 3–19).

* This designation is without prejudice to positions on status, and is in line with UNSCR 1244/1999 and the ICJ Opinion on the Kosovo declaration of independence.

last update 06.05.2022