Securing the best deal for the UK’s aviation industry following Brexit is a “priority right now”, Chris Grayling, the UK’s secretary of state for transport, has said, although lawyers who spoke to GTDT Aviation Law News have queried how and if this can be achieved.
Speaking at the Airlines UK Annual Dinner last week, Grayling said he would push for a new and comprehensive free trade agreement that gives the UK’s airlines the best possible access to the single market.
“We also want the best possible access to European aviation markets. We believe it is in the EU’s interests to seek a liberal arrangement for aviation. So that airlines can offer connectivity and passengers have choice,” he said.
“Of course, the ultimate outcome for airlines – as for all areas of the economy – will have to await the conclusion of negotiations. Yet as discussions with the EU proceed, I am confident that we will get what we need. The fact remains that other countries want to do business with us... And those nations want to do business with British airlines too.”
Ahead of Brexit negotiations, the starting position of the UK aviation industry is one of great strength, he added, because it is the largest aviation network in Europe.
“As the world increasingly embraces aviation in the coming decades, in return, aviation will increasingly drive the globalisation of trade and commerce. Few other industries can predict future demand with such certainty. So what we have to do – together – is make sure our aviation industry is ready to play its part in that growth,” he said.
Lawyers who spoke to GTDT Aviation Law News greeted Grayling’s speech with mixed sentiments.
“It is good to see that aviation is now being addressed by ministers [as part of the Brexit debate] and I’m pleased to see that he is being so optimistic. I question whether this is achievable or not though,” said Tom van der Wijngaart at Clyde & Co in London.
“The best possible access to aviation markets is the status quo: completely unrestricted access to the market within the European Economic Area for any license holder. Unless we can replicate that, which perhaps seems unlikely in the context of a hard Brexit, anything else will be a lesser form of liberalisation than what we have now.”
The UK aviation industry feels strongly that the seventh and ninth freedoms of the air must be protected, without any pricing restrictions, van der Wijngaart said, ensuring that UK airlines can continue operating flights within the EU and within individual member states without connecting back to the UK.
“Those are very profitable routes for UK carriers and in a typical bilateral negotiation for traffic rights, those are the most jealously guarded. Currently we have full access to that,” he said.
“The worst-case scenario would be reverting to a position where the UK’s aviation relationship with Europe is based on restricted bilateral agreements. That would be almost like stepping back to the 1970s, where we only had third and fourth freedom rights, with a limited number of airports that each carrier can fly to and a limited number of carriers that can operate under that bilateral. That would be fairly disastrous.”
Anna Anatolitou, a partner at Ince & Co in London, said she is hopeful about a favourable deal for the UK, but warned against complacency.
“I am relatively optimistic given that the UK is such a powerful player in the global aviation industry, but we cannot underestimate the potential for a protectionist approach by other EU member states,” she said.
“We must ensure that UK carriers maintain access to the EU market and that other carriers – both EU and non-EU – have easy access to the UK market. There is precedent for this if we look at other non-EU countries, such as Norway and Switzerland. Ideally, the UK should seek to maintain European Common Aviation Area membership.”
Grayling also confirmed that the UK government is working on a new aviation strategy, which will affect airports, safety, security, competitiveness, consumers, regulation and capacity, and is planning to launch a consultation on measures to modernise UK airspace infrastructure.
“Like much of the rest of our infrastructure, it is increasingly congested and modernisation is overdue. While modern aircraft are fitted with the latest satellite navigation technology, most of our airspace arrangements are half a century old,” he said.
“That is why I am determined to address this challenge. We will shortly be launching a consultation on measures to support airspace modernisation. These measures will provide for the use of modern technology. To reduce delays, cut noise for local communities, and lower carbon emissions.”
Ahead of the speech by Grayling, Jane Middleton, chair of Airlines UK, a trade group that represents the country’s registered airlines, said: “The UK and the EU have been leaders in opening up the air transport market, so we are looking to government and its European counterparts to secure a deal safeguarding international market access for both sides. So far we have been encouraged by the dialogue and engagement we have had with government since the vote in June.”