EU Proposals Aimed at Reforming Aviation Law

The European Commission has prepared several proposals to reform the Single Market legislation for aviation introduced some ten years ago which gave airlines unrestricted market access and permitted them to set fares independently.

The new proposals are intended to update some of the shortcomings of this legislation and ensure consistency among all EU member states.

“The liberalization of air transport is a European success story; citizens enjoy more travel opportunities and lower fares than ever before. We want to consolidate this success by removing all restrictions to the free provision of air services and ensuring fair competition between airlines,” said Jacques Barrot, EU commissioner of transport.

A key proposal addresses price transparency. While competition among the airlines has lowered fares considerably over the past decade, the low fares advertized often do not include taxes, surcharges and other fees. A practice that, the commission says, makes it difficult for consumers to compare prices.

“Citizens must enjoy the benefits of the Single Market and have the possibility for more choice and quality. They must be able to easily compare fares between airlines,” said Mr. Barrot.

The new proposal will ensure that airlines publish the full cost of the fare, with all charges included. In doing so it will also comply with the Unfair Commercial Practices Directive that requires all prices to include taxes by December 2007.

Another fare-related proposal puts an end to the variation in ticket prices for the same flight depending upon which EU member country the ticket is purchased.

Other proposals are aimed at tightening regulations on licensing airlines operating in the EU, and leasing aircraft from third countries. Airline companies will have to meet stricter requirements regarding their good financial standing and ownership to be licensed to operate in the EU.

Also, tighter controls will be placed on leasing fully crewed aircraft from companies that are not from EU member states. The intent of both these proposals is to ensure airline safety, and prevent either financial inadequacies or less-stringent standards to undermine safety.

Finally, another proposal is aimed at preventing governments from infringing upon free market competition to give national airlines advantages on flight service between the European Union and third countries.