BREXIT: Future of UK Airlines Remain Uncertain

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Traditionally, aviation agreements have been negotiated on a bilateral basis between countries, regulating carriers rights to operate on new routes.
However, since the 1990s, the European Union has liberalised the aviation market and has taken a prominent role in negotiating aviation agreements among member states. Currently, any UK airline can operate to EU country without additional legislation process, but the situation will change after Brexit.
“Once the UK leaves the EU, and absent an agreement being put in place, those traffic rights would cease,” claims Sue Barham, Partner at law firm Holman Fenwick Willan.
Aviation experts claim the United Kingdom has three aviation regulatory options after the Brexit. The UK could remain a part of European Common Aviation Area (ECAA) like Norway, negotiate a separate Open Skies agreement with the EU like Switzerland or revert to bilateral agreements that were common before the liberalisation of the market.

Three Regulatory Options
Membership in the ECAA would provide the United Kingdom access to single aviation market, allowing conduct of flights as usual. However, this option requires acceptance of EU aviation laws and would limit freedom of the UK’s own aviation policy.
“A model based on the ECAA requires the UK to adopt and apply the suite of regulations, such as safety, economic, consumer protection, etc. by which it is currently bound,“ explained Sue Barham.
An alternative to membership of the ECAA would be a bilateral treaty between the UK and EU – similar to what Switzerland has – its air transport agreement regulates freedom of the movement between the parties.
“This option would preserve some policy freedom on UK-law makers, but the UK would have no influence over policy making in Brussels”, explains Anaelle Miriam, Corporate Communications Assistant at IATA.
Lastly, the UK could have a full freedom of discretion and negotiate bilateral agreements that would be limited to market access with member states. However, experts claim that the option is least likely to happen.
“There is simply too much EU regulation of aviation – most of which is beneficial and provides a cohesive, uniform system of international regulation – to unpick it all and try to revert to legislating on a national level,“ concludes Sue Barham.

No Decision Soon
However, the referendum has brought a large portion of uncertainty, therefore the government should consider, how much leverage the country wants to have in the new aviation treaties, as well as the timing of the signings.
“UK aviation will benefit from a timely solution which sets out clear positions. In this light, adopting a strategy of negotiating multiple bilateral arrangements may result in extending the uncertainty,“ says Keith Beattie, Partner at law firm Burges Salmon.
In theory, the UK will be able to start from the scratch when negotiating new arrangements. Perhaps, new treaties will be more advantageous to UK airlines? Law experts claim that the carriers may push the government towards an agreement that would benefit the airlines, rather than their customers.
One example is regarding consumer rights regulation. At the moment, carriers have to pay large amounts in compensations for flight delays. Sometimes, they do not have the control over the matter, but have to pay nevertheless, therefore UK airlines may push the government towards lower consumer rights protection regulation.
“It may be possible that UK airlines can benefit from a more relaxed regime in relation to consumer protection but it would be a bold political move for the government to push through weaker consumer protection in favor of the commercial positions of the airlines,” says Keith Beattie.
While the fate of the UK‘s aviation policy may be clouded, the near future does not suggest of any sudden changes.
“Until we negotiate the terms of our exit from the European Union and look at all of the detailed arrangements, we remain an EU member state with all of the rights and obligations and there will be no immediate changes,“ states Jack Griffith, Communications Director at UK‘s Department for Transport.

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