Wall Street Journal: Easy to Convict Open Skies But Not Close

Airlines of the USA and eight European countries won’t join fair competition?

It's probably too early for champions of free and fair competition (including those in the PRAVDA.Ru editorial office) to be happy. Certainly the European Commission and the European Court have the right to declare the bilateral “open skies” agreement between the USA and eight European countries illegal. And the latter, in their turn, aren’t going to give up advantages of unfair competition. Isn’t the European justice in the know when it concerns big money?

Yesterday, America’s Wall Street Journal commented upon the European Court decision to declare the “open skies” agreements illegal rather skeptically. And to all appearances, there are enough reasons for this. The newspaper quotes European Commission press-secretary Gilles Gentelet as saying that it may take either two months or five years to realize decisions of the supreme court body of the European Union. And it is not ruled out that it may take even more. And within this whole period the US air carriers will be enjoying an incontestable advantage over the airlines of the eight European partners in the “open skies” agreement. And the latter in their turn will have considerable advantages over the rest European Union members and the rest of the world as concerning air transportation in the USA.

It was the European Commission that was the first to draw attention of the European Court to the fact that the bilateral exclusive transport agreements of eight EU members hampered free market competition on the US market of passenger and freight air traffic. This happened in 1998. But the European Court passed its decision on the problem only now. The European justice is obviously making no haste about such problems at all.

Meanwhile, the European Court passed a decision saying that airlines of Austria, Belgium, Denmark, Finland, Germany, Luxemburg, Sweden and Great Britain infringed upon the EU regulations. First, they all together had established knowingly noncompetitive tariffs for flights inside the European Union; second, they deliberately infringed upon the airlines based outside their homeland for the sake of their own advantage. But the EU regulations categorically rule it out.

The European Court decreed that none of the EU members could conclude agreements with the USA which would infringe upon the rights of airlines located in other EU countries. European lawyers think that such agreements can be concluded only on behalf of the whole of the European Union and in favor of all EU members only.

According to Wall Street Journal, EU Transport Commissioner Loyala de Palacio thinks this court decision is a historic step toward uniting the whole authority in Brussels and supposes that it will touch upon about a dozen of European airlines. British member of the European Parliament Brian Simpson supports the opinion and adds that the European unified market should provide conditions for fair competition. Sounds rather nice, gentlemen.

However, words are one thing and real mechanisms for realization of court decisions are quite another thing. EU press-secretary Gilles Gentelet is sure that it may take several years to change the transatlantic air routes. Making of a final decision on the problem depends upon all EU members. The European Commission will certainly insist that EU members should authorize it for negotiating the problem with the USA on behalf of the European Commission. However, according to the European laws in force, the European Commission doesn’t have such rights. To tell the truth, it may turn out that more influential EU members who currently have an obviously noncompetitive exclusive with regard to air transportation in the USA, won’t like the European Commission interfere with their transport relations with the USA. As the saying goes, a united Europe is good, but money in your own pocket is even better.

On the whole, there is nothing which may hamper the EU countries to independently review their “open skies” agreements with the USA in  the light of the European Court’s recent decisions. But at that they will probably find other convenient ways to infringe upon the rights of other members of the air traffic market. This is because it was obvious from the very beginning that airlines of the USA and the eight mentioned EU members weren’t going, and wouldn’t in the future as well, to compete with other airlines of the EU and of the world on equal terms. They still want to be, as Orwell said right to the point, “more equal than other animals.”  And the European Court with its turtle slowness and years-long bureaucracy procedures is no serious hindrance to it at all.

In the light of the mentioned above facts, it sounds really very naive when Russian top officials demand that Russia should be incorporated into the WTO on “general” rules. And subsequent complaints of Russian negotiators on the double standards and insincerity of WTO’s European members. It’s very likely that no general rules for everyone exist at all. Evidently, developed countries of the West are still colonizers deep inside, even despite their present-day humanitarian and politically correct look. And they believe that they “were and will always be more equal than other animals.” And that is why all the rest must be in unfavorable conditions a priori.

Kira Poznakhirko

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Author`s name Michael Simpson