EU nations back deal with U.S. to boost trans-Atlantic flights

EU governments on Thursday backed a deal with the United States that should boost the number of people flying across the Atlantic by opening up restricted routes to new rivals - but delayed when the agreement will take effect.

The EU said its 27 nations had unanimously backed the deal, which will enter into force later than expected on March 30, 2008. European negotiators will now have to secure U.S. agreement to delay the pact, originally scheduled to take effect Oct. 28.

Britain effectively won its demand for extra time before opening up London Heathrow, the EU's busiest airport, to more carriers. Only four airlines British Airways PLC, Virgin Atlantic, American Airlines and United Airlines currently have the right to fly from Heathrow to the U.S., a lucrative route that represents around a third of all EU flights to the United States.

EU governments also set out how they could suspend the parts of the deal - curtailing U.S. airlines' new rights to fly anywhere they like in Europe if new talks don't win more concessions in the future.

"If no agreement is reached in 2010, each member state may - if it wishes - notify the (European) Commission of any particular rights they would like to suspend," said EU Transport Commissioner Jacques Barrot. "The idea behind this clause is to bring pressure to bear on the U.S. in order to conclude the second stage."

He said he did not think these sanctions would ever be put into practice because he believed that, by 2010, both the EU and U.S. would be moving toward total liberalization for aviation.

British Airways CEO Willie Walsh said Britain had to stand by its pledge to withdraw traffic rights if the U.S. did not open up to EU airlines. He claimed the EU had already given away its most valuable negotiating asset by opening up Heathrow.

"So far the U.S. has made no meaningful concessions," he said. "American carriers can now fly into Heathrow, Europe and beyond while their own backyard remains a no-go area for EU carriers and foreign ownership of their airlines remains unchanged."

The company said it would, nevertheless, move to Heathrow other London routes that get the most onward connections from people flying from the U.S. to London - mentioning the Houston route that serves the oil industry.

EU officials have repeatedly said they were disappointed with the U.S. failure to lift a rule that bars foreign investors from owning more than 25 percent of an airline's voting shares - the key precondition it set for a deal.

The Bush administration tried and failed to win support to scrap the rule amid worries from U.S. airlines and labor unions that this could threaten jobs and security.

The EU is pinning its hope on second-stage talks due to start next year

German Transport Minister Wolfgang Tiefensee, who led the talks, said the EU would have liked a more open trans-Atlantic aviation market.

"The EU continues to pursue this goal and today we have opened up the door for further negotiation, further progress," he told reporters.

Barrot, whose officials negotiated with the U.S., said the agreement benefits everyone involved and created a healthier aviation sector because it scraps many political barriers set up in bilateral treaties, reports AP.

"This agreement is a good agreement - it is good for passengers and good for airlines. It is good for the European Union and its individual member states, for the United States and for the entire trans-Atlantic economy," he said.

Environmentalists did not agree. The European Federation for Transport and Environment said more flights could completely negate other efforts to curb climate change and cut the amount of carbon dioxide released by aviation in coming years.