UK Operators Stalled by Brexit Blocks on Market Access

 - January 8, 2021, 6:30 AM

The UK business aviation sector is facing significant disruption as it waits for negotiations to be concluded with European Union (EU) countries over market access and other regulatory issues. In the first week since the end of the December 31 end of the transition period for the country’s Brexit departure from the EU, aircraft operators have complained of costly and time-consuming obstacles to getting clearance for commercial flights.

The British Business and General Aviation Association (BBGA) met with officials from the Department for Transport (DfT) and the Civil Aviation Authority (CAA) on January 6 to discuss the need to advance bilateral negotiations that now need to be conducted with each of 27 EU member states. UK operators are finding that "freedom of the skies" rights supposedly covered by the air transport sections of the EU-UK Trade and Cooperation Agreement implemented at the end of the transition period (see pages 221-245 of the agreement) are now not being automatically granted in other countries.

The UK has offered to allow EU operators to continue exercising third and fourth freedom rights allowing flights to and from the UK for a two-year transition period. Fifth freedom rights, allowing flights within another country or onwards to another EU state, are only now permitted for UK operators carrying cargo.

According to BBGA chief executive Marc Bailey, several EU member states are not reciprocating this offer of extended rights. Some of these states now make UK operators apply for permits for each and every flight, requiring an initial €4,000 ($4,440) fee, 48 hours notice, extensive security details, and getting permission from all other operators in that country. “Disappointingly, their approach has not created the expected level playing field we believed were simple third and fourth freedoms,” he commented.

BBGA is encouraging DfT negotiators to prioritize securing bilateral agreements with 10 EU states in the hope that others may follow suit. According to data from analysts WingX, the most significant states for commercial business aircraft operations would include Germany, France, Spain, and Italy.

Over the past week, operators have complained that German officials have taken the hardest line in restricting market access and that French operators have raised what they viewed as unjustified objections to flights. BBGA is hoping that agreements can be reached with the top 10 states over the next two or three months while Covid lockdown rules mean that traffic levels are much lighter than normal. It has provided its members with an email address to report difficulties directly to the DfT negotiating team.

BBGA had hoped that 2021 would see negotiations to focus on going beyond the basic terms of the EU-UK agreement to include fifth freedom rights, but the group now acknowledges that it first has to secure the lesser traffic rights. Negotiators were not permitted to begin bilateral talks until the end of the transition period at midnight on December 31.

“Our goal is to encourage reciprocity in whatever shape the final agreement takes with each individual country,” Bailey said. “Each discussion may well result in a different outcome, and we have highlighted to members that a standard bilateral agreement may not be the final outcome in each case. It could be as simple as a memorandum of understanding, or it could become a full agreement with annual reviews.”

Bailey indicated to AIN that if EU member states do not offer acceptable bilateral terms the UK may feel compelled to withdraw its offer of a two-year transition period for traffic rights. BBGA is concerned that the lack of equitable market access rights could undermine fair competition.

Beyond traffic rights, the UK industry also faces potential difficulties over issues such as recognition of pilot and mechanic licenses, and also the importation of aircraft and components. These issues are expected to be subject to further negotiation on an EU-wide basis, but it is unclear when progress might be made.

Despite what would appear to be a significant downgrade in post-Brexit trading conditions for UK companies, BBGA says it remains optimistic about the industry’s long-term prospects. Bailey said the UK’s ability to forge new bilateral agreements with countries outside the EU will give its members an advantage.