U.S., EU to further open skies to each other

08:16, March 26, 2010      

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The United States and the European Union (EU) have struck a sweeping new pact to liberalize air travel across the North Atlantic, the largest market in the world, by eliminating restrictions on foreign ownership and control of airlines, the Chicago Tribune reported on Thursday.

The Open Skies II agreement, which must be approved by the U.S. Congress and European Parliament, would end U.S. rules limiting overseas investors to a 25-percent ownership stake in a U.S. airline.

Under the agreement, European carriers would be free to buy their American counterparts, and vice versa.

Similar efforts to loosen airline ownership restrictions, however, have drawn stiff opposition from members of Congress in the past and raised concerns ranging from national security to job security.

The new agreement includes a provision aimed at allaying fears of labor leaders on both sides of the Atlantic. It ensures that the "existing legal rights of airline employees are preserved, but that the implementation of the agreement contributes to high labor standards," according to an EU statement on the Open Skies deal.

Other provisions are aimed at streamlining security so international passengers see fewer hassles and greater consistency in screening as they travel between the two economic powers.

The treaty also seeks to boost "green" aviation by bringing the two sides in sync on market-based measures such as emission trading schemes, greater transparency to noise-based airport measures and use of green technologies, jet fuels and air traffic management.

The treaty, combined with an Open Skies agreement adopted in 2007, would create 80,000 new jobs and boost trans-Atlantic traffic by 26 million passengers over five years, according to a 2007 Booz Allen Hamilton study.

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