Richard North, 24/07/2018  
 


Rising to the defence of the prime minister, the Irish Aviation Authority (IAA) has confirmed that flights between the UK and the rest of the European Union will be grounded by a hard Brexit - unless a separate deal to cover aviation is struck with London.

This is our old friend the Chicago Convention. As explained on Sunday, the freedoms of the air which are given effect by Regulation (EC) No 1008/2008 automatically lapse when the UK leaves the EU. And, with regard to that, a spokesman for the IAA has said: "There would need to be a new agreement in place to maintain the existing level of connectivity between Europe and the UK".  

Asked to clarify whether this would mean another agreement would be needed for UK flights to land in the Republic and other EU states, the spokesman said: "Regarding EU-UK flights, yes, another agreement or the reinstatement of old bilateral agreements would need to be in place if a hard Brexit occurs, to provide for connectivity between Europe and the UK".

This is not entirely correct as the old bilaterals were rescinded when replaced by the EU accord when many of the bilateral aviation agreements between Member States and third countries were declared discriminatory by the ECJ and had to be replaced.

Since that judgement, individual Member States no longer have power to sign such agreements. For the freedoms to be reinstated, there must be an EU-UK agreement.

However, the spokesman was correct in pointing out that "there is no World Trade Organisation (WTO) fallback position for aviation traffic rights in the event of a hard Brexit", a fact which has been conveyed to the Irish government and the European Commission.

This is affirmed by the European Commission, which has no hesitation in backing the Irish position, It says that EU rules in the field of air transport will no longer apply to the UK after Brexit, which would have "consequences in the different areas of air transport". Not least, of course, EU Member State carriers "will no longer enjoy traffic rights to or from the territory of the United Kingdom".

An IAA spokesman explained that this means that Irish airlines would not be permitted to land in the UK, saying: "in effect, as in the absence of no new agreement being reached between the EU and the UK that provides for air access, then there would be an interregnum in the period post March 29th, 2019".

In order to enjoy the freedoms covered by the regulation, airlines must hold EU operating licences. The European Commission says that in order to keep these, certain conditions must be met. "The conditions include, among others, the need to have one’s principal place of business within an EU member state", it says.

The airline must also be "majority owned and effectively controlled" by EU member states. "If the conditions are no longer fulfilled as a consequence of the United Kingdom becoming a third country, the operating licence at issue will no longer be valid".

Thus, "air carriers of the United Kingdom will no longer enjoy traffic rights under any air transport agreement to which the union is a party, be it to or from the territory of the United Kingdom, be it to or from the territory of any of the EU member states".

But that also means that UK airlines will not be enjoy the rights afforded by the EU-US "Open Skies" agreement, one of the horizontal agreements covering 41 countries and one regional organisation with eight member states.

For these reasons that low cost carrier EasyJet has established a headquarters in Austria but other British carriers who will be caught include Flybe, Jet2, Virgin Atlantic, and British Airways.

Nevertheless, there is every reason why the EU should want to deal, as the removal of UK airspace for overflights would severely inconvenience international airlines – and not just EU operators. Thus, we might expect to see fairly rapid arrangements to secure continuity of the Chicago Convention freedoms as is actually required of the convention signatories.

However, the 1944 Convention only covers five of the nine freedoms enjoyed by the UK, the ninth covering cabotage, the right of an airline to pick up passengers in a state other than its own and to transport them to another non-domestic state.

Then, even if the "freedoms" are resolved, this does not settle the safety issues. UK airlines will be obliged under EU law to apply to EASA for Third County Operator (TCO) approval. And then there is the question of the lapse of airport certification and the wide range of licenses which the EU will no longer recognise.

Without these being settled, aircraft operating out of EU Member States could regain overflight rights but would not be able to land at any UK airports. Nor, until the safety issues have been sorted out, will UK airlines be able to land at the airports of EU Member States, or at the airports of any country were recognition of safety certification relies on bilateral agreements with the EU.

These latter aspects, though, are not being openly aired by the media or politicians, who still seem to be hung up on the "freedoms". But, as the aviation regulatory "onion" is gradually unpeeled, it will become apparent just how complicated the issues are. And it is very far from clear how the situation will be managed in the event of a "no deal" Brexit.

All of this, of course, makes a nonsense of the idea that the UK can simply walk away from the Brexit negotiations and rely on WTO rules. For aircraft to continue to fly, the UK must negotiate a number of complex deal with the EU. It must also make arrangements with the 49 other countries covered by EU agreements.

This is being recognised by even the most rabid of the "ultras" such as Patrick Minford where we see the WTO option being characterised merely as having a "no trade deal".

This, we are told, is not the same as having no agreements on a wide range of non-trade areas where there have to be arrangements. These include visas, citizen rights, security, airline permissions and much else that is needed for citizens of the UK and the EU to carry on their ordinary lives. By this means, the likes of Iain Duncan-Smith feels justified in arguing that the WTO option is not a "no deal".

For all that, we've been there before. Last year, the same siren song was being heard, where effectively the "no deal" scenarios involved collecting together multiple smaller deals cobbled together. Yet this again is just the sort of cherry-picking approach that the EU has already rejected, and here we are back again with the idea of dipping into certain issues to craft a deal and leaving out other matters, on a schedule dictated entirely by the UK.

What is lacking is any sense of this being a negotiation where the other side might have a view, especially when Minford argues that these partial deals, without any trade deal with the EU, can be done "all at once and without paying them that £39 billion for a trade deal that has not materialised".

This alone renders the concept a non-starter. Even areas such as aviation, where the absence of a deal will inconvenience EU actors, one can see a strong element of conditionality that, at the moment, does not exist.

But this is without taking into account the more obvious defects of the WTO option where, despite the evidence that no major economy on the planet trades with EU on WTO terms, we see the persistence of the claim that the UK currently does upwards of 60 percent of its trade on WTO terms.

In support of that argument, there is much reliance on the canard that, because we start off after Brexit with regulatory alignment, there will be no need for border checks of manufactured goods. This neglects entirely the need for mutual recognition of conformity assessment, without which exporters will lack the means to demonstrate that their goods do in fact conform with the necessary standards.

The name of the game, though, is quite evidently an attempt to normalise the "no deal", projecting it as a tenable option instead of the disaster which it so obvious would become. I get intensely irritated by the likes of Owen Paterson lauding Minford, describing him as "unerringly correct on the major economic questions of the last 40 years", dispelling "the myths and ignorance surrounding a World Trade deal".

Thus do I write about the WTO option in my Monograph, written two years ago, is that it is a very dangerous and potentially expensive option which could do significant damage to the EU and UK, the effects of which could be long-lasting. Nothing has changed in those two years, except the increasingly frenetic attempts to argue black is white and that a Brexit disaster is something we should embrace.






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