United States, Pacific Rim countries enter multilateral open skies agreement

by Canadian Shipper

U.S. Transportation Secretary Norman Y. Mineta and four Pacific Rim aviation partners from Brunei, Chile, New Zealand and Singapore have signed the first multilateral agreement based on “Open-Skies” principles.

“With this historic agreement we are beginning to move beyond the current system of bilateral aviation agreements and into the international aviation environment of the 21st century. It is especially significant that this new agreement involves the growing, strategically important Pacific Rim market. We invite other nations to join us in this effort to expand markets and break down barriers to trade,” said Mineta.

The United States currently has bilateral Open-Skies agreements with 52 aviation partners, including the four countries joining it in the new multilateral agreement.

Open- Skies agreements permit unrestricted service by the airlines of each side to, from and beyond the other’s territory, without restrictions on where carriers fly, the number of flights they operate, and the prices they charge.

The five countries initialed and announced that they had agreed in principle to the new multilateral “Open-Skies” agreement on Nov. 15, 2000 at the summit meeting of the Asia-Pacific Economic Cooperation group in Brunei.

The agreement purports to offer the following benefits: to help set the terms for the global marketplace and promotes the Open-Skies approach as a future international standard, to expand carrier access to equity financing, where many foreign carriers, which do not have access to large domestic capital markets, can obtain cross-border financing. The multilateral agreement substantially liberalizes the traditional ownership requirement, thus enhancing foreign carriers’ access to outside investment.
The agreements seeks also to streamline international aviation relations. Aviation is currently governed by thousands of bilateral agreements between more than 180 countries. By joining one multilateral agreement, countries can avoid prolonged negotiation of numerous individual bilateral agreements.

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