PART 5 VIEWS OF WITNESSES
93. Whilst the proposals would not
provide the Commission with a mandate to negotiate bilateral agreements
with third countries on behalf of the Member States, most witnesses
accepted that the proposals would have the effect of increasing,
at least de facto, the Commission's competence to act on
such issues. They regarded the proposals as being inextricably
linked to other proposals by the Commission to take over responsibility
for negotiating air services agreements on behalf of the Member
States (Q 221).
94. DG VII confirmed that the Commission
felt that "the time is right to develop an external Community
policy in the field of aviation and we are trying to achieve that
objective by a combination of legislative proposals and court
action". DG IV thought that the Member States feared that
once the Commission had "effective and efficient powers to
scrutinise forms of co-operation between airlines on the international
scene between the Community and third countries" it "would
interfere with their existing bilateral agreements". While
acknowledging that this was a real concern they argued that block
exemptions provided in the second of the proposed Regulations
[on revenue sharing and capacity co-ordination] would "take
most of the sting out of that argument". It was not DG IV's
intention "to scrutinise each and every of the many hundreds
of bilateral agreements which exist" (QQ 338-40).
95. Ms Jackson felt that "exclusive
competence to apply the Treaty's competition rules to air services
to and from third countries should be linked to the competence
to negotiate the relevant air services agreements" (Q 359).
Lufthansa echoed this view but stated that they were in favour
of the Commission being granted authority to negotiate bilaterals
with third countries "provided that the agreements are properly
structured and serve the interests of the Community"(Q 152).
The CAA referred to the possibility of there remaining in place
transitional restrictions on the number of permitted airlines,
frequencies and capacities. In this event it would be necessary
to put in place a means for making choices between which carriers
from the different Member States should be allowed to operate
(p 5). Ms Jackson pointed out however, that there was disagreement
between the Member States about the type or model of such a mandate
96. Delta Airlines thought that if
the Commission was given a mandate by the Council to negotiate
bilateral agreements with third countries it could "see a
danger that negotiations could become very long and drawn out
and inflexible unless the European Union authorities or the Commission
negotiators had very clear mandates and very clear guidelines"
97. In the context of the liberalisation
of air services the Commission has been mandated by the Council
of Ministers to undertake aviation negotiations with Switzerland
and ten central and eastern European countries, which could in
due course lead to an extension of the common market in aviation.
It also has a mandate to hold limited exploratory talks on "soft"
rights with the United States but has no authority to negotiate
"full" traffic rights on issues concerning market access,
capacity or fares
98. Lufthansa favoured a step-by-step
approach, arguing that carriers would need time to adapt to changes
in their regulatory framework. It was the airline's view that
the Commission should be required to "demonstrate the added
value of Community negotiations". The experience gained from
any negotiations should be evaluated before including more third
countries. For the Council of Ministers to agree a mandate to
open negotiations on full traffic rights with the United States
would appear to be a first priority (QQ 152-3).
99. British Midland favoured giving
the Commission more responsibility within "geographical Europe
and North Africa" as a first stage. Only when the Commission's
abilities in this area had been tested would it be appropriate
to approach the wider issue of handling relations with other third
countries (Q 41).
100. The CAA thought that a phased
approach was not only desirable but inevitable if the Commission
was to have any prospect of achieving its long term objectives.
It was unlikely that the Commission would wish to extend its sphere
of influence beyond a relatively small number of the most important
aviation countries, in particular the United States. A fully liberalised
internal European market would provide the best basis for any
EU-wide bilateral agreement with a third country (pp 4-5). It
was the DETR's view that a series of inter-regional agreements
would be more likely than a series of agreements with individual
third countries (p 92).
29 The distinction between soft and hard (or full)
rights is not well defined. The issues discussed in these limited
exploratory talks between the Commission and the United States
Department of Justice include: ownership and control restrictions,
competition rules, computer reservation systems, code sharing,
dispute settlement, aircraft leasing, environmental clauses, transition
measures, slot rules, and safety and security issues. Back