"EU rejects U.S. air pact"

Saturday, June 12, 2004

EU rejects U.S. air pact
Bloomberg News


The European Union on Friday rejected as inadequate a U.S. offer to open
part of the American airline market to carriers like Air France,
preventing an accord that would also spur trans-Atlantic route
competition and mergers. The talks will continue.

The 25-nation EU said the offer to let European airlines buy capacity on
U.S. routes was not generous enough to justify a broader "open-skies"
agreement.

Such a pact would also end route restrictions in the $18 billion
trans-Atlantic market and eliminate exclusive rights that carriers
including British Airways and United Airlines have at Heathrow Airport
outside London.

Britain, which accounts for 40 percent of the trans-Atlantic airline
market, led opposition to an accord.

"We aren't going to make a deal without the U.K.," an EU spokesman,
Amador Sanchez Rico, said at a meeting of transport ministers in
Luxembourg.

The restrictions that an agreement would abolish prevent European
airlines from flying to the United States from airports in the EU
outside their home country and U.S. carriers other than United and
American from flying to Heathrow, Europe's busiest airport.


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