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International aviation: Canada

The EU-Canada Air Transport Agreement, signed on 17/18 December 2009, is so far the most ambitious air transport agreement between the EU and a major partner in the world. It had been finalised in November 2008 and was endorsed by the EU-Canada Summit in May 2009.

 

The Agreement was negotiated by the Commission under a mandate received from the Council in October 2007, and has replaced bilateral air services agreements concluded between EU Member States and Canada. The Agreement will significantly improve both the connections between respective markets and people-to-people links, and will create new investement opportunities through a gradual liberalisation of foreign ownership rules with respect to airlines. It includes a gradual phasing-in of traffic rights, mutual investment opportunities, as well as far reaching cooperation on a number of issues including safety, security, social matters, consumer protection, environment, air traffic management, competition law and state aid.

The Agreement is groundbreaking in the aviation world as it provides for unprecedented levels of liberalisation in terms of traffic rights as well as of foreign investment in airlines.

Under the Agreement EU airlines and Canadian airlines are allowed to operate direct flights between any point in Canada and any point within the EU. The Agreement also removes all restrictions on the number of weekly flights between Canada and the EU, and the capacity and prices offered by airlines. Further traffic rights will be liberalised gradually in parallel with the opening up of investment opportunities in airlines. The Agreement will finally establish a fully Open Aviation Area between the EU and Canada. EU nationals will be allowed to establish operations in Canada and freely invest in Canadian airlines and vice versa.

Furthermore, the Agreement will address common challenges such as safety, security or the environment. Both sides agreed to closely cooperate in order to mitigate the effects of aviation on climate change. In the field of safety and security, the agreement envisages the mutual recognition of each other's standards and one-stop security. Specific provisions to improve consumer protection are also included. This will facilitate the operations of airlines and airports, and will reduce hassle for passengers. The text provides for a strong mechanism to ensure that fair competition between operators is always maintained, which is another novelty in international aviation.