Abstract
Broadly speaking, the phrase “sustainable development” means development that caters to the needs of the present generation without compromising the ability of the future generation to achieve their needs. Usually, this phrase is used in an environmental sense. However, it could also mean – as in the context of this chapter-development that ensures the sustainability of an industry. The initial and fundamental premise of the air transport industry is that the air transport sector has never been continuously profitable and that the industry’s profitability has been cyclical. Competition in air transport has been a key factor along with the perceived anomalies that are not seen in other transport modes, such as sovereignty which is a key issue in the award of air traffic rights and the requirement that ownership and control of an airline should be in the hands of nationals of a country I which an airline is registered on a majority basis. All of these factors lead to air transport being subject to the Game Theory, which is a branch of applied mathematics that is used in conformity with economic principles. The Game Theory suggests that strategic interactions among economic agents (air carriers) result in outcomes with respect to their preferences. The success of their choices depends on choices made by others. Apart from air transport economics, the Game theory applies to other areas such as security and environmental protection.
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Notes
- 1.
- 2.
Flying Smart, Thinking Big, Airbus Industrie’s Global Market Forecast, 2009–2028, at 16.
- 3.
Ibid.
- 4.
Airbus Forecast, supra, at 8–9.
- 5.
The gross domestic product (GDP) or gross domestic income (GDI) is a basic measure of a country’s overall economic output.
- 6.
The Convention on International Civil Aviation, signed at Chicago on 7 December 1944, (supra, note 1) which is the founding document of commercial aviation, in its Preamble, recognizes that the future development international civil aviation can greatly help to create and preserve friendship and international understanding among the nations and peoples of the world, yet its abuse can become a threat to the general security; and it is desirable to avoid friction and to promote that cooperation between nations and peoples upon which the entire peace of the world depends. See ICAO Doc 7300/9 Ninth Edition: 2006, Preamble. The most significant modernist construction of the role of civil aviation in securing world peace and security comes from language used in the letters of invitation issued by the United States to the participant States to the Chicago Conference, that, consequent to the war, the restorative processes of prompt communication may greatly facilitate the return to the processes of peace. However, the conscious awareness of the parties to the Convention, that in securing this peace, prudent economic and business principles must not be compromised, should not be forgotten. See Proceedings of the International Civil Aviation Conference, Chicago, Illinois, November 1–7 December 1944, US Department of State Volume 1 at 7.
- 7.
Id.
- 8.
The Chicago Conference was convened by President Roosevelt of the United States from 1 November to 7 December 1944 and led to the adoption by 52 States (attending the Conference) of the Convention on International Civil Aviation (hereafter, the Chicago Convention). See Proceedings of the International Civil Aviation Conference, Chicago, Illinois, November 1–7 December 1944, US Department of State: Volumes I and II.
- 9.
Supra, note 3.
- 10.
Supra, note 1. In December 2004, following a decision by the 35th Session of the ICAO Assembly, the Council of ICAO approved six Strategic Objectives for 2005–2010: They are: safety; security; environmental protection; efficiency; continuity; and rule of law. At the 37th Assembly of ICAO (2010) these strategic objectives were revised and only four remain: safety; security; environmental protection and sustainability of air transport.
- 11.
Chicago Convention, supra, note 3, Article 44.
- 12.
Over the past 50 years particularly in the past two decades, commercial air carriers gradually broke the shackles of rigid regulation to form strategic alliances among themselves. These alliances have been formed in the realization that the performance of an airline can be affected by two factors: the average performance of all competitors in the airline industry; and whether the airline concerned is a superior or inferior performer in the industry. Michael Porter encapsulates these two factors in the single premise that any business achieves superior profitability in its industry by attaining either higher prices or lower costs than rivals. Curiously, in the airline industry, it is the latter – lower costs – which has been the cornerstone of strategic alliances.
- 13.
The principle of State sovereignty in airspace is embodied in Article 1 of the Chicago Convention which recognizes that every State has sovereignty over the air space above its territory, the latter being defined in Article 2 as land situated within and water adjacent to the State concerned.
- 14.
Report of the International Law Commission to the General Assembly on the Work of the 1st Session, A/CN.4/13, June 9 1949, at 21.
- 15.
Supiot (2010).
- 16.
See International Transport Workers’ Federation and Finnish Seamens’ Union v. Viking Line ABP and OU Viking Line Easti, ECR 2007, 1–10779 (Case C-438/05, 6 December 2007). Also, Centros Ltd. v. Erhvervs-og Selskabsstyrelsen, ECR, 1-1459case no. C-212/97, 9 March 1999. For an air transport analogy see Abeyratne (2004).
- 17.
Doganis (2001) at 11.
- 18.
GATS seeks to liberalize trade regarding the provision of services. It deals with, and provides for two types of obligations – general and specific. The former relates to obligations of States and the latter to commitments made by States. Also, The GATS Agreement identifies and makes provision for specific services through its various annexes. The Air Transport Annex of GATS currently includes aircraft repair and maintenance; the selling and marketing of air services; and computer reservations systems. Notwithstanding the profile of the Annex, a certain ambivalence pervades the interpretation of inclusionary elements in the Annex and their application. This is evident in the fact that only a few WTO members have committed to the three activities.
- 19.
The World Trade Organization (WTO-OMC) came into being on 1 January 1995 and along with it entered into force the General Agreement on Trade in Services (GATS). The GATS Annex on Air Transport Services applies trade rules and principles such as most-favoured nation (MFN) treatment and national treatment to three specific so-called “soft” rights, namely, aircraft repair and maintenance, selling and marketing of air transport, and computer reservation system services. It excludes from the application of the GATS “services directly related to the exercise of traffic rights”. Pursuant to an earlier ministerial decision, the WTO-OMC launched in 2000 the first review of the operation of this Annex with a view to considering possible extension of its coverage in this sector. During the review, which continued into 2002, there was some support to extend the Annex to include some additional “soft” rights (for example, ground handling) as well as some aspects of “hard rights” (for example, air cargo, non-scheduled and multi-modal transport). However, there is no global consensus at this stage on whether or how this would be achieved.
- 20.
Supra, note 3.
- 21.
Stadlmeier (1997).
- 22.
Supra, note 1.
- 23.
See Janda (1995), where the author claims that the failure of ICAO to seize the initiative over multilateral liberalization of air transport services has left the field open to WTO.
- 24.
Chicago Convention, supra, note 3 Article 44 a).
- 25.
Id. Article 44 d).
- 26.
General Agreement on Trade in Services, Uruguay Round Agreement, Article II 1.
- 27.
Field (2005).
- 28.
Chicago Convention, supra, note 3, Article 44 d).
- 29.
See generally, Market Access: Unfinished Business, Post Uruguay Round Inventory and Issues, World Trade Organization, Special Studies 6:2001 at pp. 99–105.
- 30.
Article III of GATS requires each party to publish promptly all relevant laws, regulations, administrative guidelines and all other decisions, rulings or measures of general application, by the time of their entry into force.
- 31.
GATT’s national treatment philosophy provides foreign services and services suppliers with treatment no less favourable than that accorded to a country’s own services and service suppliers.
- 32.
Since GATS is an Annex to the GATT agreement it should be noted that the provisions of GATS are governed by those of GATT and that both documents incorporate the same basic principles.
- 33.
Article II of GATS. Article XVI extends the MFN principle to market access.
- 34.
Article XXIII on dispute settlement is considered to be well balanced and equitable and provides that if any Party should consider that another Party fails to carry out its obligations or commitments under the agreement, it may make written representations or proposals to the other Party or Parties concerned and the latter should give sympathetic consideration to the representations or proposals so made. If no satisfactory settlement could be arrived at, the GATT agreement provides for a formal dispute settlement procedure in Articles XXII and XXIII.
- 35.
Article 2 of the Chicago Convention provides that the territory, referred to in Article 1 is deemed to be the land areas and territorial waters adjacent thereto under the sovereignty, suzerainty, mandate and protection of that State.
- 36.
Vienna Convention on the Law of Treaties, United Nations General Assembly DocumentA/CONF.39/27, 23 May 1969.
- 37.
Vienna Convention, Id, Preamble.
- 38.
Id. Article 42. 1.
- 39.
Id. Article 57.
- 40.
Id. Article 59.
- 41.
Id. Article 60.
- 42.
Id. Article 61.
- 43.
Id. Article 62.
- 44.
Id. Article 46.
- 45.
Reuter (1989).
- 46.
At the time of writing ICAO had 190 member States.
- 47.
For a more detailed explanation of this argument see Wassenbergh (2001).
- 48.
New Aircraft Orders – A Positive Sign but with Some Risks, IATA Economics Briefing, IATA: Geneva, February 2006.
- 49.
The estimates of IATA show net profits for the airlines of $ 6.5 billion in 2007 after incurring $ 46.4 billion losses over the previous 6 years.
- 50.
The European Union or the EU is an inter-governmental and supranational union of 27 European countries, known as member States. The European Union was established under that name in 1992 by the Treaty on European Union (the Maastricht Treaty). However, many aspects of the Union existed before that date through a series of predecessor relationships, dating back to 1951. The European Union’s activities cover all areas of public policy, from health and economic policy to foreign affairs and defense. However, the extent of its powers differs greatly between areas. Depending on the area in question, the EU may therefore resemble: a federation (for example, on monetary affairs, agricultural, trade and environmental policy, economic and social policy); a confederation (for example, on home affairs) an international organization (for example, in foreign affairs) A key activity of the EU is the establishment and administration of a common single market, consisting of a customs union, a single currency (adopted by 12 of the 25 member states), a common agricultural policy, a common trade policy, and a common fisheries policy.
- 51.
An open skies agreement is defined as a type of agreement which, while not uniformly defined by its various advocates, would create a regulatory regime that relies chiefly on sustained market competition for the achievement of its air services goals and is largely or entirely devoid of a priori governmental management of access rights, capacity and pricing, while having safeguards appropriate to maintaining the minimum regulation necessary to achieve the goals of the agreement. Open skies agreements are believed to provide for more competition, lower prices and higher passenger volumes in markets between signatory nations. See ICAO Doc 9626, supra. note 323, at 2.2-2.
- 52.
A cabotage right or cabotage privilege is a right or privilege granted to a foreign State or foreign carrier to carry revenue traffic from one airport of a State to another in the same contiguous territory of that State. See Manual on the Regulation of International Air Transport, ICAO Doc 9626, supra, note 2. at 4.1–10.
- 53.
Jeffrey N. Shane, Aviation Deregulation: A Work in Progress, speech delivered to the International Aviation Club, Washington DC, November 8, 2005, published in Moving the American Economy, US DoT: 2005 at p.7.
- 54.
The effects of open skies agreements signed by the US with Latin American countries has been beneficial to US carriers. A report released on this subject in 2000 revealed that an open skies arrangement with these countries is particularly advantageous for US carriers. The study showed that from 1997 to 1998 the capacity of US carriers in countries with open skies increased by 24.2%, while local carriers boosted their capacity by only 12.3%. Also, in the same period Origin-Destination (OD) traffic between the US and open skies countries in the region grew by 22.2% while the same traffic rose only 3.5% in countries without open skies. The study mentions that market shares of US carriers in Latin American OD markets began to rise dramatically in the 1990s regardless of whether open skies existed. The study also points out that between 1990 and 1998 the US flag market share between the US and South America jumped from 43.1% to 57.4%, while it climbed eight points to 60.4% in Central America and Mexico. Results of the study also indicates that in 1998, South American airlines lost “more than 1.2 million passengers to their US competitors,” while Central American and Mexican carriers lost 1.3 million. See The impact of open skies between the United States and Latin America, at 78. (Available from Avman 6355, NW 36th St. Suite 601 Miami, Fl 33166).
- 55.
At a lecture delivered to the Royal Aeronautical Society, Montreal Branch, on 8 December 2005, on the subject Air Transport Liberalization: Ideal or Ordeal, Mr Shane asserted that liberalization begets more liberalization and that liberalization is the classic good deal that will not go unpunished. See www.dot.gov/affairs/briefing.htm at p. 11.
- 56.
Jeffrey Shane, supra, note 53 at p. 2.
- 57.
EU, US Make Substantial Progress on Open Skies, Aviation Daily, Monday, October 24, 2005 at p.2.
- 58.
Ibid.
- 59.
EU seeks US Aviation Agreement in 2006, Air Letter, Thursday, 22 November 2005, No. 15,873, at p.2.
- 60.
Text of a Joint Statement by the US and EU, http://www.a2a.aero/news/story.html?story/.
- 61.
Air transport in the European Community is fundamentally regulated by two treaties, i.e. the Treaty which establishes the European Coal and Steel Community (ECSC Treaty) and the Treaty which establishes the European Economic Community (EEC Treaty, now called the EC Treaty). The former, which was signed in Paris in 1951, addresses issues related to the carriage of coal and steel through the media of rail, road and inland waterways and as such is not directly relevant to aviation. The latter, on the other hand, admits of issues relating to all modes of transport in the carriage of persons and goods and is of some relevance to aviation.
The EEC Treaty, which was signed in Rome on 25 March 1957, has at its core a Common Transport Policy (CTP) concept which is calculated to achieve the fundamental purposes of the European Community. One of the most salient features of the EEC Treaty is that the tasks of the Community are set out succinctly in Article 2 of the Treaty which provides inter alia for the adoption of a CTP as provided for in Article 3(1) of the Treaty. This provision is linked to Article 74 which in turn provides that the objectives of the Treaty in relation to issues of transportation would be pursued by State Parties within the parameters of the CTP, which is established by the Council of Europe through secondary legislation.
- 62.
Henri Wassenbergh, Open Skies and a Global Common Air Traffic Market, Journal LuchtRecht, Special Edition, Liber Amicorum in Honour of Prof. Dr. I.H.Ph. Diederiks-Verschoor, Nr. 9/10, December 2005, 51 at p.53.
- 63.
Two of the most important EU institutions are the Council of the European Union and the European Commission (the other two being the European Parliament and the European Court of Justice. The Council of the European Union contains ministers of the governments of each of the European Union Member States.. It is sometimes referred to in official European Union documents simply as the Council or the Council of Ministers (which will become its official name if the Treat establishing a Constitution of Europe is adopted). The Council has a President and a Secretary-General. The President of the Council is a Minister of the state currently holding the Presidency of the Council of The European Union, while the Secretary-General is the head of the Council Secretariat, chosen by the member states by unanimity providing general advice, qualified legal advice, translation services and impartial negotiation assistance. The Council of the European Union should be distinguished from the European Council, which meets four times a year in what is informally known as the European Summit EU Summit), and is a closely related but separate body, made up with the heads of state and government of the member states, whose mission is to provide guidance and high level policy to the Council. It is also to be distinguished from the Council of Europe which is a completely separate international organization and not a European institution.
The European Commission (formally the Commission of the European Communities) is the executive body of the European Union. Alongside the European Parliament and the Council of the European Union, it is one of the three main institutions governing the Union.
- 64.
The seventh freedom of the air is the right or privilege in respect of scheduled international air services, granted by one State to another State, of transporting traffic between the territory of the granting State and any third State with no requirement to include on such operation any point in the territory of the recipient State. i.e. the service need not connect to or be an extension of service to/from the home State of the carrier.
- 65.
The eighth freedom of the air is the right or privilege, in respect of scheduled international air services, of transporting cabotage traffic between two points in the territory of the granting State on a service which originates or terminates in the home territory of the foreign carrier or (in connection with the seventh freedom of the air) outside the territory of the granting State).
- 66.
The ninth freedom of the air is the right or privilege of transporting cabotage traffic of the granting State on a service performed entirely within the territory of the granting State.
- 67.
Wassenbergh, supra, note 62 and 945, at p. 55.
- 68.
The European Court of Justice (ECJ) is formally known as the Court of Justice of the European Communities’, i.e. the court of the European Union (EU). It is based in Luxembourg, unlike most of the rest of the European Union institutions, which are based in Brussels and Strasbourg. The ECJ is the Supreme Court of the European Union. It adjudicates on matters of interpretation of European law, most commonly: claims by the European Commission that a member state has not implemented a European Union Directive or other legal requirement; claims by member states that the European Commission has exceeded its authority; and references from national courts in the EU member states asking the ECJ questions about the meaning or validity of a particular piece of EC Law. The Union has many languages and competing political interests, and so local courts often have difficulty deciding what a particular piece of legislation means in any given context. The ECJ steps in, giving its ruling which is binding on the national court, to which, the case will be returned to be disposed of. The ECJ is only permitted to aid in interpretation of the law, and not decide the facts of the case itself. Individuals cannot bring cases to the ECJ directly. An individual who is sufficiently concerned by an act of one of the institutions of the European Union can challenge that act in a lower court, called the court of First Instance. An appeal on points of law lies against the decisions of the Court of First Instance to the ECJ.
- 69.
See generally Abeyratne (2003).
- 70.
See Communication From the Commission, Developing the Agenda for the Community’s External Aviation Policy, Commission of the European Communities, Brussels, 11.03.2005, COM (2005) 79 Final.
- 71.
US;EU agree on Text of Deal, Await Final Ownership Rule, Aviation daily, Monday, November 21, 2005, at p.2.
- 72.
Baker (2005).
- 73.
Ibid.
- 74.
Deregulation and Airline Competition, Organization for Economic Cooperation and Development, OECD: Paris, 1988 at pp. 20–21.
- 75.
The EC Treaty, also called the Treaty of Rome, was concluded in 1957 to forge “an even closer union among the people of Europe”. See Goh (1997). See supra, note 16.
- 76.
Case 167/73 Commission v. French Republic [1974] ECR359 at 370.
- 77.
Adkins (1994).
- 78.
Case T-51/89, Tetra Pak Rausing SA. v. Commission [1990] II E.C.R. 309, [1991] 4C.M.L.R. 334 para 31.
- 79.
Case 85/76 Hoffman-La Roche & Co. A.G. v. Commission [1979] E.C.R. 461.
- 80.
Brooke Group Ltd. v. Brown and Williamson Tobacco Corp., 509 U.S. 209 (1993).
- 81.
Matsushita Electric Industrial Co. Ltd., et al. v. Zenith Radio Corp. et al., 475 U.S. 574 (1986).
- 82.
Brooke, supra, note 80at 224.
- 83.
The Areeda-Turner test defines criteria that determine predatory pricing. According to this test, a short run profit maximizing price as well as a price above full costs are non predatory. The test also goes to consider that a price at or above reasonably anticipated short run marginal costs is non-predatory. Also, a price at or above reasonably anticipated average variable cost should be considered to be within legal limits. see Roos and Sneek (1997).
- 84.
Policy and Guidance Material on the Economic Regulation of International Air Transport, Doc 9587, Second Edition, 1999, Appendix 2 at A2-2. See also Manual on the Regulation of International Air Transport, Doc 9626 First Edition 1996, Appendix 5, Guidance Material for Users of Air Transport, at A5-1.
- 85.
A study conducted in 1986 by the Brookings Institution concluded that consumers in the US saved $ 6 billion annually in fares and the airline industry experienced an average annual profit of $ 2.5 billion since domestic de-regulation in 1978. See Morrison and Winston (1986).
- 86.
The Economic and Social Benefits of Air Transport, Air Transport Action Group: 2005, at 7.
- 87.
One of the commonest uses of code sharing is to signify that two airlines conclude an arrangement according to which two or more connecting flights are offered under a common designator code and flight number or those of both airlines, although individual segments are operated with aircraft of one airline. See Abeyratne (1995).
- 88.
It will be recalled that, when the US and the Netherlands entered into what was the first open skies agreement between the US and a European country, KLM, who already had access to all US points, consented to the agreement on the condition that both parties accept the KLM/Northwest alliance with anti trust immunity and mutual code sharing. By code sharing, KLM could provide “own” on line services to US points without operating services itself. See Wassenbergh (2000).
- 89.
. See DoT Order No. 92-8-13, 35 of 1992. Also, I.L.M. 1479 (1996).
- 90.
Neil Kinnock, Speech to the Association of European Airlines, Luxembourg, April 28, 1995.
- 91.
The DoT and Department of Justice of the US review anti trust cases on a case by case basis. See DoT order to show cause, 96-5-26, OST-95-618.
- 92.
IATA Economics, Presentation made to ICAO on 24 January 2006.
- 93.
Supra.
- 94.
There are other instances, such as Alitalia, where the Italian government saved the carrier by covering its debt into equity and the subsidies given by the Scandinavian countries to SAS.
- 95.
See Abeyratne (2005).
- 96.
Doganis cites the example where, under the “fly America Policy, officials or others travelling on behalf of the US Government were and are required to fly on US airlines or US carrier code shared flights irrespective of open skies agreements applying to the sectors flown” Doganis (2001 at p.45).
- 97.
.Aeropolitical News, IATA,REf.744-18.11.99.
- 98.
Tanzania (1999), Namibia (2000), Burkina Faso (2000), Ghana (2000), The Gambia (2000), Nigeria (2000), Morocco (2000), Rwanda (2000), Benin (2000), Senegal (2000), Uganda (2002), Cape Verde (2002), Madagascar (2004), Gabon (2004), Ethiopia (2005) and Mali (2005).
- 99.
Flanagan (1996).
- 100.
An airport slot is a designated day and time usually within a 15 or 30 min period for an aircraft to arrive at or depart from an airport. See Regulatory Implications of the Allocation of Flight Departure and Arrival Slots at International Airports, ICAO Doc 283-AT/119, 2001 at Chapter 1, p.1. European Council Regulation (EEC) No 95/93 of 18 January 1993 on common rules for the allocation of slots at Community airports defines a slot as “the scheduled time of arrival or departure available or allocated to an aircraft movement on a specific date at an airport co-ordinated under the terms of the Regulation”.
- 101.
Supra, note 3.
- 102.
In this case, it was reported that Britain’s number two long-haul airline, Virgin Atlantic Airways, and Australia’s flag carrier Qantas each paid an alleged 20 million GBP to the small British regional airline Flybe. for six slots at Europe’s biggest airport, London Heathrow. Heathrow is known as one of most – if not the most – slot constrained airports in the world, with airlines queuing for years to gain access to the airport. See The Sunday Times, Heathrow Slots Take Off, January #, 2004; O’Connell, The Sunday Times, Soaring Costs Of Touching Down, February 22, 2004.
- 103.
Circular 283, Supra.
- 104.
Levine (2009).
- 105.
Kimpel (1997).
- 106.
- 107.
Air transport in the European Community is fundamentally regulated by two treaties, i.e. the Treaty which establishes the European Coal and Steel Community (ECSC Treaty) and the Treaty which establishes the European Economic Community (EEC Treaty, now called the EC Treaty). The former, which was signed in Paris in 1951, addresses issues related to the carriage of coal and steel through the media of rail, road and inland waterways and as such is not directly relevant to aviation. The latter, on the other hand, admits of issues relating to all modes of transport in the carriage of persons and goods and is of some relevance to aviation.
- 108.
The EEC Treaty, which was signed in Rome on 25 March 1957, has at its core a Common Transport Policy (CTP) concept which is calculated to achieve the fundamental purposes of the European Community. One of the most salient features of the EEC Treaty is that the tasks of the Community are set out succinctly in Article 2 of the Treaty which provides inter alia for the adoption of a CTP as provided for in Article 3(1) of the Treaty. This provision is linked to Article 74 which in turn provides that the objectives of the Treaty in relation to issues of transportation would be pursued by State Parties within the parameters of the CTP, which is established by the Council of Europe through secondary legislation.
- 109.
Henri Wassenbergh, Open Skies and a Global Common Air Traffic Market, Journal LuchtRecht, Special Edition, Liber Amicorum in Honour of Prof. Dr. I.H.Ph. Diederiks-Verschoor, Nr. 9/10, December 2005, 51 at p.53.
- 110.
At the ICAO Conference on the Economics of Airports and Air Navigation Services (CEANS) held from 15 to 20 September 2008 in Montreal, 53 African States argued that countries have an obligation to provide slots to meet the capacity needs of air carriers operating under air service agreements. Their argument was that denying slots to airlines operating under air services agreements is tantamount to non utilization of the agreements which may be interpreted as a technical way of making the implementation of the Agreement to be unfair and one sided, contrary to the principle of reciprocity. See CEANS –WP/61.
- 111.
See ICAO Assembly Resolution A 36-22 (Consolidated statement of continuing ICAO policies and practices related to environmental protection) adopted at the 36th Session of the ICAO Assembly, Doc 9902 Assembly Resolutions in Force as at 28 September 2007, at 1–54.
- 112.
Article 84(2) stipulates that the Council may, acting by a qualified majority, decide whether, to what extent and by what procedure appropriate provisions may be laid down for sea and air transport.
- 113.
Treaty Establishing the European Community as Amended by Subsequent Treaties, Rome, 25 March 1957, Supra note 990.
- 114.
Article 5 of the Regulation prescribes that at a coordinated airport, the Member State responsible shall ensure that a coordination committee is set up. The same coordination committee may be designated for more than one airport. Membership of this committee shall be open at least to the air carriers using the airport(s) in question regularly and their representative organisations, the managing body of the airport concerned, the relevant air traffic control authorities and the representatives of general aviation using the airport regularly.
- 115.
Matthias Kilian, The development of the regulatory regime of slot allocation in the EU, at http://mitglied.multimania.de/matthias_kilian/vortragberlin.pdf.
- 116.
Ibid.
- 117.
- 118.
Secondary trading is the horizontal transfer of slots between persons allocated, or entitled to hold slots, by agreement between them (the parties), accompanied, if the parties wish, by payment of monetary (or other valuable consideration) from one to the other in respect of such transfer. See Study on the Impact of the Introduction of Secondary Trading at Community Airports, Volume 1 Report, November 2006, Mott MacDonald, at 4-1.
- 119.
Grandfather slots refers to the situation where an airline’s historical dominance at an airport has become institutionalized at an airport. This practice has been criticized on the ground that airlines do not own slots and it is the airport operator who grants times of arrival and departure of aircraft.
- 120.
Airport Slot Allocation: The Commission Clarifies Existing Rules, IP/08/672, Brussels, 30 April 2008.
- 121.
The European Court of Justice (ECJ) is formally known as the Court of Justice of the European Communities’, i.e. the court of the European Union (EU). It is based in Luxembourg, unlike most of the rest of the European Union institutions, which are based in Brussels and Strasbourg. The ECJ is the Supreme Court of the European Union. It adjudicates on matters of interpretation of European law, most commonly: claims by the European Commission that a member state has not implemented a European Union Directive or other legal requirement; claims by member states that the European Commission has exceeded its authority; and references from national courts in the EU member states asking the ECJ questions about the meaning or validity of a particular piece of EC law. The Union has many languages and competing political interests, and so local courts often have difficulty deciding what a particular piece of legislation means in any given context. The ECJ steps in, giving its ruling which is binding on the national court, to which, the case will be returned to be disposed of. The ECJ is only permitted to aid in interpretation of the law, and not decide the facts of the case itself. Individuals cannot bring cases to the ECJ directly. An individual who is sufficiently concerned by an act of one of the institutions of the European Union can challenge that act in a lower court, called the Court of First Instance. An appeal on points of law lies against the decisions of the Court of First Instance to the ECJ.
- 122.
As mentioned earlier, the EC Treaty, also called the Treaty of Rome, was concluded in 1957 to forge “an even closer union among the people of Europe”. See Goh (1997).
- 123.
Case 167/73 Commission v. French Republic [1974] ECR359 at 370.
- 124.
See Adkins (1994).
- 125.
Case T-51/89, Tetra Pak Rausing SA. v. Commission [1990] II E.C.R. 309, [1991] 4C.M.L.R. 334 para 31.
- 126.
Case 85/76 Hoffman-La Roche & Co. A.G. v. Commission [1979] E.C.R. 461.
- 127.
Icy conditions also curtailed Europe’s train services, left cars skidding through slushy streets and saw major events postponed, including music shows and sporting events. See http://www.ibtimes.com/articles/93795/20101220/travelers-air-passengers-stranded-as-europe-freezes-due-to-heavy-snowfall.htm.
- 128.
- 129.
- 130.
- 131.
- 132.
Airports Council International is the only global trade representative of the world’s airports. Established in 1991, ACI represents airports interests with Governments and international organizations such as ICAO, develops standards, policies and recommended practices for airports, and provides information and training opportunities to raise standards around the world.
- 133.
European Airports and Kallas discuss Industry Challenges, Transport Policy, at http://www.transportpolicy.org/europe%E2%80%99s-airports-and-kallas-discuss-industry-challenges/.
- 134.
Ibid.
- 135.
UK policies “will destroy the proud legacy” of British Aviation, Travel daily News, 28 February 2011. See http://www.traveldailynews.com/pages/show_page/41578-UK-policies-%E2%80%9Cwill-destroy-the-proud-legacy%E2%80%9D-of-British-aviation.
- 136.
- 137.
BAA’s non-executive Director, Sir David Begg is reported to have launched an inquiry just prior to Christmas to inquire into what went wrong. See infra, note 14.
- 138.
Virgin Atlantic Withholds BAA Fees Over Snow Row, Air Letter, Monday 10 January 2011, No. 17,147 at 2.
- 139.
- 140.
The functions and responsibilities of an airport will vary according to its size, type of traffic and areas of responsibility. For example, some airports are responsible for air traffic control as well as for meteorological services, while at most other airports such services are provided by separate government entities. Many airports are involved in security functions in varying degrees and in providing facilities for customs, immigration and health authorities. Ground-handling services for the airlines, including terminal handling or ramp handling, or both, are provided by some airports, while at others they are provided by the airlines or by specialized agents or companies. Certain airports also perform functions that exceed the scope of conventional airport activities, such as consultancy services, public works, construction, and real estate development. See Abeyratne (2009).
- 141.
Puempol (2006).
- 142.
Ibid.
- 143.
See Chaps. 6 and 7 of Annex 14 (Aerodromes) Volume 1 (Aerodrome Design and Operations), Annex 14 to the Convention on international Civil Aviation, Fourth Edition, July 2004, at 6-1 to 8-3. Also Chap. 5 of Annex 14 Volume II (Heliports), Second Edition – July-1995 at p. 30–48 which has similar provisions for the operation of helicopters.
- 144.
Id. Annex 14, Chap. 10.
- 145.
Miyagi (2005).
- 146.
Standard 2.1.2.
- 147.
Requirements concerning qualifications and training of meteorological personnel in aeronautical meteorology are given in WMO Publication No. 49, Technical Regulations, Volume I – General Meteorological Standards and Recommended Practices, Chapter B.4 – Education and Training.
- 148.
Standard 2.2.1.
- 149.
Standard 3.3.1.
- 150.
It is noteworthy that, in response to a request received from IATA, the Secretariat of ICAO has included “tsunami” in the draft amendment to Annex 3 to the Convention on International Civil Aviation which addresses meteorological services, as a phenomenon which should prompt the issuance of an aerodrome warning. It may be expected that within the global warning system for tsunami being established under the Intergovernmental Oceanographic Commission of UNESCO (IOC), the meteorological authorities will receive tsunami warnings in a timely manner and that they will be in a position to implement the proposed amendment, as far as aerodrome warnings are concerned, in time for its applicability date. See AN-WP/8086, Preliminary Review of a Proposed Amendment to Annex 3 and Consequential Amendment to the PANS-ABC.
- 151.
Standard 9.1.1. Annex 14 to the Convention on International Civil Aviation (Aerodromes), Fourth Edition, July 2004, at p. 9-1.
- 152.
- 153.
- 154.
Arpino (1994).
- 155.
- 156.
See Hood v. Dealers Transport Co., 459F.Supp. 684. It is also noteworthy that one jurisdiction in the United States has followed the approach that the lack of a licence of competence per se does not give rise to liability if the absence of licence was not the proximate cause of the injury. See Laughlin v Rose, 200 Va. 127, 104S.E. 2d 782 (1958) and White v Edwards Chevrolet Co. 186 Va. 669, 43S.E. 2d 870 (1947).
- 157.
Department of Water and Power of City of Los Angeles v Anderson 95F.2d 577. See also, Cox v Dubois, 16F.Supp. 2d 861, Brantley v Vaughn, 835F. Supp. 258.
- 158.
Supra.
- 159.
Becker (2002).
- 160.
Blaise Pascal, in his book Ars Cogitandi states that fear of harm ought to be proportional not merely to the gravity of the harm but also to the probability of the event. It is also a fact of risk management that, under similar conditions, the occurrence (or non-occurrence) of an event in the future will follow the same pattern as was observed in the past. For a discussion on risk assessment and risk management see Ferguson (2008) and Bobbitt (2008).
- 161.
Airport Planning Manual, Doc. 9184-AN/902, Parts 1 and 2.
- 162.
Id. Part 1, 2.9.1 (a).
- 163.
Doc. 9184-AN 902 Part 2, 1.3.1.
- 164.
Id. 1.3.2.
- 165.
Airport Planning Manual, Doc 9184-AN/902, Part 3.
- 166.
Id. 1.3.1–1.3.5.
- 167.
Id. Chapter 2.2.1.
- 168.
Id. 2.4.
- 169.
Id. 3.1.
- 170.
Id. Appendix.
- 171.
http://www.airbus.com/en/gmf2009/appli.htm?onglet=&page=. The forecast anticipates that in the next 20 years, passenger traffic RPK’s will remain resilient to the cyclical effects of the sector and increase by 4.7% per year or double in the next 15 years. This will require a demand for almost 24,100 new passenger aircraft valued at US$2.9 trillion. With the replacement of some 10,000 older passenger aircraft, the world’s passenger aircraft fleet of 100 seats or more will double from some 14,000 in 2009.
- 172.
Id. The forecast states that the greatest demand for passenger aircraft will be from airlines in Asia-Pacific and emerging markets. The region that includes the People’s Republic of China and India accounts for 31% of the total, followed by Europe (25%) and North America (23%). In terms of domestic passenger markets, India (10%) and China (7.9%) will have the fastest growth over the next 20 years. The largest by volume of traffic, will remain domestic US.
- 173.
See Naval Taneja, Technology enabled game changing models, http://www.airlineleader.com/_webapp_1098704/Technology-enabled_game-changing_airline_business_models.
- 174.
Michael Rogers’ Commentary on the 20th ACI World Annual General Assembly at http://www.airtransportnews.aero/analysis.pl?acateg+reports.
- 175.
Patrick Becker, Corporate Foresight in Europe: A First Overview, supra, note 30 at 8.
- 176.
Airport Planning Manual, Doc 9184-AN/902, Part 3.
- 177.
Id. 1.3.1–1.3.5.
- 178.
Id. Chapter 2.2.1.
- 179.
Id. 2.4.
- 180.
Id. 3.1.
- 181.
Id. Appendix.
- 182.
Supra note 176 at p. 22.
- 183.
Standard 2.9.1, Annex 14 to the Convention on International Civil Aviation, Aerodromes, Volume 1 Fourth Edition: July 2004 at 2–4.
- 184.
Recommendation 10.2.9.
- 185.
Recommendation 10.2.11.
- 186.
For a discussion on this subject, See Abeyratne, Airport Business Law, Supra, note 15, at pp. 106–108
- 187.
Article 68 provides that Each contracting State may, subject to the provisions of this Convention, designate the route to be followed within its territory by any international air service and the airports which any such service may use.
- 188.
ICAO’s Policies on Charges for Airports and Air Navigation Services Doc 9082/8 Eighth Edition-2009.
- 189.
See IPCC Fourth Assessment Report, infra, note 1078 at p. 352.
- 190.
The Protocol will enter into force 90 days after “not less than 55 Parties to the [Climate Change] Convention, incorporating Parties included in Annex 1 which accounted in total for at least 55% of the total carbon dioxide emissions for 1990 of the Parties included in Annex 1” have ratified (Art. 24 of the Protocol).
- 191.
Report of the Committee on Aviation Environmental Protection, Fifth Meeting, Montreal, Jan. 8–17, 2001, ICAO Doc 9777, CAEP/5 at 1A-1.
- 192.
Currently, the world uses 3,917 Mega tonnes (Mt) of liquid fuel annually 3, including approximately 0.02 Mt of biofuel, very little of which is consumed by international aviation. Most fuel use is for direct combustion, emitting carbon dioxide (CO2) in direct proportion to fuel burn. Preliminary estimates from ICAO’s Committee on Aviation Environmental Protection (CAEP) indicate that global aviation fuel burn is expected to grow from approximately 200 Mt in 2006 to between 450 and 550 Mt in 2036. Not accounting for the impact of alternative fuels, but considering the effects of improved efficiency and aircraft technologies, CO2 is predicted to grow from 632 Mt in 2006 to the range of 1,422–1,738 Mt in 2036. At the time of writing, these results have not yet been reviewed or accepted by CAEP and should therefore be considered preliminary.
- 193.
The current environmental activities of the International Civil Aviation Organization (ICAO), see infra note 25, are largely undertaken through the Committee on Aviation Environmental Protection (CAEP), which was established by the Council in 1983, superseding the Committee on Aircraft Noise (CAN) and the Committee on Aircraft Engine Emissions (CAEE). CAEP is composed of members and observers. In 1998, the Assembly requested that States from regions that are not represented or under-represented in CAEP participate in the Committee’s work. Some progress has been made in this regard and efforts continue to attract new participants. CAEP assists the Council in formulating new policies and adopting new Standards on aircraft noise and aircraft engine emissions. CAEP’s Terms of Reference and Work Programme are established by the Council. The current structure of the Committee includes five working groups and one support group. Two of the working groups deal with the technical and operational aspects of noise reduction and mitigation. The other three working groups deal with technical and operational aspects of aircraft emissions, and with the study of market-based measures to limit or reduce emissions such as emissions trading, emissions-related charges and voluntary measures. The support group provides information on the economic costs and environmental benefits of the noise and emissions options considered by CAEP.
- 194.
ICAO doc. CAAF/09-WP/3, 16/10/09.
- 195.
Id. at 4. In April 2007 in its Fourth Assessment Report, the IPCC stated: “The introduction of biofuels could mitigate some of aviation’s carbon emissions, if biofuels can be developed to meet the demanding specifications of the aviation industry, although both the costs of such fuels and the emissions from their production process are uncertain at this time”. See the Report at http://www1.ipcc.ch/pdf/assessment-report/ar4/wg3/ar4-wg3-chapter5.pdf at p. 352.
- 196.
Particulate matter (PM) from fuel combustion is a mixture of microscopic solids, liquid droplets, and particles with solid and liquid components suspended in air. Solid particles, such as soot or black carbon, are referred to as non-volatile particles. Volatile PM is comprised of inorganic acids (and their corresponding salts, such as nitrates and sulphates), and organic chemicals from incomplete fuel combustion.
- 197.
Taylor (2009).
- 198.
Brunelle-Yeung (2009).
- 199.
U. S. Environmental Protection Agency, Review of the National Ambient Air Quality Standards for Particulate Matter; Policy Assessment of Scientific and Technical Information, http://www.epa.gov/ttn/naaqs/standards/pm/data/pmstaffpaper_20051221.pdf, December 2005.
- 200.
Altman (2009).
- 201.
Daggett et al. (2007).
- 202.
Walther et al. (1995).
- 203.
Caldecott and Tooze (2009) (notes “…best estimates of current minimum production costs are approximately US$100–130 per barrel …”; Start-up biofuel firm Solix currently producing fuel from algae at $32.81/gallon but expects costs to come down as better design improves production integration.
- 204.
See ICAO Doc CAAF/09-WP/23, 18/11/09.
- 205.
The High Level Meeting on Aviation and Climate Change, convened by the International Civil Aviation Organization from 7 to 9 October 2009 once again brought to bear the vexed issue of ICAO’s leadership in the field, only to be re-endorsed by the 56 States which attended the Meeting, that ICAO was indeed the leader and that ICAO should provide guidance on various issues pertaining to the subject. The meeting went on to acknowledge the principles and provisions on common but differentiated responsibilities and respective capabilities, and the fact that developed countries will be taking the lead under the UNFCCC and the Kyoto Protocol. It also acknowledged the principles of non-discrimination and equal and fair opportunities to develop international aviation set forth in the Chicago Convention and re-emphasized the vital role which international aviation plays in global economic and social development and the need to ensure that international aviation continues to develop in a sustainable manner.
- 206.
At the United Nations Framework Convention on Climate Change 15th Meeting of the Conference of the Parties (COP15) and the Fifth Meeting of the Parties to the Kyoto Protocol (CMP5) which were convened in Copenhagen on 8 December 2009, leaders from the U.S., India, Brazil, South Africa and China came to an agreement to combat global warming. The deal, which was only between five countries, contained no specifics on emissions cuts, but it did commit the countries to look to keep global warming at 2°C or less and to promise $30 billion in funding to battle climate change by 2012. It also created a framework for international transparency on climate actions for developed and developing nations alike.
- 207.
The ICAO Assembly is convened once every 3 years by the ICAO Council to discuss the policy of the Organization. The 37th Session of the Assembly was scheduled for 28 September to 8 October 2010.
- 208.
- 209.
Commentators are of the view that the agreement reached is far from perfect – and a long way from what environmentalists were hoping from the Copenhagen summit just a few months ago. However, some believe it is a start. President Obama is reported to have stated that for the first time, all major economies have come together to accept their responsibility to combat climate change and that the Copenhagen agreement is a consensus that will serve as the foundation for global action against climate change for years to come. See http://www.time.com/time/specials/packages/article/0,28804,1929071_1929070_1948974,00.html?cnn=yes.
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Abeyratne, R. (2012). Sustainable Development of Air Transport. In: Strategic Issues in Air Transport. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-21960-3_5
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