ATW Editor's Blog

Why US Senate should not add flag of convenience amendment to FAA bill

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The US lawmaking system depends on the to-and-fro of amendment additions. But Section 530, a provision hitched to the FAA Reauthorization Bill, should it become law, is a particularly egregious proposal that has grave implications for the 120 US Open Skies agreements.

This amendment, as reported here, is a blatant attempt by ALPA and the other union groups to keep out competition and force US labor laws and practices on the non-US airlines that operate, quite legitimately and with full FAA oversight and approval, within the US Open Skies agreements.

Today, all carriers are able to access labor from less expensive markets, provided they satisfy licensing and immigration laws. But no airline has done this in the US, including the carrier that ALPA describes as a “flag of convenience carrier” because it has airlines registered in countries outside the corporate home base where it is majority-owned. Norwegian’s Irish and UK carriers operate to the US under US-EU Open Skies terms. As such, they must abide by the rules of the countries from which they operate, making them as safe as any in the industry; some would argue safer given the stringency of Irish and UK regulatory oversight. In any case, under US law, FAA must certify that an airline is safe to operate before it is allowed to operate in the US. And FAA standards set a high bar.

Another fact to bear in mind is that US airline employment is growing, not declining. Some US carriers are beginning to attract back American pilots who went to overseas airlines during the pre-consolidation years when many US airlines were in the red and furloughing pilots. Today, the US major airline pilots—and, indeed, the flight attendants, mechanics and ground staff— have some of the best-compensated jobs in the world. Yet there is still concern, particularly among regional carriers, of a pilot shortage. There is no talk of a jobs shortage.

Open Skies policy stimulates job growth for all those in the industry--at airlines, airports and manufacturers—in the US and globally. Section 530 could artificially stifle that growth and, in turn, constrain the jobs market.

Nor should US lawmakers be persuaded that this amendment would be dismissed by the US’ many Open Skies partner countries. America’s biggest Open Skies partner, the European Commission (EC), has made it crystal clear that it regards Section 530 as something that would “undermine the foundations” of the US-EU aviation agreement and would compel it to act if it was signed in law. Others would follow the EC’s lead.

The Senate has the chance to dismiss this amendment for what it is; protective and potentially harmful mischief. It should ensure Section 530 progresses no further in the legislative system.

Karen Walker/ATW karen.walker@informa.com

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