EU lawmakers act to address ‘unfair’ airline competition rules

Some EU airlines, notably Air France-KLM and Lufthansa, have long complained about what they see as unfair competition from carriers such as those in the Gulf region. (Reuters)
Updated 20 March 2018
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EU lawmakers act to address ‘unfair’ airline competition rules

Non-EU carriers could see their rights to fly in the bloc revoked if they or their home countries engage in “unfair” competitive practices under rules voted on by a European Parliament committee on Tuesday.
Some EU airlines, notably Air France-KLM and Lufthansa, have long complained about what they see as unfair competition from carriers such as those in the Gulf region — Emirates, Etihad and Qatar Airways — whom they accuse of receiving illegal state subsidies.
The three airlines have vehemently denied such claims.
While the rules passed by members of the European Parliament’s transport committee on Tuesday are not the final version of the law, they represent a hardening of the original European Commission proposal.
“The pressure from highly subsidized third country carriers is increasingly noticeable. It potentially undermines a level playing field in the market, at the expense of European airlines,” said Markus Pieper, the EU lawmaker who is steering the legislation through the European parliament.
“Particularly carriers from the Gulf region, Turkey, China and Russia have strong state connections which can cause market distortions.”
The proposal would allow EU governments and airlines to submit complaints to the European Commission about alleged discriminatory practices they face in non-EU countries or illegal subsidies benefiting non-EU airlines.
The version passed by the European Parliament would see the Commission being able to impose “provisional redressive measures” on third country airlines even before an investigation has been concluded to prevent irreversible injury.
The provision was pushed by the second largest group in the Brussels legislature, the Socialists and Democrats.
The Commission — the EU executive — had not originally proposed curtailing airlines’ flying rights as these are typically granted on a bilateral basis between governments.
Instead it had proposed financial penalties or other measures such as a suspension of ground services.
The Commission has denied that the proposed regulation is a protectionist measure, but many EU governments oppose it on the grounds that it could hurt transport links to their countries.
The Gulf airlines have faced similar pressure in the US.
Qatar recently agreed to release detailed financial information about state-owned Qatar Airways after talks with the US government.
EU lawmakers will have to reach an agreement with member states on a final version of the EU regulation before it can take effect, meaning it will likely undergo further changes.


VW to stop doing business in Iran: Bloomberg

Updated 20 September 2018
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VW to stop doing business in Iran: Bloomberg

  • VW will still be able to do some business in Iran under a humanitarian exception
  • VW has scrapped plans it announced in July last year to sell cars in Iran for the first time in 17 years

WASHINGTON: Volkswagen has bowed to American pressure stemming from the US rejection of the multi-party nuclear deal and will end almost all business in Iran, Bloomberg News reported Wednesday.
The accord was reached Tuesday after weeks of talks between the German auto giant and the administration of President Donald Trump, said Richard Grenell, the US Ambassador to Germany, according to Bloomberg.
VW will still be able to do some business in Iran under a humanitarian exception, Bloomberg added.
In May, Trump pulled the US out of the deal it reached with Iran and five other countries in 2015. That accord lifted sanctions against Tehran in exchange for restrictions on its nuclear program.
Now, the US is reimposing those sanctions.
Bloomberg said VW has scrapped plans it announced in July last year to sell cars in Iran for the first time in 17 years.