The European Commission and the State of Qatar initialled today an aviation agreement, the first such agreement between the EU and a partner from the Gulf region.
The agreement will upgrade the rules and standards for flights between Qatar and the EU and will set a new global benchmark by committing to strong, fair competition mechanisms, and including provisions not normally covered by bilateral air transport agreements, such as social or environmental matters.
Commissioner for Transport Violeta Bulc said: “We delivered! Qatar was the first partner with whom we launched negotiations following our adoption of the Aviation Strategy for Europe – now it is also the first one to cross the finish line! More than that – the agreement sets out ambitious standards for fair competition, transparency or social issues. It will provide a level playing field and raise the bar globally for air transport agreements. This is a major upgrade compared to the existing framework, and our joint contribution to making aviation more sustainable!”
Going far beyond traffic rights, the EU-Qatar agreement will provide a single set of rules, high standards and a platform for future cooperation on a wide range of aviation issues, such as safety, security or air traffic management. The agreement also commits both parties to improve social and labour policies – an achievement which existing agreements between Qatar and individual EU Member States have not provided so far.
In particular, the agreement includes the following elements:
- A gradual market opening over a period of five years to those EU Member States which have not yet fully liberalised direct connections for passengers: Belgium, Germany, France, Italy and the Netherlands.
- Provisions on fair competition with strong enforcement mechanisms to avoid distortions of competition and abuses negatively affecting the operations of EU airlines in the EU or in third countries.
- Transparency provisions in line with international reporting and accounting standards to ensure obligations are fully respected.
- Provisions on social matters committing the Parties to improve social and labour policies.
- A forum for meetings addressing all issues, and any potential differences at an early stage, plus mechanisms to quickly resolve any disputes.
- Provisions facilitating business transactions, including the removal of existing obligations for EU airlines to work through a local sponsor.
The agreement will benefit all stakeholders by improving connectivity through a fair and transparent competitive environment, and create strong foundations for a long-term aviation relationship.
According to an independent economic study undertaken on behalf of the Commission, the agreement, with its robust fair competition provisions, could generate economic benefits of nearly €3 billion over the period 2019-2025 and create around 2000 new jobs by 2025.
The European Commission negotiated the agreement on behalf of the European Member States as part of its Aviation Strategy for Europe – a milestone initiative to give a new boost to European aviation and provide business opportunities. The negotiations were successfully concluded on 5 February 2019.
Following today’s initialling, both parties will prepare the signature of the agreement following their respective internal procedures. The agreement will enter into force once both internal procedures will be finalised.
Qatar is a close aviation partner for the European Union, with more than 7 million passengers travelling between the EU and Qatar per year under the existing 27 bilateral air transport agreements with EU Member States. While direct flights between most EU Member States and Qatar have already been liberalised by those bilateral agreements, none of them include provisions on fair competition and other elements, such as social issues, that the Commission considers essential elements of a modern aviation agreement.
In 2016, the European Commission, therefore, obtained authorisation from the Council to negotiate an EU-level aviation agreement with Qatar. Since September 2016, the negotiators have met for five formal rounds of negotiations, in the presence of observers from EU Member States and stakeholders.
This agreement is part of the EU’s concerted efforts to ensure open, fair competition and high standards for global aviation, in line with the ambitious external agenda put forward with the Aviation Strategy for Europe. Parallel negotiations with ASEAN are at an advanced stage, and negotiations are also ongoing with Turkey. The Commission also has a negotiating mandate for aviation agreements with the United Arab Emirates and Oman. EU negotiations with Ukraine, Armenia and Tunisia have been finalised and the agreements are pending signature.
Brussels, 4 March 2019
The European Cockpit Association reacts
After two and a half years of negotiations, the EU and Qatar have reached a Comprehensive Air Transport Agreement (CATA) providing increased access to each other’s markets. EU and Qatari airlines will enjoy 3rd and 4th freedom traffic rights for passenger flights and ‘limited’ 5th freedom rights for cargo operations. This market opening is in line with the EU’s quest for further liberalisation in aviation and its ambition to reach agreements with other 3rd countries. While such agreements provide a unique opportunity for the EU to include much-needed clauses on fair competition and social protection they should also bring in fresh commercial opportunities for our airlines. This is where an EU-Qatar deal falls short.
The economic benefits of this Agreement seem to be heavily concentrated on the side of Qatar, which will now have direct access to 28 EU countries, 500 million customers and a large cargo market. The EU is gaining access to one single consumer market in an isolated region, with only 3 million customers.
“Without wishing to downplay Qatar’s role as a global aviation player, it is only one country in a sparsely populated area and which hardly matches the opportunities provided by the access to the huge EU market. This prompts the question why is the EU so eager to cut deals that undervalue its own aviation market? I’m afraid the answer is that aviation is still considered a bargaining chip in a wider macro-economic or political strategy. EU airlines and their employees shouldn’t pay the price of this short-sighted approach to external aviation policy,” says ECA President Jon Horne.
This is a concern for most of the current EU negotiations with 3rd countries. Those countries can benefit from the access to the EU aggregated market without this market being recognised as the one single economic entity it is in reality. Flying from e.g. Madrid to Helsinki is not considered ‘cabotage’, i.e. the right for foreign carriers to operate domestically. Under such comprehensive agreements, the parties obtain great flexibility in routing their traffic in each other’s territory. The flexibility of co-terminalisation, intersecting stop-overs and a network of multiple ‘national’ routes combine to give third country carriers de facto the possibility to directly compete with EU airlines on the EU network, but without being subject to the same set of rules. A flagrant example are the different levels of social protection for workers in the EU and Qatar.
“We are worlds apart when it comes to labour rights and employment conditions,” says Jon Horne, ECA President. “Qatar has a reputation of ignoring fundamental labour rights, not recognising unions or collective bargaining. It is unlikely that any ‘social clause’ – even if it includes ironclad social guarantees – would work out such large differences. However, we welcome the social clause negotiated by the EU as an important and much-needed component of the agreement. It should definitely be used as a tool to ensure fundamental workers’ rights are respected and that lower Qatari social standards are not used to outcompete European airlines.”
The Agreement’s social clause recognises that the violation of fundamental labour principles and rights at work cannot be used as a legitimate comparative advantage. Both EU and Qatar pledge to adopt and modify their domestic laws to be in line with ILO obligations. And the clause will apply to any future, more liberal bilateral deals that Qatar reaches with individual EU Member States.
Another key component of the Agreement is the ‘fair competition clause’, which is particularly comprehensive and ambitious, covering not only subsidies but also discriminatory practices. “You will hear today lots of praise for the fair competition and social clauses. But we remain to be convinced that they will make a real difference in practice,” says ECA Secretary General Philip von Schöppenthau. “From experience, we know that even the best, supposedly watertight clauses, mean nothing without the political will and true commitment of the EU to enforce them. We hope this element will blow real life into the agreement and ensure that opening our doors will not harm our airlines and the quality employment they provide in Europe.”
Brussels, 4 March 2019
Airports & Tourism organisations applaud EU-Qatar aviation agreement
As the ink dries on the initialisation of the EU-Qatar aviation agreement, the European airport industry and Tourism sector today hailed the moment as important to the further expansion of air connectivity for Europe’s airports and the communities they serve.
This agreement provides for a balanced & progressive lifting of restrictions for airlines to fly between the EU and Qatar – a major global aviation player – and also includes appropriate safeguards to ensure fair competition. This will facilitate the development of new air services, providing increased benefits for consumers and supporting the economy – in particular, tourism on both sides.
Recalling their joint position in favour of ‘Open Skies’ released in 2015¹, ACI EUROPE and the European Travel Commission (ETC) underlined their support for the agreement initialled today. They also stated their hope for more such agreements with other EU trading partners going forward.
Olivier Jankovec, Director General ACI EUROPE commented “Europe’s airports rely on open skies to attract airlines and develop their route network. This is about enhancing connectivity for our communities and providing more choice for consumers. Today’s EU-Qatar aviation agreement is an important step in the implementation of the EU Aviation Strategy. Crucially, it signals that Europe remains committed to a liberal and open aviation policy – with consumer interest & wider economic benefits at the forefront.”
Eduardo Santander, Executive Director, European Travel Commission commented “The Tourism industry highly welcomes the EU-Qatar aviation agreement. Air connectivity has a strategic relevance for the European tourism & travel sector with air transport being the only way for most international tourists to get into Europe. Liberalization of the aviation market is essential to maintain Europe’s number 1 position as a tourist destination and ensure the continued contribution of the sector to the European economy”.
Brussels, 4 March 2019