Unlikely—but replicating the status quo will be an immense challenge, and time is tickingby Stephen Booth / September 4, 2017 / Leave a comment
The airline industry—and the low-cost carriers EasyJet and Ryanair in particular—was vocally opposed to Brexit during the 2016 referendum campaign. Ryanair boss Michael O’Leary has since issued the stark warning that if there is no deal offering continuity post-Brexit, flights between the UK and the EU will be grounded after March 2019. So, how realistic is this “no fly-zone” scenario and what is at stake for the millions of UK and EU air passengers and our cheap holidays during the Brexit negotiations?
Liberalisation of air travel is a significant EU achievement. It has created a single aviation market across Europe that extends beyond the EU itself—agreements are in force or under negotiation from Iceland to Israel, and the ultimate ambition extends to incorporating “50-55 states with a total population of up to a billion.” ThisEuropean Common Aviation Area (ECAA) created a number of “freedoms” for airlines of signatory countries which allows them to have one base in a member state and operate within other states. For example, EasyJet, registered in the UK, can fly without restriction from the UK to the rest of the EU, between other European states (Italy-Germany) and within other EU countries (Nice-Paris). As a result of this liberalisation, which occurred in the 1990s, the number of routes on offer has grown significantly. Liberalisation has not been confined to Europe, but fares from the UK to EU destinations have fallen much faster than fares for flights across the Atlantic or the rest of the world.
Understandably, the industry is still heavily regulated and airlines need legal permission to fly. Failure to reach any Brexit agreement at all would mean relying on outdated bilateral air agreements with individual EU member states. These pre-date the creation of the single European aviation market, and there is a great deal of uncertainty about their validity. However, it is virtually impossible to imagine a scenario under which flights between the UK and the EU are grounded as O’Leary has warned—both sides benefit from air connectivity and the UK has the third largest aviation sector globally. The EU already has a plethora of aviation agreements with third countries. The questions really are: what type of agreement can be reached, on what terms and what this will mean for services?
There are a number of potential forms that a deal between the UK and the EU…