Published on Wednesday, March 22, 2017
EU officials have warned UK-based airlines that they will have to axe their routes within continental Europe unless they relocate their headquarters to the EU and sell shares to EU nationals post Brexit.
Executives at major carriers have been told during private meetings with officials that to continue to operate on routes within the continent they must have a significant base on EU territory and that a majority of their shares must be EU-owned, according to the Guardian.
Some airlines, including easyJet, have already started to look at ways to obtain an EU operating certificate, including setting up separate operating companies within continental Europe.
However, it is believed that the EU's Brexit taskforce, which met with representatives from British Airways, easyJet, Ryanair and TUI last week, made it clear that the majority of the shares in the airlines must also be EU-owned if they are to continue to operate routes within the Continent, such as Paris - Milan.
Meanwhile, Olivier Jankovec, European leader of international airports council ACI, has expressed concerns about ongoing uncertainty over the rules that will govern aviation between the UK and the EU after PM Theresa May triggers Article 50 next week.
"This needs to be quickly resolved to provide clarity for passengers, airlines and airports so as to enable continued investment in growing our collective connectivity," he said.
"The sequencing of the Brexit negotiations means talks will initially focus on agreeing exit terms for the UK, before they eventually come to define the new relationship between the UK and the EU27 as of 2019.
"This implies that the aviation industry will be left in the dark for many more months to come about what will happen. Unless quickly resolved, this uncertainty will end up constraining route network development for airports, ultimately affecting air connectivity for their communities. This is due to the fact that airline route planning requires both long lead times and legal certainty."
He warned that, due to the strict two-year deadline for Brexit negotiations, it was possible the UK would exit the EU without the terms of a new relationship being clearly defined.
"For aviation, this could well result in market access falling back on more restrictive bilateral provisions between the UK and individual EU27 States - with potentially disruptive effects on air connectivity and the economy.
"In particular, consumers could find themselves having purchased air tickets that airlines might not be able to honour in the absence of an appropriate legal basis for them to fly.
"As responsible businesses, at this stage we simply cannot rule out a cliff-edged scenario for Brexit and aviation. The potential impact of this on air connectivity, consumers and the wider economy needs to be addressed by Brexit negotiators - on both sides.
"This means that adequate contingencies need to be established promptly in case the UK would exit the EU without any agreement on its future relationship with the bloc".
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