Opinion of the Economic and Social Committee on the 'Communication from the Commission to the Council, the European Parliament, the Economic and Social Committee and the Committee of the Regions - The European Airline Industry: from Single Market to Worldwide Challenges'
Date: 2000-01-26
Institutions: European Economic and Social Committee
Subjects: Europe, air transport, competition law, transport safety, vocational training

C 75/4

EN

Official Journal of the European Communities

15.3.2000

would however stress that it can only be a step towards a fuller
and more ambitious measure. Efforts must in particular be
pursued to ensure that the principle of the uniqueness and
universality of insolvency is acknowledged.

4.2.
The Committee therefore feels that at the very least,
the emphasis of the text should be shifted to strengthening
main rather than secondary proceedings. One way of doing
this might be to reinforce the powers of the liquidator in the

main proceedings, and to provide broader opportunities for
securing stay of secondary proceedings.

The Committee is pleased to note that an evaluation
4.3.
clause was added to the Brussels Convention shortly before it
was finalised. Under this provision, the system as set up may
be evaluated at the request of a contracting state and in any
case ten years after its implementation (Article 53). A similar
provision should be inserted into the proposed regulation.
However, in the Committee’s view, this evaluation should take
place after five years.

Brussels, 26 January 2000.

The President

of the Economic and Social Committee

Beatrice RANGONI MACHIAVELLI

Opinion of the Economic and Social Committee on the ‘Communication from the Commission
to the Council, the European Parliament, the Economic and Social Committee and the Committee
of the Regions — The European Airline Industry: from Single Market to Worldwide Challenges’

(2000/C 75/02)

On 20 May 1999 the European Commission decided to consult the Economic and Social Committee,
under Article 262 of the Treaty establishing the European Community, on the above-mentioned
communication.

The Section for Transport, Energy, Infrastructure and the Information Society, which was responsible for
preparing the Committee’s work on the subject, adopted its opinion on 21 December 1999. The
rapporteur was Mr von Schwerin.

At its 369th plenary session of 26 and 27 January 2000 (meeting of 26 January) the Committee adopted
the following opinion with 116 votes in favour and three abstentions.

1.

Introduction

1.1.
In its Communication The European Airline Industry:
From Single Market to Worldwide Challenges the Commission
looks at the current state of the European airline industry, the
need for continuing improvement of the competitiveness of
European airlines and the past ten years of liberalisation of air
transport.

1.3.
The Commission considers that European airlines have
developed innovative strategies in order to adapt themselves
to market growth and competition challenges. During the
last decade they have achieved considerable productivity
improvements, which now permits the sector to create new
jobs. However, the sector still suffers from a high degree of
fragmentation and financial fragility when compared to its
main competitors, notably North American carriers.

The aim of the communication is to assess the progress
1.2.
made and to identify the initiatives which can contribute to
the competitiveness of the industry.

Liberalisation and globalisation make the market
1.4.
increasingly competitive and require airlines to undertake large
restructuring efforts.

15.3.2000

EN

Official Journal of the European Communities

C 75/5

1.5.
The Commission authorised state aid as a one-off
measure to help national carriers to restructure during the
transition to the liberalised single market. This transition is
now over, however.

2. Gist of the Commission Communication

To help the industry towards this strategy, the Com-

1.6.
mission has drawn up the following policy orientation:

‘The Commission uses all the tools at its disposal to ensure
integration of the European market. This includes the
application of EC competition law to prevent attempts to
re-fragment the market through public intervention or
anti-competitive alliances or mergers. The monitoring
the transparency of
of public and private behaviour,
Community legislation and the definition and dissemi-
nation of best practices on a number of issues such as
Public Service Obligations, are important elements in this
regard.

The elimination of technical obstacles to trade, in particular
by faster and more efficient harmonisation of safety rules
through the creation of a European Aviation Safety
Authority and by giving impetus to ICAO activities in the
environment field will help the industry.

The fragmentation of the internal market results also from
the lack of an external dimension. Ownership rules and
the bilateral agreements system create obstacles to industry
restructuring at European level and to fair competition
with the open skies countries. These economic conse-
quences add to legal justifications for a genuine external
dimension permitting to insert the alliances within a fair
European framework.’

The Commission considers air transport

2.1.
to be a
high-growth industry, but cyclical and with uncertain profita-
bility. Economic growth is the main force driving demand for
transport. In recent years air transport recorded a strong
growth in the volume of output produced and sold. According
to the latest market studies, world-wide demand for air travel
will continue to grow strongly in the next two decades, at a
rate of about 5 % per year, although account has to be taken
of major unforeseen events such as the recent financial and
economic crisis in south-east Asia.

2.2.
The Commission looks at the competitiveness of the
European airline industry in comparative international terms
and comes to the conclusion that the largest European airlines
are similar in size to the largest American ones but a typical
characteristic of the European airline industry is the existence
of a second layer of relatively small airlines with a global
vocation. This may partly explain the limited profitability of
the European industry, since in the global airline industry size
is an important efficiency factor.

2.3. With regard to the structure of the industry, the
Commission points out that the opening-up of a market
previously protected from competition usually results in a first
phase in which the number of participants in the industry
increases. This is followed by a second phase of consolidation
whereby the number of firms decreases and their size increases.
Air transport seems to have followed this process in the USA.
Europe still seems to be in the first phase. In 1993 Europe had
132 airlines performing commercially significant scheduled
operations; in 1998 it had 164.

1.7.
The Commission intends to set up a comprehensive
database of the European airline industry. This will increase
the quality and availability of data and analyses on capacity,
traffic, financial performance, productivity, industry and route
structure, airports and employment that are necessary to
support a policy aiming at safeguarding the competitiveness
of the industry. Information and analyses on industry trends
will be available to the general public on the Commission’s
internet site. This tool will enable the Commission to monitor
the evolution of the industry in general and of air fares in
particular.

2.3.1. When comparing the air transport market in the EU
and the USA one should be aware of some important structural
differences. For instance in Europe average distances between
cities are shorter and competition from alternative transport
modes, notably road and railways, is much stronger than in
the US. Of course these aspects explain to some extent the
is striking that Europe, whose
different structure, yet
domestic market is less than one third of North America’s, has
a far higher number of airlines operating large aircraft, 90
against 37. Conversely European carriers’ average size is much
smaller, both in terms of number of aircraft operated (average
fleet of 27 against 111) and market shares. The Commission
concludes that the European airline industry is fragmented.

it

C 75/6

EN

Official Journal of the European Communities

15.3.2000

2.4.
A major aspect of structural change is the emergence
of a new operating strategy for airlines, hub-and-spoke oper-
ations, now followed by major carriers. By reducing the
number of direct routes, traffic flows are condensed, permitting
the use of larger aircraft and operation at higher load factors.
Some airlines pursue low-cost, no-frills strategies based on
features such as no interlining, no pre-assigned seat selection,
food, single class of service, use of cheap,
no in-flight
uncongested secondary airports and uniform fleets of new and
fuel-efficient aircraft.

— A new directive on airport charges is now in the process

of being adopted.

— The fragmentation of the air traffic management systems
is addressed through the strengthening of the Eurocontrol
organisation.

— The Community is actively taking part in creating the

European Air Safety Authority (EASA).

2.5.
On the subject of productivity, the Commission states
that in the period 1990 to 1996 the 10 largest European
airlines recorded on average a 53 % increase in revenue tonne
kilometre (RTK) per staff, while their cost available tonne
kilometre (ATK) went down by 13 %. The productivity of the
10 largest American airlines is still higher, however, meaning
that restructuring efforts need to be continued.

2.6.
The Commission believes that airlines are facing
increasingly complex situations. Notably, ongoing demand for
improved products in terms of more destinations and more
frequencies requires the ability to innovate and greater financial
resources. If European airlines are to survive and flourish in
this increasingly competitive environment, permanent restruc-
turing, that is ongoing improvements in efficiency and com-
petitiveness, is necessary. Much of the increase in competition
has come from the EU liberalisation measures in the industry.
However it should be noted that this process has not intro-
duced competition on all markets. The Commission’s own
1996 report on the impact of the third package of liberalisation
measures noted that 64 % of EC routes were operated as
monopolies, although many of these are new or thin routes,
and that fares for business passengers had not decreased.

2.7.
In its 1994 Communication The way forward for civil
aviation in Europe (1) the Commission identified scarcity and
cost of infrastructure as a main cause of the high costs incurred
by European air travellers. To improve this situation, the
Commission has, in recent years, been carrying out initiatives
targeting infrastructure:

— The adoption of Directive 96/67 liberalising access to the
ground handling market for third parties at Community
airports.

— The Commission will reflect on the issue of environmental
protection and its interaction with aviation competi-
tiveness in a future communication.

To ensure long term success in the increasingly glo-
2.8.
balised air transport market, the Commission believes that
European airlines need to develop into globally competitive
entities. The relationship between flag carriers and regional
airlines is moving beyond the simple practice of commercial
agreements towards more advanced forms of integration such
as franchising or direct control through acquisition. Four
global strategic alliances (Star Alliance, One World, Wings,
Qualiflyer) have emerged with the participation of European
airlines.

2.9.
The Commission is critical of the fact that, because of
existing bilateral agreements there is not yet freedom to
provide service between the Member States and countries
outside Europe. A particularly negative consequence of the
bilateral system is that European airlines normally cannot fly
to non-Member States from any point in the EU but only from
the territory of their home Member State. This particularly
disadvantages European airlines in comparison with American
carriers who can fly from any airport in the USA to a wide
range of airports in the EU. Therefore it is important to
complete the single aviation market with a genuine external
dimension. Common agreements between the European Union
as a whole and third countries have to be negotiated, the
Commission feels, both at multilateral and bilateral level. The
Commission will continue its efforts to achieve the creation
of a Common Aviation Area with the USA. Furthermore
consideration must be given to the position of air transport in
the new round of negotiations under the General Agreement
on Trade in Services (GATS) of the WTO, which resumed in
1999.

the last

The Commission looks at

2.10.
ten years of
liberalisation of the air transport industry. The Commission
assessed these developments in 1996 in its Communication
entitled Impact of the third package of air transport liberalis-
ation measures (2) noting that the liberalisation process had
mutated the economic environment
for air transport by
making it an increasingly competitive market. The first three
liberalisation had resulted in gradually growing
years of
competition; in particular the number of carriers considerably
increased. Liberalisation had brought clear benefits to con-
sumers. However, some shortcomings might weaken the

(1) COM(94) 218 final — ESC Opinion OJ C 110, 5.2.1995, p. 22.

(2) COM(96) 514 final, 22.10.1996.

15.3.2000

EN

Official Journal of the European Communities

C 75/7

liberalisation process’ ability to deliver to the consumer better
services at lower cost. The report highlighted the problem of
capacity restrictions and high costs for infrastructure as well
as the contradictory and unsatisfactory trend concerning fares.
Promotional fares had become more widespread. There were
still
large differences in fares per kilometre across Europe,
however. There had even been price rises on lucrative routes.
Recent developments confirmed the trend.

2.11.
The Commission argues that the proliferation of
tariffs, over-booking, the availability of seats at the most
publicised promotional fares, the growth in frequent flyer
programmes (FFPs), code-sharing and airline alliances can all
make it harder for consumers to compare competing offers.
As competition increases, market transparency needs to be
assured,
if consumer confidence is to be maintained. The
Commission has also commissioned a study to examine the
information passengers need to make rational choices.

2.12.
Leasing of aircraft registered outside the Community
is another area of concern. The Commission has noticed that
Member States follow different practices for the implemen-
tation of the provisions on the granting of operating licences.
The Commission, in co-operation with the Member States,
therefore intends to prepare guidelines to clarify its interpret-
ation of the provisions on short-term leases of non-EU aircraft.

2.13.
The Commission has carried out a study on the
impact of regulation and certain commercial practices on the
development of competition in the air transport market. A
number of small and medium-sized airlines were interviewed
and asked to assess the liberalisation process and its short-
comings. The study found that there is an overall consensus
that the present regulatory regime is working well. There were
concerns, inter alia, on the following points:

— There are insufficient slots enabling new applicants airlines

to compete ‘head-to-head’ with established airlines.

— Only larger airlines are able to operate loyalty schemes.
The key barriers reside in the fact that FFPs favour airlines
with large networks, which offer travellers greater chances
to accumulate and use FFP points. In contrast there is little
scope for small and medium carriers to operate such
schemes, because their networks are too small to make
them attractive.

2.14.
The Commission looks at the social impact of current
trends and notes that following the restructuring measures
adopted by airlines, between 1988 and 1996 the overall
number of employees in civil aviation increased from 435 400
to 489 700 and that the outlook for employment in this sector
remains positive.

2.14.1.
One of the main features of the period under review
is the spreading of new forms of employment aimed at
increasing flexibility. Conditions of employment have been
modified, particularly for newly hired employees. Many of
them are now granted fixed term contracts and, in many cases,
a two-tier pay system is applied. Performance related pay
schemes tend to replace seniority pay schemes for some
categories of employees. This trend is not specific to the air
transport industry, however. And for longer service employees
job security remains relatively good at flag carriers. Further-
more, the level of wages is still higher there than at smaller
airlines for similar jobs.

3. The Committee’s comments

3.1.
The Committee welcomes the Commission’s in-depth
analysis of the problems of the airline industry. The assess-
ments and analyses contained in the communication are to a
great extent correct. The goal of strengthening the competi-
tiveness of European airlines, particularly vis à vis their US
competitors, and of eliminating their structural disadvantages
deserves wholehearted support.

3.2.
The Committee regrets that the Commission considers
air transport in isolation from other modes of transport, and
considers that the Commission should, as a matter of urgency,
put the linking of the various modes of transport on the
agenda. The Committee considers stronger links between air
and rail transport to be particularly necessary for environmen-
tal reasons, as in this way short-haul flights could be consider-
ably reduced. But intermodality could also bring considerable
benefits for consumers if they were thus able to reach their
destinations more quickly, comfortably and cheaply.

3.3.
The Committee fails to see any greater emphasis being
placed on passenger rights. The Commission unfortunately
deals with this only in passing. Passenger rights need to be
improved, particularly on code-sharing flights. In view of
increasing over-booking and delays it is urgently recommended
that the regulation providing for an improved system of
compensation for denied boarding and other inconveniences
in scheduled air transport finally enter into force. Passenger
rights must be firmly enshrined in the law. It must be made
possible to take action against the cause of denied boarding,
delays or other inconveniences etc. It should also be borne in
mind, however, that airlines are not exclusively to blame for
delays. A main cause of delay is air traffic control bottlenecks
in Europe.

C 75/8

EN

Official Journal of the European Communities

15.3.2000

The Committee notes that

3.4.
the Commission deals
with charter/holiday traffic only in passing. The Commission
appears to make no distinction between scheduled and charter
traffic, although different conditions sometimes apply and
although charter flights account for a major share of civil
aviation. Particularly in view of the fact that with the liberalis-
ation of air transport it has become increasingly difficult to
draw a dividing line between scheduled and charter traffic,
the Committee recommends that conditions applying to
charter/holiday traffic which differ from those applying to
scheduled traffic be studied in more detail.

3.5.
The Committee feels that the Commission should have
studied the future prospects of air transport and the problems
consequently to be expected in greater detail.

3.6.
The Commission at the same time deplores the high
degree of fragmentation of the air transport sector and calls
for more competition. There is a contradiction here. A large
number of airlines is not necessarily a bad thing. It can in fact
promote competition. Apparently the Commission considers
the number of European airlines operating large aircraft to be
It is unclear,
too high and expects market consolidation.
however, what the Commission considers to be the optimum
structure for a viable and competitive European industry in
terms of number of airlines, size of companies, size of fleet
and market share.

that

The Commission’s statement

3.7.
the transitional
period for the granting of state aid is now over and that these
were one-off measures to help national carriers to restructure
during the transition to the liberalised single market
is
welcomed. Over the years since liberalisation began the flag
carriers have had sufficient opportunity to adapt to the new
competitive situation. State aid should, therefore, no longer be
granted, as it would distort competition, as indeed it already
has.

3.8.
The Commission’s intention of setting up a compre-
hensive database of prices, safety conditions and staff skills in
the European airline industry and of making this available to
the general public via its internet site is welcomed. As the data
required are presumably already held by the various air
transport organisations (ICAO (1), ECAC (2), IATA (3), AEA (4)]
and national bodies, it would make economic sense to use this
data and to coordinate the building of the database with these
organisations and the national bodies. The Committee feels
that, in building a database, care must be taken to ensure that
the public is provided with reliable data which makes it
possible to compare air transport services on offer.

3.9.
The Commission describes hub and spoke operation
as a new operating pattern for airlines and a major aspect of
structural change. By reducing the number of direct routes,
traffic flows are condensed, permitting the use of larger aircraft
and operation at higher load factors. But hub and spoke
operation is not a new operating pattern. In Europe, unlike the
USA, air transport always used to be handled by a single
national airport, to ensure that international long-haul flights
could be filled. To the Committee’s knowledge there has been
no significant reduction in Europe of existing direct links
between secondary airports. In the interests of maintaining
consumer mobility, the Committee considers is important that
there be no deterioration in services to secondary airports
which perform a useful function in relation to traffic.

3.10.
The Commission is too uncritical of the competitive
policy of some airlines. The external costs of airlines are
comparable. For this reason stronger supervision must be
introduced for all companies which deliberately set out to
achieve a competitive edge via lower pay, the recruitment of
unskilled staff,
lower social standards and non-compliance
with safety regulations, e.g. with regard to the frequency of
maintenance. EU-wide minimum requirements for training,
e.g. training of cabin staff meeting the JAR-OPS (5) standard,
inter alia should be laid down and enforced,
in order to
guarantee minimum quality and safety standards in air trans-
port (6). But all other air transport workers should also receive
minimum basic training and on-going in-service training to
ensure that the quality of air transport services is high. Some
airlines still do not have new, fuel-efficient aircraft, but use old,
cheaply purchased aircraft in order to minimise capital outlay.
This means more noise pollution, higher fuel consumption,
and thus more damage to the environment. At any event, the
Committee feels that airlines should be prevented from making
savings at the expense of the safety of aircraft and thus that of
passengers and crews. The Committee believes that harmon-
ised rules on crew working time are needed in the EU which
should allow sufficient flexibility to accommodate operating
requirements, without, however, prejudicing air transport
safety.

The fact that before 1996 about 64 % of EU routes
3.11.
were operated as monopolies is mainly a result of low demand
on those routes. There was simply not enough potential to
justify the provision of services by another company. State
intervention would therefore be wrong in market terms.

(1) International Civil Aviation Organisation [(ICAO).
(2) European Civil Aviation Conference (ECAC).
(3) International Air Transport Association (IATA).
(4) Association of European Airlines (AEA).

(5) Joint Aviation Requirement Operation (JAR-OPS).
(6) Opinion of the Economic and Social Committee on the Proposal
for a Council Directive on safety requirements and attestation of
professional competence for cabin crews in civil aviation — OJ
C 214 , 10.7.1998, p. 37.

15.3.2000

EN

Official Journal of the European Communities

C 75/9

3.12.
The Commission’s statement that fares for business
passengers have not decreased is untrue. A large number of
fares have been introduced for business travellers too. The
newly introduced flexible fares, cheaper than the normal full
fare, make a choice available to business travellers too. In this
way average fares in business class have also fallen. This is
confirmed by a recent study drawn up for the Commission by
the British Aerospace Consultancy.

3.13.
The Commission’s contention that scarcity and cost
of infrastructure are a main cause of the relatively high costs
of
the European airline industry is entirely accurate, as
confirmed by more recent comparative studies. The Com-
mission could help here by putting forward suitable measures,
e.g. with regard to the structuring of airport charges (1).

3.14.
The Commission’s intention of addressing the frag-
mentation of the air traffic management systems through the
strengthening of Eurocontrol is wholeheartedly supported. The
Committee considers that the negotiations for EU membership
of Eurocontrol should be accelerated. When the EU becomes a
member of Eurocontrol, Eurocontrol decisions taken with EU
participation should be implemented in Community law.

In the Committee’s view, the organisation of air traffic
3.15.
control on national
lines and the plethora of air traffic
control systems in Europe are no longer appropriate; a new
decision-making procedure is needed. The various, uncoordi-
nated air traffic control systems must be replaced by a
single, pan-European system. The Committee proposes that
Eurocontrol be given responsibility for setting uniform stan-
dards within the EU for air traffic control technology and
laying down uniform procedures. The most important require-
ment for achieving rapid improvements in air traffic control is
the introduction of uniform technology throughout the EU
and improved cooperation between national air traffic control
authorities. It must be possible to achieve short-term improve-
ments in ATC-related flight delays without the introduction of
a central, European air traffic control authority. The Committee
considers a central authority of this kind to be a good idea,
however, in the long term and supports its introduction. The
Committee considers that the involvement of private-sector
organisations should be considered, subject to quality guaran-
tees, in order to ensure greater flexibility of national air traffic
control.

3.15.1.
The active involvement of the Community in the
establishment of the European Aviation Safety Association
(EASA) is welcomed, although it is not yet clear whether the
EASA will also be responsible for air traffic control.

(1) Opinion of the Economic and Social Committee on the Proposal
for a Council Directive on access to the groundhandling market
at Community airports — OJ C 301, 13.11.1995, p. 28.

3.15.2.
A Eurocontrol study reached the following con-
clusions on air traffic control problems: In 1998 28 % of all
direct delays were attributable to air traffic control en route
and 4 % to air traffic control ground problems, adding up to a
total of 32 %. If the 37 % of consequent delays were assigned
proportionally, this would add another 19 %. Thus 50-51 %
of all delays had their origin in the air traffic control area, as
compared to 13+8 % (=20-21 %) which were attributable to
the airlines. Eurocontrol fears that the data for 1999 will be
still less favourable.

The Commission’s intention of focusing its attention
3.16.
on the noise and environmental pollution caused by air
transport is also welcomed. The degree to which environmental
responsibilities are fulfilled and public attitudes to air transport
will depend on the efforts made in this area. Protection of the
environment has long enjoyed high priority in air transport.
Divergent local standards, e.g. on exhaust emissions, have,
however, so far prevented a determined technological drive to
develop new engines. The introduction of a kerosene tax is no
solution, unless introduced worldwide in all the ICAO states
in order to prevent distortions of competition.

3.17.
The disadvantages of the fragmentation of the indus-
try identified by the Commission can be countered by the
synergy effects generated by the formation of international
alliances.

The Committee does not share the Commission’s
3.18.
views on air transport alliances in the context of competition
law. Such alliances can make it easier to satisfy customer needs
by making a larger, coordinated network of flight connections
available. This is more advantageous to customers that the
services offered by individual companies. From a competition
point of view, therefore, alliances should be seen in a positive
light. It should be ensured, however, that smaller airlines are
not forced out of the market as a result of abuse of market
dominance.

3.19.
In investigating various alliances on the North Atlan-
tic routes the Commission’s competition DG has focused too
much on individual routes, an approach which is out of step
with current competitive conditions. By contrast, the US
authorities increasingly look at the whole market. And indeed
the majority of passengers on the routes which were the
subject of the Commission’s criticisms would have taken
connecting flights. Harmonisation of the US and European
competition policy is therefore needed.

3.20.
As the Commission is working for an open skies
agreement between the EU and the USA, the Committee
considers that it would be appropriate to await the end of
these negotiations before investigating the compatibility of the
North Atlantic alliances with EU competition law.

3.21.
The Committee endorses the Commission’s reasons
for seeking an open skies agreement with the USA. US airlines
are placed at an unfair advantage by the existing bilateral
treaties, as, in contrast to the European airlines, they are able
to fly from any airport in the USA to almost any airport in
Europe. On the basis of the existing bilateral agreements,

C 75/10

EN

Official Journal of the European Communities

15.3.2000

European airlines, on the other hand, can fly to the USA only
from airports in their home country. This inequality of
treatment should be eliminated as a matter of urgency in the
course of the negotiations on an open skies agreement with
the USA.

3.22.
The opportunity offered by the new negotiating
round within the framework of the General Agreement on
Trade in Services (GATS) should be used to integrate air
transport further into the discussions and to create a harmon-
ised environment for air transport, e.g. overflying rights, slot
allocation and airport services. Efforts should also be made to
achieve the step-by-step liberalisation of air freight transport.

3.23.
The air transport sector should not be more heavily
regulated with a view to market transparency than other
economic sectors. The competition between professional travel
intermediaries in itself ensures sufficient market transparency.

3.24.
For reasons of operating flexibility it is sometimes
necessary to wet-lease aircraft from non-Community countries.
The Committee advocates the adoption of an EU guideline
requiring the wet-leasing of aircraft to be allowed only in
exceptional cases and for a limited period, and then only on
condition that the leased aircraft meet EU minimum safety
and environmental requirements in order to prevent abuses.
Thought would have to be given to a practicable authorisation
procedure.

The slot problem at airports described by the Com-
3.25.
mission is a result of capacity problems at these airports. It is
not only new applicants who suffer from this but also
established airlines who have no opportunity to grow. This
problem must be tackled by increasing airport capacity,
although slot allocation mechanisms will of course always be
needed. The Commission has announced its intention of
producing a report on the slot problem and the Committee
assumes that it will have an opportunity to express its views
on this report. But the Committee would make it clear straight
away that equality of opportunity for all airlines should be
guaranteed.

4. Conclusions

The Committee considers that minimum basic training
4.1.
and on-going in-service training should be introduced and
enforced as a matter of urgency throughout the EU for all air
transport workers in order to guarantee the quality and safety
of services.

4.2.
The Committee considers it essential that air traffic
control systems in Europe be harmonised and Eurocontrol
strengthened. Eurocontrol should, the Committee feels, be
given responsibility for setting standards for national air traffic
control technology and binding procedures. National air traffic
control should be assigned to the private sector. Only in this
way can delays attributable to air traffic control problems be
reduced.

4.3.
The Committee feels that more emphasis should be
placed on safety in air transport, as air transport is forecast to
grow strongly over the next few years.

4.4.
The Commission’s intention of dealing with the
environmental aspects of air transport in a Communication is
also welcomed. The Commission should also look at ways of
improving the link between different modes of transport in
Europe, particularly air and rail transport. Intermodality could
bring many benefits for consumers and the environment.

The Committee feels that passenger rights must be
4.5.
firmly enshrined in law. It must be made possible to take
action against the cause of denied boarding, delays or other
inconveniences to passengers. The regulation providing for
improved compensation of passengers for inconveniences
suffered must finally enter into force.

4.6.
The Committee strongly supports an open skies agree-
ment between the EU and the USA in order to end the
disadvantages suffered by European airlines vis à vis their US
competitors.

3.26.
European airlines too must be able to offer their
customers frequent flyer programmes if they are to withstand
global competition, as these are used by all major airlines and
restricted use would amount to a competitive disadvantage.

The Committee feels that

4.7.
this would further the
Commission’s objectives and also be in the interest of European
consumers, employers and workers with a view to future social
dialogue.

Brussels, 26 January 2000.

The President

of the Economic and Social Committee

Beatrice RANGONI MACHIAVELLI