Common Position (EC) No 7/2004 of 5 December 2003 adopted by the Council, acting in accordance with the procedure referred to in Article 251 of the Treaty establishing the European Community, with a view to adopting a regulation of the European Parliament and of the Council on the negotiation and implementation of air service agreements between Member States and third countries
Date: 2003-12-05
Institutions: Council of the European Union
Subjects: EU Member State, air transport, bilateral agreement, provision of services, third country

2.3.2004

EN

Official Journal of the European Union

C 54 E/33

COMMON POSITION (EC) No 7/2004

adopted by the Council on 5 December 2003

with a view to adopting Regulation (EC) No . . ./2004 of the European Parliament and of the
. . . on the negotiation and implementation of air service agreements between
Council of

Member States and third countries

(2004/C 54 E/03)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE
EUROPEAN UNION,

Having regard to the Treaty establishing the European
Community, and in particular Article 80(2) thereof,

Having regard to the proposal from the Commission,

Having regard to the Opinion of the European Economic and
Social Committee (1),

Acting in accordance with the procedure laid down in Article
251 of the Treaty (2),

Whereas:

(1)

(2)

International aviation relations between Member States
and third countries have been traditionally governed by
bilateral air service agreements between Member States
related
and third countries,
bilateral or multilateral arrangements.

their Annexes and other

Following the judgments of the Court of Justice of the
European Communities in cases C-466/98, C-467/98,
C-468/98, C-469/98, C-471/98, C-472/98, C-475/98 and
C-476/98, the Community has exclusive competence with
respect to various aspects of such agreements.

(3) The Court has also clarified the right of Community air
carriers to benefit from the right of establishment within
the Community, including the right to non-discriminatory
market access.

that

is apparent
falls partly within the competence of

the subject-matter of an
(4) Where it
agreement
the
Community and partly within that of its Member States,
it is essential to ensure close cooperation between the
Member States and the Community institutions, both in
the process of negotiation and conclusion and in the
fulfilment of the commitments entered into. That obli-
gation to cooperate flows from the requirement of unity
in the international representation of the Community. The
Community institutions and the Member States should
take all necessary steps to ensure the best possible coop-
eration in that regard.

(5) The cooperation procedure between Member States and
the Commission established by this Regulation should be
without prejudice to the division of competencies between
the Community and Member States, in accordance with
Community law as interpreted by the Court of Justice.

(6) All existing bilateral agreements between Member States
and third countries that contain provisions contrary to
Community law should be amended or replaced by new
agreements that are wholly compatible with Community
law.

(7) Without prejudice to the Treaty, and in particular Article
300 thereof, Member
States may wish to make
amendments to existing agreements and make provision
to manage their implementation until such time as an
agreement concluded by the Community enters into force.

(8)

(9)

It is essential to ensure that a Member State conducting
negotiations takes account of Community law, broader
Community
Community
and
negotiations.

ongoing

interests

If a Member State wishes to involve air carriers in the
process of negotiation, all air carriers with an estab-
lishment in the territory of the Member State concerned
should be treated equally.

(10) Establishment on the territory of a Member State implies
the effective and real exercise of air transport activity
through stable arrangements; the legal form of such an
establishment, whether a branch or a subsidiary with a
legal personality, should not be the determining factor in
this respect. When an undertaking is established on the
territory of several Member States, as defined by the
Treaty,
in order to avoid any circum-
vention of national law, that each of the establishments
in accordance with
fulfils the obligations which may,
law
Community law, be
applicable to its activities.

imposed by the national

it should ensure,

(1) OJ C 234, 30.9.2003, p. 21.
(2) Opinion of the European Parliament of 2 September 2003 (not yet
published in the Official Journal), Council Common Position of 5
December 2003 and Position of the European Parliament of . . .
(not yet published in the Official Journal).

(11) In order to ensure that

the rights of Community air
carriers are not unduly restricted, no new arrangements
that reduce the number of Community air carriers which
may be designated to provide air services in a given
market
service
should be introduced in bilateral air
agreements.

C 54 E/34

EN

Official Journal of the European Union

2.3.2004

(12) Member States should establish non-discriminatory and
transparent procedures
traffic
for
rights between Community air carriers. In applying those
procedures Member States should have due regard to the
need to preserve continuity of air services.

the distribution of

(13) The measures necessary for the implementation of this
adopted in accordance with
Regulation should be
Council Decision 1999/468/EC of 28 June 1999 laying
down the procedures for the exercise of implementing
powers conferred on the Commission (1).

(14) Any Member State may invoke the confidentiality of the
provisions of bilateral agreements it has negotiated and
request
to share the information
with other Member States.

the Commission not

(15) Arrangements for greater cooperation over the use of
Gibraltar airport were agreed in London on 2 December
1987 by the Kingdom of Spain and the United Kingdom
in a joint declaration by the Ministers of Foreign Affairs of
the two countries. Such arrangements have yet to enter
into operation.

compliance with Community law,

(16) Since the objectives of this Regulation, namely the coor-
dination of negotiations with third countries with a view
to concluding air service agreements,
the necessity to
guarantee a harmonised approach in the implementation
and application of those agreements and the verification of
their
cannot be
sufficiently achieved by the Member States and can
therefore, by reason of
the Community-wide scope of
this Regulation, be better achieved at Community level,
the Community may adopt measures in accordance with
the principle of subsidiarity, as set out in Article 5 of the
Treaty. In accordance with the principle of proportionality,
as set out in that Article, this Regulation does not go
beyond what
to achieve those
objectives,

is necessary in order

— any relevant standard clauses, developed jointly between
Member States and the Commission, are included in such
negotiations; and

— the notification procedure set out in paragraphs 2, 3 and 4

is complied with.

Where appropriate,
participate as an observer in any such negotiations.

the Commission shall be invited to

to enter

include a copy of

2. Where a Member State intends
into such
negotiations it shall notify the Commission of its intentions
in writing. This notification shall
the
existing agreement, if available, other relevant documentation
and an indication of the provisions to be addressed in the
negotiations, the objectives of the negotiations and any other
relevant information. The Commission shall make the notifi-
cation and, on request,
the accompanying documentation,
available to other Member States, subject to the requirements
of confidentiality.

before

least one calendar
The information shall be transmitted at
month
to
scheduled
formal
commence with the third country concerned. If, due to excep-
tional circumstances, formal negotiations are scheduled at less
than one month's notice, the Member State shall transmit the
information as soon as possible.

negotiations

are

3. Member States may make comments to the Member State
which has notified its intention to enter negotiations in
accordance with paragraph 2. That Member State shall take
such comments into account as far as possible in the course
of the negotiations.

4.
If, within 15 working days of receipt of the notification
referred to in paragraph 2, the Commission concludes that the
negotiations are likely to:

— undermine

the objectives of Community negotiations

underway with the third country concerned, and/or

HAVE ADOPTED THIS REGULATION:

— lead to an agreement which is

incompatible with

Community law

Article 1

Notification to the Commission

it shall inform the Member State accordingly.

1.
A Member State may, without prejudice to the respective
competencies of the Community and its Member States, enter
into negotiations with a third country concerning a new air
service agreement or the modification of an existing air service
agreement, its Annexes or any other related bilateral or multi-
lateral arrangement, the subject matter of which falls partly
within the competence of the Community, provided that:

(1) OJ L 184, 17.7.1999, p. 23.

Article 2

Consultation

of

stakeholders

and

participation

in

negotiations

Insofar as air carriers and other interested parties are to be
involved in the negotiations referred to in Article 1, Member
States shall treat equally all Community air carriers with an
establishment on their
to which the
Treaty applies.

respective territories

2.3.2004

EN

Official Journal of the European Union

C 54 E/35

Article 3

Article 6

Prohibition on introducing more restrictive arrangements

Publication of procedures

A Member State shall not enter into any new arrangement with
a third country, which reduces the number of Community air
carriers which may, in accordance with existing arrangements,
be designated to provide services between its territory and that
country, neither in respect of the entire air transport market
between the two parties nor on the basis of specific city pairs.

Article 4

Conclusion of agreements

Upon signature of an agreement,

1.
concerned shall notify the Commission of
the negotiations together with any relevant documentation.

the Member State
the outcome of

2. Where the negotiations have resulted in an agreement
which incorporates the relevant standard clauses referred to
in Article 1(1),
the Member State shall be authorised to
conclude the agreement.

3. Where the negotiations have resulted in an agreement
which does not
incorporate the relevant standard clauses
referred to in Article 1(1), the Member State shall be auth-
orised,
in accordance with the procedure referred to in
Article 7(2), to conclude the agreement, provided that this
does not harm the object and purpose of the Community
common transport policy. The Member State may provisionally
apply the agreement pending the outcome of this procedure.

Member States shall inform the Commission without delay of
the procedures that they shall apply for the purposes of Article
5 and, where appropriate, Article 2. For information purposes,
the Commission shall ensure
these procedures are
published in the Official Journal of the European Union within
receipt. Any new procedures and
eight weeks of
subsequent
be
procedures
to
communicated to the Commission at least eight weeks before
they enter into force, so that the Commission can ensure their
publication in the Official Journal of the European Union within
that eight-week period.

changes

existing

their

shall

that

Article 7

Committee procedure

1.
The Commission shall be assisted by the committee
established under Article 11 of Council Regulation (EEC) No
2408/92 of 23 July 1992 on access for Community air carriers
to intra-Community air routes (2).

2. Where reference is made to this paragraph, Articles 3 and
7 of Decision 1999/468/EC shall apply, having regard to the
provisions of Article 8 thereof.

3.

The Committee shall adopt its rules of procedure.

Article 8

Confidentiality

4.
Notwithstanding paragraphs 2 and 3, if the Commission
is actively negotiating with the same third country on the basis
of a country-specific mandate or on the basis of Council
Decision 2004/. . ./EC of . . . authorising the Commission to
open negotiations with third countries on the replacement of
certain provisions in existing bilateral agreements with a
Community agreement 1 (1),
the Member State concerned
may be authorised, in accordance with the procedure referred
to in Article 7(2), to apply provisionally and/or conclude the
agreement.

In notifying the Commission of negotiations and their outcome
as envisaged in Articles 1 and 4, Member States shall clearly
inform the Commission if any information therein is to be
considered confidential and whether it can be shared with
other Member States. The Commission and Member States
shall ensure that any information identified as confidential is
treated according to Article 4(1)(a) of Regulation (EC) No
1049/2001 of the European Parliament and of the Council
of 30 May 2001 regarding public access
to European
Parliament, Council and Commission documents (3).

Article 5

Distribution of traffic rights

Article 9

Gibraltar

State

concludes

a Member

an agreement,

or
Where
amendments to an agreement or its Annexes, that provide
for limitations on the use of traffic rights or the number of
Community air carriers eligible to be designated to take
advantage of traffic rights, that Member State shall ensure a
traffic rights among eligible Community air
distribution of
carriers on the basis of a non-discriminatory and transparent
procedure.

(1) OJ L . . .

The application of

this Regulation to the airport of
1.
Gibraltar
is understood to be without prejudice to the
respective legal positions of the Kingdom of Spain and the
United Kingdom with regard to the dispute over sovereignty
over the territory in which the airport is situated.

(2) OJ L 240, 24.8.1992, p. 8. Regulation as last amended by Regu-
lation (EC) No 1882/2003 of the European Parliament and of the
Council (OJ L 284, 31.10.2003, p. 1).

(3) OJ L 145, 31.5.2001, p. 43.

C 54 E/36

EN

Official Journal of the European Union

2.3.2004

Application of this Regulation to Gibraltar airport shall
2.
be suspended until
the arrangements included in the Joint
Declaration made by the Foreign Ministers of the Kingdom
of Spain and the United Kingdom on 2 December 1987
enter into operation. The Governments of Spain and the
United Kingdom will
inform the Council of such date of
entry into operation.

Article 10

Entry into force

This Regulation shall enter into force on the thirtieth day
following its publication in the Official Journal of the European
Union.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at . . .

For the European Parliament

The President

For the Council

The President

2.3.2004

EN

Official Journal of the European Union

C 54 E/37

STATEMENT OF THE COUNCIL'S REASONS

I.

INTRODUCTION

1. On 26 February 2003 the Commission submitted a proposal for a Regulation on the negotiation

and implementation of air service agreements between Member States and third countries.

2. The European Parliament adopted opinion at

the
Economic and Social Committee's opinion was adopted on 16 July 2003. The Committee of the
Regions informed the Council that it did not intend to deliver an opinion on this file.

first reading on 2 September 2003, whilst

3. On 5 December 2003 the Council adopted its common position in accordance with Article 251 of

the Treaty.

II. OBJECTIVE

The proposal was made in the wake of the European Court of Justice rulings of 5 November 2002
regarding bilateral air service agreements concluded by eight Member States with the United States.
These judgements confirmed that the agreements in question included provisions falling within the
exclusive competence of the Community. But the consequences of these judgements went much wider.
In effect the Court confirmed that Member States are not exclusively competent to negotiate and
conclude a classical bilateral air services agreement.

The proposal in question responds to this situation by seeking to establish a framework within which
Member States can continue to negotiate and implement such agreements whilst respecting Community
law in this area of ‘mixed competence’.

III. ANALYSIS OF THE COMMON POSITION

1. Key changes

Whilst accepting the basic rationale behind the Commission's proposal, the Council made a number
of important changes to the content and structure of the text, and in particular to Articles 1 and 4
which deal with the Community notification and authorisation system. These changes reflect the
over-riding concern of Member States that the system to be established by this Regulation should be
workable in practice and permit Member States to continue to negotiate new agreements and update
agreements already in force in a manner that is both efficient and responsive to the ever-shifting
demands of the global market for aviation services.

Three changes should be particularly stressed in this regard:

— the scope of the draft Regulation was broadened so as to also include cases where Member States
negotiate with a third country with which the Commission is also negotiating on behalf of the
Community. Through this extension of scope, the Council was able to secure acceptance of the
notion of parallel negotiations at Community and national level. This, inter alia, permits routine
updating of existing bilateral agreements pending the outcome of Community level negotiations;

— a fast

track procedure, whereby Member States are authorised automatically to conclude
agreements on behalf of the Community if they include certain standard clauses, has been
introduced;

— the principle that Member States may provisionally apply agreements pending the outcome of

Community verification procedures has been introduced.

C 54 E/38

EN

Official Journal of the European Union

2.3.2004

The result of these changes is a comprehensive framework to covering all possible scenarios. Under
the new Article 4, the Commission retains powers to block agreements where negotiations have not
resulted in the inclusion of standard Community clauses (and the agreements might consequently
infringe Community law), or in cases where the Commission is itself actively negotiating with the
third country concerned on the basis of a mandate granted by the Council. In both situations the
Commission decides together with an advisory committee of Member States. The Council considers
the whole system established to be a balanced and reasonable one, which takes account of not only
the Commission's institutional role as the guardian of the Treaty but also the critical importance of
speedy and lightweight procedures, to be applied only in those categories of cases where it is strictly
necessary.

2. Other significant modifications

Several other less fundamental, but nevertheless significant, changes to the Commission's proposal
have been introduced. These include the following:

— the obligation on Member States in Article 1 to notify each other regarding forthcoming
negotiations has been removed. Now the Commission is the central repository of such notifi-
cations which it must make available to other Member States. This is a less bureaucratic and
more streamlined system;

— the text of Article 2 has been broadened to require equal treatment of all interested parties (not

only air carriers) as regards their association with negotiations taking place;

— the intention behind Article 3, the prohibition of more restrictive arrangements, has been

clarified;

— a timescale for publication of procedures has been added in Article 6. (Previously there was a

deadline only for publication of changes, but not of the procedures themselves);

— regarding confidentiality (Article 8,

intention underlying the
Commission's proposal — that confidentiality restrictions could prevent notifications being
passed on to other Member States — has been retained but clarified further;

formerly Article 7),

the

— the relevant standard provisions regarding the airport of Gibraltar have been introduced.

3. Consideration of the European Parliament's first reading opinion

The underlying concerns expressed by the European Parliament in its first reading opinion coincided
quite closely with those of Member States. It is therefore fair to say that the Parliament's opinion is
well reflected, in general terms, in the common position text. However, because of the significant
structural changes introduced by the Council, particularly to Articles 1 and 4, it has not always been
possible to follow the specific wording of the individual amendments.

(a) Amendments incorporated fully or in part into the common position

Amendments 1, 2 and 3

Accepted in full.

Amendment 11

Accepted in part and in principle. The limitation to ‘official’ negotiations proposed by the
Parliament is reflected through the introduction in Article 4(4) of the requirement that the
Commission must be ‘actively’ negotiating.

2.3.2004

EN

Official Journal of the European Union

C 54 E/39

Amendment 12

Accepted in principle. The moving of the text in the first part of the amendment to paragraph 2
is a drafting change followed in principle by the Council. The Council has also followed the
Parliament in removing the active requirement for a Member State to inform other Member
States. The addition of greater flexibility (adding ‘in principle’) regarding the timing of notifi-
cation is taken over in the Council text by a derogation from the one month limit ‘due to
exceptional circumstances’.

Amendment 19

Acceptable in that the equivalent text is already to be found in Article 4(1).

Amendment 14

The first part is accepted in principle.

Amendment 15

Accepted in principle. Following the Parliament the Council has sought a clearer formulation of
Article 3.

(b) Amendments not incorporated into the common position

Amendments 4 and 14 (second part) deal with the notion of establishment originating in the
Treaty and interpreted in many rulings of the Court of Justice. There is very little margin to
depart from this concept in secondary legislation.

Amendment 5 does not correspond to the substantive article.

Amendment 6 seeks to alter established standard recital wording on subsidiarity and propor-
tionality.

Amendment 7 does not fit well with the text of the articles and seems inconsistent with the fact
that bilateral agreements are an area of ‘mixed competence’.

Amendments 8, 9 and 10 do not concern Member State-level negotiations and thus are not
appropriate as recitals to this regulation. Such policy concerns are more typically included in
negotiating mandates granted to the Commission which are necessarily non-public documents.

Amendment 13 is not accepted because the Council considers it important that a Member State
has the possibility of commenting on another Member State's negotiations.

Regarding Amendment 18 the Council considers that the common position's provisions on
confidentiality are clearer and more workable in practice.

4. Conclusions

The Council considers that the common position represents a fair and reasonable balance combining
the need for pragmatic and workable and mechanisms, consistent with the functioning of the global
aviation market, with the legal requirements flowing from the Treaty as interpreted by the Court of
Justice. In reaching this common position, the Council has sought to take the utmost account of the
concerns expressed by the European Parliament in first reading.