Proposal for a Council Decision on the conclusion of the Agreement between the European Community and Georgia on certain aspects of air services
Date: 2005-02-25
Institutions: European Commission
Subjects: Georgia, agreement (EU), air transport, common transport policy, fuel tax, ratification of an agreement, right of establishment, trade licence

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 25.2.2005 
COM(2005) 61 final 

2005/0009 (CNS) 

Proposal for a 

COUNCIL DECISION 

on the signature and provisional application of the Agreement between the European 
Community and Georgia on certain aspects of air services 

Proposal for a 

COUNCIL DECISION 

on the conclusion of the Agreement between the European Community and Georgia on 
certain aspects of air services 

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

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

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

Traditional  designation  clauses  in  Member  States’  bilateral  air  services  agreements  infringe 
Community law. They allow a third country to reject, withdraw or suspend the permissions or 
authorisations  of  an  air  carrier  that  has  been  designated  by  a  Member  State  but  that  is  not 
substantially owned and effectively controlled by that Member State or its nationals. This has 
been found to constitute discrimination against Community carriers established in the territory 
of  a  Member  State  but  owned  and  controlled  by  nationals  of  other  Member  States.  This  is 
contrary to Article 43 of the Treaty which guarantees nationals of Member States who have 
exercised their freedom of establishment the same treatment in the host Member State as that 
accorded to nationals of that Member State. 

Following  the  Court  of  Justice  judgements,  the  Council  authorised  the  Commission  in  June 
2003  to  open  negotiations  with  third  countries  on  the  replacement  of  certain  provisions  in 
existing bilateral agreements with a Community agreement.1 

In  accordance  with  the  mechanisms  and  directives  in  the  Annex  to  the  Council’s  decision 
authorising the Commission to open negotiations with third countries on the replacement of 
certain  provisions  in  existing  bilateral  agreements  with  a  Community  agreement,  the 
Commission has negotiated an agreement with Georgia that replaces certain provisions in the 
existing  bilateral  air  services  agreements  between  Member  States  and  Georgia.  Article  2  of 
the  Agreement  replaces  the  traditional  designation  clauses  with  a  Community  designation 
clause, permitting all Community carriers to benefit from the right of establishment. Articles 4 
and  5  of  the  Agreement  resolve  legal  irregularities  stemming  from  the  infringement  of 
Community  competence.  Articles  4  and  5  of  the  Agreement  address  two  types  of  clauses 
concerning matters of Community competence. Article 4 deals with the taxation of aviation 
fuel, a matter which has been harmonised by Council Directive 2003/96/EC restructuring the 
Community framework for the taxation of energy products and electricity, particularly Article 
14 paragraph 2 thereof. Article 5 (Pricing) resolves conflicts between the existing bilateral air 
services agreements and  Council  Regulation No. 2409/92 on fares and rates for air services 
which  prohibits  third  country  carriers  from  being  price  leaders  on  air  services  for  carriage 
wholly within the Community. 

The  Council  is  asked  to  approve  the  decisions  on  the  signature  and  provisional  application 
and  on  the  conclusion  of  the  agreement  between  the  European  Community  and  Georgia  on 
certain aspects of air services and to designate the persons authorized to sign the agreement on 
behalf of the Community.  

1 

Council decision 11323/03 of 5 June 2003 (restricted document) 

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Proposal for a 

COUNCIL DECISION 

on the signature and provisional application of the Agreement between the European 
Community and Georgia on certain aspects of air services 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community, and in particular Article 
80,  paragraph  2,  in  conjunction  with  Article  300,  paragraph  2,  first  sentence  of  the  first 
subparagraph thereof, 

Having regard to the proposal from the Commission2, 

Whereas: 

(1) 

(2) 

The Council has authorised the Commission on 5 June 2003 to open negotiations with 
third  countries  on  the  replacement  of  certain  provisions  in  existing  bilateral 
agreements with a Community agreement; 

The  Commission  has  negotiated  on  behalf  of  the  Community  an  agreement  with 
Georgia  on  certain  aspects  of  air  services  in  accordance  with  the  mechanisms  and 
directives in the Annex to the Council’s decision authorising the Commission to open 
negotiations with third countries on the replacement of certain provisions in existing 
bilateral agreements with a Community agreement; 

(3) 

Subject  to  its  possible  conclusion  at  a  later  date,  the  agreement  negotiated  by  the 
Commission should be signed and provisionally applied. 

HAS DECIDED AS FOLLOWS: 

Sole Article 

1. 

2. 

Subject  to  its  subsequent  conclusion  at  a  later  date,  the  President  of  the  Council  is 
hereby authorised to designate the person or persons empowered to sign on behalf of 
the  Community  the  agreement  between  the  European  Community  and  Georgia  on 
certain aspects of air services. 

Pending  its  entry  into  force,  the  agreement  shall  be  applied  provisionally  from  the 
first day of the first month following the date on which the parties have notified each 
other of the completion of the necessary procedures for this purpose. The President 

2 

OJ C , , p. . 

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of the Council is hereby authorised to make the notification provided in Article 8.2 of 
the agreement. 

3. 

The text of the agreement is annexed to this decision. 

Done at Brussels,  

For the Council 
The President 

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2005/0009 (CNS) 

Proposal for a 

COUNCIL DECISION 

on the conclusion of the Agreement between the European Community and Georgia on 
certain aspects of air services 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community, and in particular Article 
80,  paragraph  2,  in  conjunction  with  Article  300,  paragraph  2,  first  sentence  of  the  first 
subparagraph thereof and Article 300, paragraph 3, first subparagraph, 

Having regard to the proposal from the Commission3, 

Having regard to the opinion of the European Parliament4, 

Whereas: 

(1) 

(2) 

(3) 

The Council has authorised the Commission on 5 June 2003 to open negotiations with 
third  countries  on  the  replacement  of  certain  provisions  in  existing  bilateral 
agreements with a Community agreement; 

The  Commission  has  negotiated  on  behalf  of  the  Community  an  agreement  with 
Georgia  on  certain  aspects  of  air  services  in  accordance  with  the  mechanisms  and 
directives in the Annex to the Council’s decision authorising the Commission to open 
negotiations with third countries on the replacement of certain provisions in existing 
bilateral agreements with a Community agreement; 

This agreement has been signed on behalf of the Community on 22 September 2004 
subject  to  its  possible  conclusion  at  a  later  date,  in  conformity  with  the  decision 
…/…/EC of the Council on 5 

(4) 

This agreement should be approved. 

HAS DECIDED AS FOLLOWS: 

Article 1 

The agreement between the European Community and Georgia on certain aspects of 
air services is approved on behalf of the Community. 

OJ C , , p. . 
OJ C , , p. . 
OJ C , , p. . 

1. 

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4 
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2. 

The text of the agreement is annexed to this decision. 

Article 2 

The  president  of  the  Council  is  authorised  to  designate  the  person  empowered  to  make  the 
notification provided in Article 8.1 of the Agreement. 

Done at Brussels,  

For the Council 
The President 

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ANNEX 

AGREEMENT 

between the European Community 

and the Government of Georgia 

on certain aspects of air services 

THE EUROPEAN COMMUNITY  

of the one part, and  

GOVERNMENT OF GEORGIA 

(hereinafter referred to as ‘Georgia’) 

of the other part 

(hereinafter referred to as ‘the Parties’) 

NOTING that bilateral air service agreements have been concluded between several Member 
States of the European Community and Georgia containing provisions contrary to Community 
law. 

NOTING  that  the  European  Community  has  exclusive  competence  with  respect  to  several 
aspects that may be included in bilateral air service agreements between Member States of the 
European Community and third countries, 

NOTING  that  under  European  Community  law  Community  air  carriers  established  in  a 
Member State have the right to non-discriminatory access to air routes between the Member 
States of the European Community and third countries, 

HAVING  REGARD  to  the  agreements  between  the  European  Community  and  certain  third 
countries  providing  for  the  possibility  for  the  nationals  of  such  third  countries  to  acquire 
ownership in air carriers licensed in accordance with European Community law, 

RECOGNISING  that  certain  provisions  of  the  bilateral  air  service  agreements  between 
Member  States  of  the  European  Community  and  Georgia,  which  are  contrary  to  European 
Community  law,  must  be  brought  into  full  conformity  with  it  in  order  to  establish  a  sound 
legal basis for air services between the European Community and Georgia and to preserve the 
continuity of such air services, 

NOTING that provisions of the bilateral air service agreements between Member States of the 
European Community and Georgia, which are not contrary to European Community law, do 
not need to be amended or replaced, 

NOTING that it is not a purpose of the European Community, as part of these negotiations, to 
increase  the  total  volume  of  air  traffic  between  the  European  Community  and  Georgia,  to 
affect the balance between Community air carriers and air carriers of Georgia, or to negotiate 

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amendments  to  the  provisions  of  existing  bilateral  air  service  agreements  concerning  traffic 
rights. 

HAVE AGREED AS FOLLOWS:  

ARTICLE 1 

General Provisions 

1. 

2. 

3. 

4. 

1. 

For the purposes of this Agreement, ‘Member States’ shall mean Member States of 
the European Community.  

References in each of the agreements listed in Annex 1 to nationals of the Member 
State that is a party to that agreement shall be understood as referring to nationals of 
the Member States of the European Community. 

References in each of the agreements listed in Annex 1 to air carriers or airlines of 
the Member State that is a party to that agreement shall be understood as referring to 
air carriers or airlines designated by that Member State. 

The  granting  of  traffic  rights  continues  to  be  carried  out  through  bilateral 
arrangements. 

ARTICLE 2 

Designation by a Member State 

The  provisions  in  paragraphs  2  and  3  of  this  Article  shall  supersede  the 
corresponding provisions in the articles listed in Annex 2 (a) and (b) respectively, in 
relation  to  the  designation  of  an  air  carrier  by  the  Member  State  concerned,  its 
authorisations  and  permissions  granted  by  Georgia,  and  the  refusal,  revocation, 
suspension  or  limitation  of  the  authorisations  or  permissions  of  the  air  carrier, 
respectively. 

2. 

On receipt of a designation by a Member State, Georgia shall grant the appropriate 
authorisations and permissions with minimum procedural delay, provided that: 

i. 

ii. 

iii. 

the  air  carrier  is  established  in  the  territory  of  the  designating  Member  State 
under  the  Treaty  establishing  the  European  Community  and  has  a  valid 
Operating Licence in accordance with European Community law;  

effective regulatory control of the air carrier is exercised and maintained by the 
Member  State  responsible  for  issuing  its  Air  Operators  Certificate  and  the 
relevant aeronautical authority is clearly identified in the designation; and 

the  air  carrier  is  owned  and  shall  continue  to  be  owned  directly  or  through 
majority  ownership  by  Member  States  and/or  nationals  of  Member  States,  or 
by other states listed in Annex 3 and/or nationals of such other states, and shall 
at all times be effectively controlled by such states and/or such nationals. 

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3. 

Georgia may refuse, revoke, suspend or limit the authorisations or permissions of an 
air carrier designated by a Member State where: 

i. 

ii. 

the air carrier is not established in the territory of the designating Member State 
under  the  Treaty  establishing  the  European  Community  or  does  not  have  a 
valid Operating Licence in accordance with European Community law; 

effective regulatory control of the air carrier is not exercised or not maintained 
by  the  Member  State  responsible  for  issuing  its  Air  Operators  Certificate,  or 
the  relevant  aeronautical  authority  is  not  clearly  identified  in  the  designation; 
or 

iii. 

the  air  carrier  is  not  owned  and  effectively  controlled  directly  or  through 
majority  ownership  by  Member  States  and/or  nationals  of  Member  States,  or 
by other states listed in Annex 3 and/or nationals of such other states. 

In  exercising  its  right  under  this  paragraph,  Georgia  shall  not  discriminate  between 
Community air carriers on the grounds of nationality. 

1. 

2. 

1. 

2. 

ARTICLE 3 

Rights with regard to regulatory control 

The provisions in paragraph 2 of this Article shall complement the articles listed in 
Annex 2 (c).  

Where  a  Member  State  has  designated  an  air  carrier  whose  regulatory  control  is 
exercised and maintained by another Member State, the rights of Georgia under the 
safety provisions of the agreement between the Member State that has designated the 
air  carrier  and  Georgia  shall  apply  equally  in  respect  of  the  adoption,  exercise  or 
maintenance  of  safety  standards  by  that  other  Member  State  and  in  respect  of  the 
operating authorisation of that air carrier. 

ARTICLE 4 

Taxation of aviation fuel 

The  provisions  in  paragraph  2  of  this  Article  shall  complement  the  corresponding 
provisions in the articles listed in Annex 2 (d).  

Notwithstanding  any  other  provision  to  the  contrary,  nothing  in  each  of  the 
agreements listed in Annex 2 (d) shall prevent a Member State from imposing taxes, 
levies, duties, fees or charges on fuel supplied in its territory for use in an aircraft of 
a  designated  air  carrier  of  Georgia  that  operates  between  a  point  in  the  territory  of 
that Member State and another point in the territory of that Member State or in the 
territory of another Member State. 

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ARTICLE 5 

Tariffs for carriage within the European Community 

1. 

2. 

The provisions in paragraph 2 of this Article shall complement the articles listed in 
Annex 2 (e). 

The  tariffs  to  be  charged  by  the  air  carrier(s)  designated  by  Georgia  under  an 
agreement listed in Annex 1 containing a provision listed in Annex 2 (e) for carriage 
wholly  within  the  European  Community  shall  be  subject  to  European  Community 
law. 

ARTICLE 6 

Annexes to the Agreement 

The Annexes to this Agreement shall form an integral part thereof. 

ARTICLE 7 

Revision or amendment  

The Parties may, at any time, revise or amend this Agreement by mutual consent. 

ARTICLE 8 

Entry into force and provisional application 

1. 

2. 

3. 

This  Agreement  shall  enter  in  force  when  the  Parties  have  notified  each  other  in 
writing  that  their  respective  internal  procedures  necessary  for  its  entry  into  force 
have been completed. 

Notwithstanding paragraph 1, the Parties agree to provisionally apply this Agreement 
from the first day of the month following the date on which the Parties have notified 
each other of the completion of the procedures necessary for this purpose. 

Agreements and other arrangements between Member States and Georgia which, at 
the date of signature of this Agreement, have not yet entered into force and are not 
being applied provisionally are listed in Annex 1 (b). This Agreement shall apply to 
all  such  Agreements  and  arrangements  upon  their  entry  into  force  or  provisional 
application. 

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ARTICLE 9 

Termination 

1. 

2. 

In the event that an agreement listed in Annex 1 is terminated, all provisions of this 
Agreement that relate to the agreement listed in Annex 1 concerned shall terminate at 
the same time.  

In  the  event  that  all  agreements  listed  in  Annex  1  are  terminated,  this  Agreement 
shall terminate at the same time.  

IN  WITNESS  WHEREOF,  the  undersigned,  being  duly  authorised,  have  signed  this 
Agreement. 

Done at [….] in duplicate, on this […] day of […, …] in the Czech, Danish, Dutch, English, 
Estonian, Finnish, French, German, Greek, Hungarian, Italian, Latvian, Lithuanian, Maltese, 
Polish,  Portuguese,  Slovak,  Slovene,  Spanish,  Swedish  and  Georgian  languages.  In  case  of 
divergence the English text shall prevail over the other language texts. 

FOR THE EUROPEAN COMMUNITY: 

FOR THE GOVERNMENT OF GEORGIA: 

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ANNEX 1  

List of agreements referred to in Article 1 of this Agreement 

(a) Air service agreements  between  the Government of Georgia and Member States of 
the European Community which, at the date of signature of this Agreement, have been 
concluded, signed and/or are being applied provisionally 

- Agreement between the Austrian Federal Government and the Government of Georgia 
relating  to  Air  Services  signed  at  Vienna  on  15  December  1997  (date  of  entry  into  force: 
01.10.2002), hereinafter referred to as the “Georgia – Austria Agreement” in Annex 2 ; 

- Agreement between the Government of the Republic of Cyprus and the Government of 
Georgia relating to Air Services signed at Tbilisi on 30th June 1997 (date of entry into force: 
05.11.1998), hereinafter referred to as the “Georgia – Cyprus Agreement” in Annex 2 ; 

-  Agreement  between  the  Federal  Republic  of  Germany  and  the  Republic  of  Georgia 
relating  to  Air  Transport  signed  at  Bonn  on  25  June  1993  (date  of  entry  into  force: 
27.11.1994), hereinafter referred to as the “Georgia – Germany Agreement” in Annex 2 ; 

-  Agreement  between  the  Government  of  the  Hellenic  Republic  and  the  Government  of 
the Republic of Georgia on Air Transport signed at Tbilisi on 10 April 1997 (date of entry 
into  force:  27.05.1998),  hereinafter  referred  to  as  the  “Georgia  –  Greece  Agreement”  in 
Annex 2 ; 

- Agreement between the Government of Ireland and the Government of the Republic of 
Georgia  on  Air  Transport  signed  at  Dublin  on  2  March  1995  (date  of  entry  into  force: 
02.03.1995), hereinafter referred to as the “Georgia – Ireland Agreement” in Annex 2 ; 

- Agreement between the Government of the Republic of Lithuania and the Government 
of the Republic of Georgia relating to Air Services signed at Tbilisi on 12 April 1996 (date 
of  entry  into  force:  12.01.1999),  hereinafter  referred  to  as  the  “Georgia  –  Lithuania 
Agreement” in Annex 2 ; 

-  Agreement  between  the  Kingdom  of  the  Netherlands  and  the  Republic  of  Georgia  for 
Air Services between and beyond their respective territories signed at Wassenaar on 3 April 
1995  (date  of  entry  into  force:  01.05.1997),  hereinafter  referred  to  as  the  “Georgia  – 
Netherlands Agreement” in Annex 2 ; 

-  Agreement  between  the  Government  of  the  United  Kingdom  of  Great  Britain  and 
Northern Ireland and Government of the Executive Authority (Government) of Georgia 
relating  to  Air  Services  signed  at  Tbilisi  on  17  September  2003,  hereinafter  referred  to  as 
“Georgia –United Kingdom Agreement” in Annex 2 ; 

Supplemented by Memorandum of Understanding done at Tbilisi on 17 September 2003, and 
by the Agreed Record signed in Tbilisi on 2 November 2004. 

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(b)  Air  service  agreements  and  other  arrangements  initialled  or  signed  between  the 
Government  of  the  Republic  of  Georgia  and  Member  States  of  the  European 
Community which, at the date of signature of this Agreement, have not yet entered into 
force and are not being applied provisionally 

- Agreement between the Government of Belgium and the Government of the Republic of 
Georgia  on  Air  Transport  initialled  on  24  February  1995,  hereinafter  referred  to  as  the 
“Georgia –Belgium Agreement” in Annex 2 ; 

- Agreement between the Government of the Republic of Hungary and the Government 
the Republic of Georgia on Air Transport initialled on 29 June 1995, hereinafter referred to 
as the “Georgia –Hungary Agreement” in Annex 2 ; 

-Agreement  between the Government of the Republic of Latvia and the Government of 
Georgia concerning Civil Air Transport initialled on 6 December 1996, hereinafter referred to 
as the “Georgia –Latvia Agreement” in Annex 2; 

- Agreement between the Government of the Republic of Poland and the Government of 
the  Republic  of  Georgia  concerning  Civil  Air  Transport  initialled  at  Warsaw  on  26  April 
1993, hereinafter referred to as the “Georgia – Poland Agreement” in Annex 2 ; 

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List of articles in the agreements listed in Annex 1 and referred to in Articles 2 to 5 of 
this Agreement 

(a) 

Designation by a Member State: 

Annex 2 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

Article 3 of the Georgia –Austria Agreement; 

Articles 3 and 4 of the Georgia-Belgium Agreement; 

Article 4 of the Georgia –Cyprus Agreement; 

Article 3 of the Georgia –Germany Agreement; 

Article 3 of the Georgia –Greece Agreement; 

Article 3 of the Georgia-Hungary Agreement; 

Article 3 of the Georgia-Ireland Agreement 

Article 3 of the Georgia-Latvia Agreement 

Article 3 of the Georgia – Lithuania Agreement; 

Article 4 of the Georgia – Netherlands Agreement; 

Article 3 of the Georgia – Poland Agreement 

Article 4 of the Georgia –UK Agreement. 

(b) 

Refusal,  Revocation,  Suspension  or  Limitation  of  Authorisations  or 
Permissions: 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

Article 4 of the Georgia –Austria Agreement; 

Article 5 of the Georgia-Belgium Agreement; 

Article 5 of the Georgia –Cyprus Agreement; 

Article 4 of the Georgia –Germany Agreement; 

Article 4 of the Georgia –Greece Agreement; 

Article 4 of the Georgia-Hungary Agreement; 

Article 3, paragraphs 5 and 6, of the Georgia-Ireland Agreement; 

Article 4 of the Georgia-Latvia Agreement; 

Article 4 of the Georgia – Lithuania Agreement; 

Article 5 of the Georgia – Netherlands Agreement; 

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– 

– 

(c) 

– 

Article 4 of the Georgia-Poland Agreement 

Article 5 of the Georgia –UK Agreement. 

Regulatory control: 

Article 7 of the Georgia-Belgium Agreement. 

(d) 

Taxation of Aviation Fuel: 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

Article 7 of the Georgia –Austria Agreement; 

Article 10 of the Georgia-Belgium Agreement; 

Article 7 of the Georgia –Cyprus Agreement; 

Article 6 of the Georgia –Germany Agreement; 

Article 9 of the Georgia –Greece Agreement; 

Article 9 of the Georgia-Hungary Agreement; 

Article 11 of the Georgia-Ireland Agreement; 

Article 6 of the Georgia-Latvia Agreement; 

Article 11 of the Georgia – Lithuania Agreement; 

Article 10 of the Georgia – Netherlands Agreement; 

Article 6 of the Georgia-Poland Agreement; 

Article 8 of the Georgia –UK Agreement. 

(e) 

Tariffs for Carriage within the European Community: 

– 

– 

– 

– 

– 

– 

– 

– 

– 

Article 11 of the Georgia –Austria Agreement; 

Article 13 of the Georgia-Belgium Agreement; 

Article 17 of the Georgia –Cyprus Agreement; 

Article 10 of the Georgia –Germany Agreement; 

Article 12 of the Georgia –Greece Agreement; 

Article 8 of the Georgia-Hungary Agreement; 

Article 6 of the Georgia-Ireland Agreement; 

Article 11 of the Georgia-Latvia Agreement; 

Article 9 of the Georgia – Lithuania Agreement; 

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– 

– 

– 

Article 6 of the Georgia – Netherlands Agreement; 

Article 10 of the Georgia-Poland Agreement 

Article 7 of the Georgia –UK Agreement. 

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ANNEX 3 

List of other states referred to in Article 2 of this Agreement 

(a) 

(b) 

(c) 

(d) 

The Republic of Iceland (under the Agreement on the European Economic Area); 

The Principality of Liechtenstein (under the Agreement on the European Economic 
Area); 

The Kingdom of Norway (under the Agreement on the European Economic Area); 

The Swiss Confederation (under the Agreement between the European Community 
and the Swiss Confederation on Air Transport) 

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