WASA - Explanatory Notes
Identification and Applicability
Operational and Commercial Clauses
Significant
Elements Concerning Capacity
Conditions Applicable to Routes
The
WASA online tool replaces the original “Database of the World’s Air Services
Agreement” published as ICAO Doc. 9511. The WASA contains texts of bilateral
air services agreements and amendments in PDF format. It also includes codified
“Summaries of Provisions” of bilateral air services agreements and amendments
which are filed with ICAO by its member States as well as non-registered
agreements obtained from other sources such as official national websites.
The
database has an integrated query function enabling States and other users to
identify all the agreements, and their related amendments, which are available
in the database, involving one or more countries.
Users
can view and print individual agreements and their summaries of provisions,
including route exchanges. Additionally users can further narrow down their
selection of agreements by applying filters related to one or more of the
provisions identified in the summaries. The toll also allows carrying out
comparative analyses.
The
summaries of provisions presented in this database have no official status as
interpretations of the intentions of the parties to the air services agreements
or of the contents of those agreements. They merely identify the existence or
absence of particular elements or provisions in each agreement. The summaries
are therefore not a substitute for the actual wording of the agreement.
When
using this database the following should be noted:
a)
the
agreements and arrangements concluded by certain States which are no longer in existence
are continued to be listed under the names of these former States, i.e. USSR,
Czechoslovakia and Yugoslavia;
b)
some
agreements apply to a territory that comes under the jurisdiction of a country
or certain amendments to agreements have provisions that apply only to specific
points of the route exchange. For example, agreement No. 3630 is an amendment
to the agreement between Netherlands and Venezuela and relates to air
transportation between Aruba and Venezuela.
The
following explanatory notes provide a description of the various elements found
in each bilateral air services agreement included in this database. The
definitions should be read in conjunction with the definitions provided in
ICAO’s “Policy and Guidance Material on the Economic Regulation of Air
Transport” (Doc 9587).
The
names of countries shown are contracting parties to the summarized bilateral
agreement and are the primary means of identification of each agreement.
The
registration number allocated by ICAO to an agreement in DAGMAR (“Database of
Aeronautical Agreements and Arrangements”) when filed and registered with the ICAO
in accordance with Article 83 of the Chicago Convention. An agreement with a
number of 10,000 and above is not registered with ICAO and has received a
number specified exclusively for the WASA database.
Date
of the signature of the agreement. For an agreement effected by an exchange of
diplomatic notes (with a different date) the note with the latest date is the
one which completes the agreement and its date is the agreement date. Coding: DD/MM/YYYY
Date
the agreement entered into force as notified to ICAO. In the absence of such
notification, the date from which the agreement itself indicates it began to
apply, either provisionally (pending ratification or a similar process) or
definitively, is considered the effective date. Coding: DD/MM/YYYY
Status
of its official registration with ICAO according to Article 83 of the Chicago
Convention
Obsolete
Status of the agreement if it has been superseded or become otherwise obsolete.
The agreement is still kept in the database for historic analysis and archiving
purposes.
ICAO Amendment Number
Registration
number of an amendment to the original agreement.
Usually
the date the amendment entered into force as notified to ICAO. If, however,
there are two parts to the amendment with different effective dates, or there
are multiple amendments with different dates but a single ICAO registration
number, then the date entered is the earliest date involved. Coding: DD/MM/YYYY
Determined by the type and number of parties that
signed the agreement.
It can be bilateral (two signing parties),
multilateral (more than two signing parties) or regional (depending on the
situation, normally more than two signing parties and/or a group of States as a
party).
Agreements
are classified as “scheduled”, “non-scheduled” or “both, scheduled and
non-scheduled”.
An
agreement on scheduled air services typically covers services open to use by
the general public and operated according to a published timetable or with such
a regular frequency that it constitutes an easily recognizable series of
flights. Any other services fall into the category ‘non-scheduled’.
Agreements
covering both scheduled and non-scheduled services will usually be clearly
indicated, a brief reference to non-scheduled services in a scheduled service
agreement is sufficient to indicate this wider scope of agreement.
Notification by one party to the
other of which and how many airline(s) will exercise that party’s rights to
operate the agreed services. An agreement may specify single designation (each
party may designate one airline) or multiple designations (each party may
designate one or more airlines). In the latter case, a party may also designate
more than one airline but with restrictions on specific routes.
Traditional:
Agreement covers all three elements referring to single designation (may
include multiple designation), predetermination of capacity and dual approval
of tariffs, it is categorized as Traditional.
Full liberalization
(includes
“open skies”): Agreement contains at least the following liberal elements: unrestricted
traffic rights (minimum 3rd , 4th and 5th
Freedoms of the Air); multiple designation with no route limitations; free
determination of capacity; dual disapproval, country of origin or free pricing
tariff regime.
Transitional:
Agreement contains at least one or more of the above mentioned liberal elements.
This
classification is presented only for the user’s convenience and does not
formulate an official definition or categorization of air services agreements.
Time
period between the date of a notice of termination of the agreement given by
one party to the other and the consequent date of actual termination, assuming
the notice is not withdrawn in the interim. Normally it is a fixed period, most
often one year. However, in a few cases agreements indicate that termination
will not occur at the end of that notice period but at the earlier of two
stated subsequent dates. In such cases the notice period entered will not be a
fully accurate indicator.
Compliance
Requirement
of compliance by the airline(s) of one party with the laws and regulations of
the other concerning aircraft operation and navigation and/or the admission and
departure of aircraft, passengers, crew and cargo.
Some agreements incorporate this
provision by referencing to Articles 11 and 13 of the Chicago Convention.
Transit Procedures
Provision for
transit passengers, e.g. for simplified control procedures.
Custom Duties
Granting of exemptions for the
other party’s designated airline(s) from customs duties or other charges on
specified equipment and supplies when carried on board. Can be on the basis of
reciprocity, on the basis of the “most favoured nation treatment” principle or
merely stated as the granting of an exemption. The obligations assumed by the
parties under this type of provision are usually additional to those in Article
24 of the Chicago Convention. Some agreements refer to Article 24 rather than
specifying any exemption. In such cases this provision is considered to exist.
Taxes
Exemption
from taxes, usually on the basis of reciprocity, on airline revenues or profits
earned in the territory of the other party.
The provision may at times be
found in the context of a transfer of funds clause. It does not, however,
encompass exemption from income taxes on the salaries of airline
representatives.
Imposition
Clause on user charges for
airports and air navigation facilities. Some agreements this provision may be
incorporated by reference to Article 15 of the Chicago Convention.
Principles
Principles to be applied to the
imposition of user charges, such as non-discrimination, no preferential
treatment and “most favoured nation treatment”. Again, these principles may be
incorporated in the agreement by reference to Article 15. A reference to a
particular schedule of tariffs is not considered to be a user charge principle.
Security
Agreement contains an
undertaking to act in conformity with the provisions of the Tokyo (1963), Hague
(1970) and Montreal (1971) Conventions, and/or the ICAO Standards and
Recommended Practices set out in Annex 17 – Security – Safeguarding
International Civil Aviation against Acts of Unlawful Interference. Also
includes cooperation in situations involving aviation security, including any
bilateral communications or actions taken to prevent, suppress or terminate
threats or acts of unlawful interference.
Safety
Specific provision for safety, for
example, each party may request consultations concerning the safety standards
maintained by the other party.
Recognition of Certificates
Recognition
by one party of the validity of certificates of airworthiness, certificates of
competency and licences issued by the other party.
In some agreements this may be
incorporated by reference to the Chicago Convention, in most cases by reference
to Article 33 and sometimes to Articles 32 and 33.
Amendment
Provision
which establishes procedures for the amendment or modification of the
agreement.
There may be a more formal procedure for the basic text with a more simplified
process for altering some aspect of the agreement such as the route exchange.
Consultation is likely to be an integral part of the amendment process.
Consultations
Consultation between the
parties, for whatever purposes and following either detailed or unspecified
procedures.
Consumer Protection
Indicates a
provision on consumer protection.
States have the flexibility to develop consumer protection regimes. ICAO
developed a set of high-level, non-binding, non-prescriptive core principles on
consumer protection in consultation with States and major industry
stakeholders. The core principles were adopted in June 2015 and comprise the
elements of the passengers’ rights and clear guidance before, during and after
the travel.
Environment Clause
Special aviation environmental
clause for parties to take into account the impact of air transport industry on
the environment. This clause may set out general support by the parties to
support the need to protect the environment by promoting sustainable
development and may also include an undertaking to comply with the ICAO SARPs
of Annex 16 and/or other ICAO policy and guidance on environmental protection.
Immigration/Travel
Documents
Control of travel documents
required for entry into or transit through the territory of the other Party as
well as procedures relating to treatment of inadmissible persons.
Multilateral Agreements
May require
the future modification and conformity of the agreement with any multilateral
air services agreement that may be accepted by both parties.
While the settlement of disputes
in most agreements is usually set out as a two-stage process, the first being
consultation followed, if necessary, by arbitration, some agreements make use
of a mediation mechanism, a mediator or panel, to resolve disputes in a more
efficient and expeditious manner.
Consultation
Procedure for
consultation and/or negotiation between the airlines, the aeronautical
authorities or the governments.
In some agreements direct negotiations between the parties constitutes the only
means of settling disputes.
Mediation
Provision for
an intermediate level between the two stages of consultation and arbitration.
Arbitration
Establishment of an ad hoc
tribunal in the event that the consultation process does not resolve the dispute, or the referral of a dispute to ICAO, to its
Council or to a tribunal established within ICAO, for advice or decision.
On Request
The exchange
of statistics on request of one party.
The exchange of statistics may
be mandatory, upon request or required only in cases of disputes over capacity.
Might also include requirements for airlines to exchange
statistics on request.
At Intervals
Exchange of
statistics at specified intervals.
Might also include requirements for airlines to exchange
statistics at intervals.
1st/2nd Freedom
Many
States have exchanged the rights for overflight and technical stops for
non-traffic purposes through the International Air Services Transit Agreement
(IASTA). Where both partners of air services agreement are also parties to the
IASTA, the element is, nevertheless, commonly included in air services
agreement. In some cases the exchange is limited to prescribed routes.
1st Freedom
: The
right to fly over a foreign country (i.e. just usage of the airspace)
2nd Freedom
:
The right to stop for maintenance and refuel at a foreign
country on the way to another country (i.e. usage of airport ground handling
facilities without any unloading of cargo or passengers in the foreign country)
3rd/4th Freedom
Grant of the
Third and Fourth Freedom rights between each other’s territory, sometimes for a
specific route or routes but more generally for all agreed routes.
3rd
Freedom
:
The
right to fly from one's country to another (direct routing, straightforward,
mostly with the 4th Freedom).
4th Freedom
:
The right to fly from another' s country back to the home
country (direct routing, straightforward, mostly with the 3rd Freedom).
5th Freedom
Grant
of Fifth Freedom rights to one party between a
point/points in the other party’s territory and intermediate and/or beyond
points in third countries on the route(s) granted. Fifth Freedom rights are
considered to have not been granted where a route granted to one party names
one or more intermediate and/or beyond points in third countries but denies
local traffic rights between such point or points and the other party’s
territory, or where the general grant of such rights is made subject to
subsequent agreement. However, if their use is only made subject to future
specification, such as selection of a point or points, such rights are
considered to have been granted
5th Freedom
:
The right to fly between two foreign countries during
flights while either originating or ending at one' s home country.
·
For example, Airlines can do a route from Home State to
State A to State B; or State B to State A to Home State if and only if State A
has granted Home State the right for its carriers to carry load through State A
to or from another third country.
6th Freedom
Grant of the
Sixth Freedom rights of transporting, via the State of the carrier, traffic
moving between two other countries.
6th Freedom
:
The right to fly between two foreign countries while
stopping at one' s own country for non-technical reasons
7th Freedom
Grant
of the Seventh Freedom rights to one party between a point or points in the
other party’s territory and any point or points in third countries with no
requirement to include on such operation any point in the territory of the
recipient party, i.e. the service need not connect to or be an extension of any
service to/from the recipient party of the carrier.
7th Freedom
:
The right to fly between two foreign countries while not
going through one' s own country
Cabotage
Grant of cabotage
traffic rights to one party between two points in the territory of the other
party, either on a service which originates or terminates in the home territory
or outside the territory of the granting party (also known as the Eighth
Freedom or “consecutive cabotage”), or on a “stand‑alone”
service performed entirely within the granting party’s territory (also known as
Ninth Freedom rights.)
8th Freedom
:
The right to fly between two domestic points in a foreign
country on a flight that originated or ended at the home country.
9th Freedom
:
The right to fly between two domestic points in a foreign
country without passing, starting or ending at the home country.
Non-scheduled
Operations
Provisions
may be found among the administrative clauses of the agreement, in the route
exchange or in a separate annex, protocol or exchange of notes. They may
concern authorization or acceptance of non-scheduled operations, applicable
charter worthiness rules, guiding principles or identification of provisions of
the agreement which apply to non-scheduled operations.
Can
cover special provisions for capacity, grant of traffic right or other
provisions in the agreement.
All-Cargo
Operations
Special
provision(s) exist(s) for all-cargo operations, which might be of an
administrative nature or be an identification of the provisions of the
agreement that apply to all-cargo operations.
Can cover
special provisions for capacity, grant of traffic right or other provisions in
the agreement.
Ground Handling
Allows a designated airline to
perform its own ground handling or, at its option, to select its own ground
handling agent in the territory of the other party. Alternatively, the
provision might anticipate an agreement on ground handling between the airlines
or the parties themselves. Can also be part of a provision on technical
maintenance, although a clause on technical maintenance per se, does not
necessarily cover ground handling.
Slot Allocation
Specific clause dealing with slot allocations, which may define
principles for a slot allocation system (e.g. fair, non-discriminatory and
transparent procedures, global compatibility, practicability, sustainability,
etc.)
and/or may refer to the IATA scheduling mechanism for slot
allocation.
Computer Reservation Systems
Access,
availability and requirements of computer reservation systems and guidelines
for their use may be covered in an agreement.
Currency Conversion and
Remittance
Facilitating
or ensuring currency conversion and/or remittance of funds by the designated
airlines, usually without restrictions. Alternatively, it may refer to separate
arrangements in place between the parties and will be coded as existing so long
as the objective of facilitating the transfer of funds can be construed from
the text.
Establishment of Offices and Airline Representation
Right of a designated airline to establish offices and/or commercial,
technical or operational personnel in the territory of the other party.
The
right of establishment may be implicit, for example where a designated airline
is granted the right to sell air transportation directly in the territory of
the other party.
Leasing
Reference to leasing, such as a
provision for a designated airline when using a leased aircraft on the agreed
services and/or conditions to ensure
that such arrangements do not grant traffic rights to airlines of third parties
(i.e. to the airline from which the aircraft is leased).
Local Currency Sales
Grants
the designated airline of the other party the right to sell air services in the
currency of that other party or in a freely convertible currency.
Selling and Marketing
Guidelines
for marketing, selling and advertisement of airline services.
A clause may also include
provisions on the appointment by one airline of the other party’s airline as
its sales and marketing agent in the other’s territory.
Change of Gauge
Right to
change to a smaller aircraft (or more under some agreements) at a point along
the route outside the home territory.
The usual purpose of the right
is to achieve economies of operation. It may be granted for specific stops on
particular routes or as a general right applicable at any stop along the agreed
routes under certain conditions.
Code-Sharing/Cooperative Arrangements
Cooperative
marketing arrangements such as code-sharing.
The designated airlines of the parties may enter into arrangements with any
other airline whereby services under the agreement on any route or sector of a
route may carry the designated airline’s code, in addition to that of the
carrier operating the flight, as though those services were its own. The
designated airline may be required to have the authority to exercise traffic
rights over the whole of the route and the other airline required to have the
authority to exercise traffic rights over the sector or route segment. In
addition, States may require airlines to provide the necessary information
regarding the operator of the code-share flight to passengers.
Code
Share with 3rd Parties
Airlines may enter into code sharing agreements with
more than one airline for routes/sectors they want to operate, especially, if
they are the members of an alliance. In this case, outside regional blocks in
which intra-regional traffic is liberalized (and depending on the various air
services agreements involved),it might be necessary for the code sharing
partners to obtain approval from three separate governments (or even more in the
case of multi-stop flights). In addition, States may require airlines to
provide the necessary information regarding the operator of the code-share
flight to passengers.
Intermodal
Right
of access granted by one party for use by a designated airline of the other
party to extend, substitute for or supplement air services
by use of surface conveyances. States may give their
designated airlines the right to use intermodal transportation in conjunction
with the international air transport of passengers and cargo accordingly.
State
Aids/Subsidies
Specific
provision on government subsidies and support, such as a dedicated article on
State Aids/Subsidies or provisions on this topic in other articles, such as
articles on Fair and Equal Opportunities, Pricing or Competition.
Nationality Clause
Authorization or permission for
a designated airline of the other party to operate may be withheld or refused
if certain specified conditions are not met. A usual condition is that
substantial ownership and effective control be vested in the designating party
or its nationals. However, other conditions, such as compliance with the laws
and regulations of the State, may also be specified. The withholding provision
is considered to exist even if phrased implicitly, for example where a party
agrees to grant the appropriate authorization subject to the substantial
ownership and effective control criteria being met.
Community Group
A party would accept a foreign
designated airline to operate the agreed services under the condition that
substantial ownership and effective control is vested a) in one or more
countries that are parties to the agreement or by any one or more of the
parties themselves, i.e. a joint operating organization or a multinational
carrier created by intergovernmental agreement; or b) in one or more countries
that are not necessarily party to the agreement but are within a predefined
group with a “community of interest”.
Principle Place of Business
A party’s acceptance of a
foreign airline if the carrier is incorporated in the designating party and its
principal place of business or permanent residence is also in the designating
party, including one incorporated and having its principal place of business
in, and effectively controlled by the designating party, which removes the
substantial ownership requirement. Some agreements may also refer to the
requirement of the airline holding a current Aircraft Operator’s Certificate
issued by the aeronautical authority of the other party.
Regulatory control
A
party’s acceptance of a foreign airlines in the case
that the aeronautical authority of the other party has and maintains the
regulatory control over the designated airline.
Revoking Authorization
Revocation
of authorization to operate agreed services are
often combined with the
withholding provision although they are usually drafted in broader terms.
Revocation provisions may include alternatives such as suspension or imposition
of special conditions or limitations, whenever certain requirements are not
met. These requirements may include substantial ownership and effective
control, compliance with laws and regulations or maintenance of safety and
other operational standards.
In distinction to the “fair
competition” category below, the following provisions are normally included in
articles covering other topics, such as capacity, and do normally not
constitute a standalone provision themselves.
Operate
indicates
that each party shall ensure
fair and equal opportunity for the designated airlines to operate agreed
services.
Compete
indicates
that each party shall allow
fair and equal opportunity for the designated airlines to compete in providing
agreed services.
Unfair Practices
deals
with the commitment of each
party to prevent unfair competitive practices adversely affecting the
consumers’ benefit and/or competitive position of the airlines of the other
party. In addition, it may include the prevention of unfair or unreasonably
discriminatory practices such as with regards to capacity, tariffs and the
protection of consumers.
Competition Clause
Inclusion of
a special provision on fair competition.
Even though a clause on fair
competition can often be found in the articles on capacity (based on the
wording in the Convention (Article 44 f)) which refers to “fair opportunity to
operate international air services”) this item is only indicated if there is an
extended clause on fair competition setting out further principles.
The capacity clause represents a
mutually agreed approach by two governments to a matter of fundamental
commercial and operational importance to their designated airlines. Sometimes
the classification may not represent the actual arrangements followed by the
parties due to confidential memoranda of understanding or exchanges of notes,
which are not registered with ICAO or published otherwise. In addition to the
provisions of the capacity clause capacity principles or mechanisms can be
included in the route exchange, either as capacity criteria or as arrangements
in relation to a route or routes.
Bermuda I
Governments set out the capacity
principles for the designated airlines to follow but allow each airline the ex
post fact review by the governments through their consultation procedure. These
principles, concepts and wording of the Bermuda I system of capacity control,
as negotiated between the United Kingdom and the United States in 1946, have
been adopted widely in bilateral agreements. However, the adoption of
Bermuda-type phraseology does not always signify acceptance of the practical
application of Bermuda principles; the parties may clearly intend to
predetermine capacity. Only those capacity arrangements are classified as
Bermuda I which are “purely” Bermuda I in both their
format and their functioning.
Free-Determination
Allows
capacity to be decided by designated airlines free of regulatory control.
The parties agree that neither
shall unilaterally limit the volume of traffic, frequency, or regularity of
service or the aircraft type operated by the designated airlines of the other
party, except as may be required for customs, technical, operational, or
environmental reasons under uniform conditions consistent with Article 15 of
the Chicago Convention. The clause may also commit each party to ensure fair
competition.
Pre-Determination
Capacity be
agreed to prior to the commencement of the operation, either by governments or
their aeronautical authorities or between their designated airlines subject to
government approval. Where the capacity provision is similar to a Bermuda I
clause but a separate provision requires consultation on or coordination of
capacity or the filing and approval of frequencies or schedules in advance, the
reference file classifies it as predetermination. Similarly, an otherwise
Bermuda I agreement may state that the aeronautical authorities should jointly
determine the practical application of the capacity principles. This implies
their focussing on capacity , the essence of
predetermination. If the capacity provision is not otherwise clearly one of
predetermination or any other defined type, but requires that capacity
increases be approved by the relevant authorities, the clause is categorized as
predetermination.
Other
This element comprises those
agreements where capacity and related provisions cannot be classified as any
one of the above three types, e.g. being a hybrid of more than one or not being
identifiable as any one of them.
Capacity
Principles
General
principles governing capacity.
Statements of such
principles are standard in Bermuda agreements. For example, the statements may
call for fair and equal opportunity to operate (or to compete), for airline
capacity to be related to traffic requirements, and for each party and airline
to take into consideration the interests of the other party and airline(s).
Predetermination clauses often add a reference to equality and mutual benefit
or equitable results.
Capacity
Control
Formula
to control capacity between the territories of the two parties.
It is often found in predetermination arrangements and may either be part of
the clause itself or included in the route schedule. The formula envisages a
specific division of capacity or refers to maximum or minimum frequencies.
Principles
(3rd parties)
General
principles governing capacity for traffic destined for and coming from third
countries at a point or points on the routes specified in the agreement. The
best example is the Bermuda I provision of the right to embark and disembark
such traffic subject to the general principle that capacity be related to
certain enumerated traffic and operational requirements. Another example is
giving the carriage of such traffic a subsidiary or supplementary role. It is
presumed that whenever such rights are exchanged the principles governing
capacity in element A above will also regulate them
unless otherwise indicated. However, the existence of principles concerning
these rights does not necessarily imply an exchange of routes involving points
in third countries.
Capacity
Formula (3rd parties)
Formula
to control capacity for traffic to and from third countries at a point or
points on the routes specified in the agreement. In most cases the division of
capacity or frequencies applies to total capacity; however, some agreements
have a separate formula for third country traffic.
Excluding
Unilateral Control
Excludes
unilateral capacity controls. Although normally indicative of a free‑determination
arrangement, such principles also exist as reinforcements to Bermuda I regimes.
Cooperation
on Capacity
Permits
or requires commercial cooperation on matters which could affect capacity. The
arrangement is often set in general terms and capacity is merely one of a set
of matters that may be covered by an inter-airline arrangement on pooling and
joint operations. The authority to negotiate an arrangement may be permissive
or mandatory and governmental approval may or may not be required.
Filing
Requirement/Approval of Timetables
Requirement
to file capacity, frequencies, timetables and/or schedules for governmental
approval.
This requirement arises most
frequently under predetermination and may, with other features, be indicative
of its presence, but can also be found under the other types of capacity regimes.
It may be part of the capacity clause but is more frequently separate or in the
route schedule. This element may include a time period and is considered to
exist even if it relates only to increases in capacity.
Capacity
Transfer
Provision
for transferring scheduled capacity. It applies when one of the parties is
unable or unwilling to exercise certain operating rights under the agreement
and assigns to the other party or airline the whole or part of its capacity
entitlement. It is usually a temporary arrangement conditional on the
restitution, at the initiative of the transferring party, of its original
rights.
Tariff
clauses in bilateral agreements vary greatly in their coverage, phraseology and
degree of detail. The tariff clause, as presented here, has four main
sub-headings: scope of applicability, tariff approval ,
tariff establishment and tariff control process. Within this format the
essential elements of the more “traditional” arrangements together with the
main new types of tariff arrangements are identified.
Agreed
Services
Applicability
on the agreed services, which is usually indicated by wording such as “to or
from the territory of each contracting party” or “for services covered by this
agreement”.
Between
Territories
Applicability
only between the territories of the contracting parties.
Occasionally an agreement with this latter scope of applicability has separate
but less extensive arrangements for tariffs involving third parties.
While there are five types of
tariff approval regimes, some agreements, however, contain two or more regimes,
each of which govern different types of tariffs.
Dual Approval
Dual approval
method where approval by the aeronautical authorities may be given expressly or
tacitly.
This method of “dual” or “double” approval requires the approval by both
parties of tariffs or agreements on tariffs before those tariffs can take
effect. Express approval is evidenced by the use of “must”, “will” or “shall”
and tacit approval is possible, for example, by “may give approval expressly”
or by an indication that the tariff will be considered as approved if neither
of the parties has notified or expressed disapproval within a defined period.
Dual Disapproval
Under this method of “dual” or
“double” disapproval, tariffs become effective unless both aeronautical
authorities disapprove them. As with the country of origin and the free pricing
methods, the objective is to limit governmental involvement and to increase
tariff flexibility for the designated airlines.
Country of Origin
A party may approve or disapprove
tariffs only for originations in its own territory.
Free Pricing
Tariffs shall not be subject to
the approval of any party. Some agreements may allow parties to require
notification of tariffs for informational purposes only.
Zone Pricing
Involves a reference point or
points around which various types of tariff control are agreed. The parties
agree to approve tariffs falling within a specified range of prices and meeting
corresponding conditions, though tariff filing may still be necessary. Outside
of the zone, one or a combination of the above mentioned regimes may apply.
Tariff Filing Requirements
Tariffs require the formal
filing including the filing period for submission of tariffs, usually a minimum
number of days before the proposed date of effectiveness of applicability.
Flexibility to change the period is sometimes included.
Factors/Principles
Relevant
factors governing tariff establishment, for example “characteristics of
service”, “commercial considerations in the marketplace”, “cost of operation”,
“interests of users”, “preserving and enhancing competition”, “reasonable
profits”, and “tariffs of other airlines”.
Initial
Mechanism
Airlines
have the initial responsibility for the negotiation of tariffs. An arrangement
that is usually found in “traditional” tariff mechanisms, it may be explicit or
implicit, example where the setting of tariffs is based on the results of rate
conferences of the International Air Transport Association (IATA). If, however,
the aeronautical authorities are initially charged with determining the
tariffs, as is the case in some agreements, this element is not present.
Multilateral
Mechanism
Multilateral
tariff mechanism or to multilateral consultations at the airline level, and
will be likely indicated by a specific reference to IATA (with differing
degrees of utilization of that organization’s mechanisms and procedures), to
“international rate fixing mechanisms” or to “consultations between the
airlines operating over the agreed routes”.
Secondary
Mechanism
Secondary
tariff establishment mechanism, whereby the aeronautical authorities or
contracting parties must negotiate and agree on a tariff if the initial airline
mechanism, including the tariff approval process, fails to produce agreement on
a tariff.
It covers the failure of airline
consultations as well as disapproval by one or both authorities.
Disputes
Settlement
of tariff disputes. This may be indicated by a reference in the tariff article
to the agreement’s dispute settlement arrangements. However, a separate
arbitral dispute mechanism especially for tariffs may also exist. In either
case, the arbitral mechanism for tariff disputes would come into effect only in
the event of a failure by the aeronautical authorities or contracting parties
to reach agreement.
Cargo
Specific
provisions for cargo tariffs.
They may have some of the same distinctions made with respect to passenger
fares and are determined using similar pricing practices and concepts, but with
different terminology.
Non-Scheduled
Non-scheduled
tariffs or pricing may be found in the existing tariff provision, where an
agreement covers both scheduled and services, or it
may be in a separate provision, such as one dealing exclusively with
operations. The controls in the latter case are unlikely to be as detailed as
the processes applicable to scheduled service tariffs, and may merely be
surveillance of prices.
Third Parties
Tariffs
on routes involving third countries.
It may refer to the
need for approval of tariffs charged by the designated airline of one party for
carriage between the territory of the other party and the territory of a third
party, involving also points other than on agreed services. This element may
also cover a provision on “matching” of tariffs whereby each party would allow
any designated airline of either party to meet a lower or more competitive
tariff for service between either of the parties and a third country.
A route name appears in column
‘Type” at the left of each route description to indicate the country to which
the route was granted. The route name “A” stands for the country named as first
party to the agreement; the route name “B” indicates the other party to the
agreement.
There are four principal columns
under which each route is described: (1) points in Party A,
(2) intermediate points, (3) points in Party B and (4) beyond points.
(1)
“Points in Party A” on a route are points in country “A” for the route(s) called “A”, and
those in country “B” for route(s) called “B”;
(2)
vice versa,
“Points in Party B” are points in country “B” for an “A” designated route and
those in country “A” for a “B” designated route;
(3)
Intermediate
points are points between Party A and Party B;
(4)
beyond
points are those beyond the
“Points in Party B”; beyond points may also be indicated in a separate,
previous line, when referring to points before “Points in Party A” (i.e. behind
points).
A letter “A” through “N” to the
immediate right to a point indicates a condition or restriction applicable to
that/those points. When such code letter appears under “General Conditions” it
indicates a condition or restriction is applicable to the route as a whole.
An
agreement usually contains route schedules and frequently contains conditions, some
in the form of restrictions, which attach to some or all of the agreed routes
or to the exercise of rights along those routes. Conditions applicable to
routes and rights can take many forms but it is possible to broadly identify
and classify a number of frequently used conditions. Only the conditions
applicable to a route are shown.
Condition “A”
– Allowance for Additional Traffic Point(s)
indicates
that traffic point or points additional to those exchanged by the parties are
allowed. They may be optional, may have to be nominated or may have to be
agreed between the parties. Frequently an agreement will provide that an
additional point or points can be chosen or nominated for the agreed routes of
one or both parties. It can be applicable to originating, intermediate,
destination or beyond points but must concern traffic points and not merely
technical stops in order to be included.
Condition “B”
– Exemption of Certain Operations or Routes from Restriction
identifies
a provision which specifically exempts certain operations from any
restrictions. Such a provision may be applicable to all of the agreed routes or
rights but is more likely to be directed at a particular aspect or part of the
route exchange, for example, a condition which says that flights may be
operated on a certain route without any limitations on the type or number of
aircraft. An agreement containing a provision in the route schedule exempting
operations from any restrictions and classified as “Full liberalization” is
indicative of an “open skies” agreement.
Condition “C”
– Allowance for Omission of Points with or without Permission
indicates
a provision specifying that omission of points along the route by the
designated airline is allowed, with or without permission of the other party
(although the service must, of course, originate outbound and terminate inbound
at a homeland point).
Condition “D”
– Time Restrictions on Exercise of Rights Granted
indicates
a time restriction on the exercise of some or all of the rights granted, their
commencement or termination. The time reference must be specified as a time
period, rather than as one action conditional on another action, to be
included.
Condition “E”
– Restrictions on Designation of Airlines
indicates
a reference to designation of airlines. This is most likely to occur where
there is multiple of airlines and the route schedule
or the text stipulates the number of airlines permitted to operate on
particular routes, possibly until a further condition has been met.
Condition “F”
– Restrictions As to Number of Points Served on Route
indicates
restriction on the number of points which may be served on a route; for
example, traffic rights limited to use at “a point” or “two points” among the
intermediate, second country or beyond points of a route.
Condition “G”
– Limitations on Capacity, Frequency or Scheduling on Particular Route(s)
indicates
a limitation on capacity, frequency or scheduling. It is not unusual to find in
a route schedule specific limitations or conditions established for capacity,
for example, maximum or even minimum frequencies along a particular route.
Condition “H”
– Reference to Stopover
indicates
a reference to stopover in the text or in the notes to the route exchange which
has traffic rights implications, for example the number of hours passengers
must stay at a point for their stay to be considered as a stopover.
Condition “I”
– Scheduled All-Cargo Routes Only
indicates
scheduled all-cargo routes only. When placed in the General Conditions column
of the route exchange, this identifies routes established exclusively for
all-cargo services
Condition “J”
– Non-Scheduled Routes Only
Indicates
routes for non-scheduled flights only.
When placed
in the General Conditions column of the route exchange, this identifies routes
established exclusively for non-scheduled services.
Condition “K”
– Separate Agreement or Exchange of Diplomatic Notes Concerning the Route Exchange
indicates
a reference to a separate agreement or exchange of diplomatic notes concerning
the route exchange. The agreement need not specifically state that there is a
condition which will be the subject of a separate agreement; it may simply
indicate that there is to be a separate agreement on a particular matter. Note
that a condition indicating a subsequent exchange of third country rights is
not covered here, but under Condition M.
Condition “L”
– Geographic Restriction on Exercise of Traffic Rights Within
a Country of Region
indicates
a geographic restriction within a country or region. This may take a variety of
forms. It is frequently used to limit traffic rights in a particular country or
geographic area which is named in the route exchange.
Condition
“M” – Other Significant Operational or Traffic Conditions/Restrictions
indicates
a reference to other operational or traffic conditions and/or restrictions.
This final condition is fairly general in nature and is likely to cover a
variety of different situations. The main criterion for inclusion is that the
condition has an operational or commercial significance for the route exchange.
Some examples are nomination of a terminal point, regional “cabotage”
(i.e., traffic rights restrictions on operations between certain points in
separate countries but considered to be reserved as if the traffic were “cabotage”) and agreement to negotiate later on intermediate
or beyond points.
Condition
“N” – Code Share Routes
indicates
a reference to code-sharing
provisions on a certain route. This means that one party grants the other party
the right to use a certain route (or parts of a route) in cooperation with (a)
code-sharing partner(s).
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