Statement on the EU-UK Trade and Cooperation Agreement and the level playing field


26 April 2021

Europeans for Fair Competition (E4FC) welcomes the EU-UK Trade and Cooperation Agreement (TCA). The TCA establishes a regulatory framework for air transport between the EU and UK and is designed to ensure a level playing field. It maintains the previously existing connectivity between the UK and the EU for aviation.

As a coalition of European airlines and unions representing airline employees fighting for fair competition and high social standards, E4FC would like to stress the importance of ensuring a level playing field in the aviation industry when implementing the TCA. In this context, we would like to highlight some concerns:

  1. The provisions of the TCA allow EU Member States to bilaterally agree on additional fifth freedom traffic rights for cargo as well as to approve non-scheduled passenger and cargo services (up to cabotage) with the United Kingdom. The possibility to complement the air transport agreement between the EU and the UK under the TCA could undermine a unified approach and hamper the level playing field, as UK airlines have more to gain than EU airlines. UK authorities are already approaching some EU Member States to agree on additional traffic rights while the TCA has not been ratified by the EU yet. These additional traffic rights should only be granted if they are beneficial for the EU aviation industry and do not distort the EU market.
  2. The TCA includes generous provisions on ownership and control of airlines between the two parties, by maintaining the majority ownership for EU carriers and by additionally allowing UK carriers to be owned and controlled by EU shareholders without losing their qualification as UK carriers. However, the option to examine and possibly amend the ownership and control provisions under the TCA within 12 months from the entry is too short and should be extended as the current provisions are adequate in our view. In addition, to ensure fair competition between the two parties, the regulatory framework on ownership and control should not be undermined by third party ownership of EU or UK carriers. E4FC recommends establishing guidelines that define how the parties provide transparency ensuring that agreed solutions on ownership and control are not circumvented by third parties.
  3. E4FC welcomes the provisions on social standards under the TCA. However, to stimulate a socially responsible aviation sector, it should be further specified how fair social standards in the aviation industry are stimulated under the agreement, preventing circumvention of applicable law and social dumping, i.e. bogus self-employment and fictious home bases. Therefore, E4FC recommends the European Commission to issue clarifications on social standards for the aviation sector within the existing provisions of the TCA to guarantee a level playing field.
  4. E4FC welcomes the environmental provisions under TCA that state environmental levels of protection shall not be weakened or reduced below previous levels and set a level of ambition for future agreements with third countries. However, the new UK Emissions Trading Scheme (UK ETS), that has been put in place since 1 January 2021, needs to be linked with the EU Emission Trading System (EU ETS), without putting the EU aviation industry at a competitive disadvantage.

E4FC calls upon the EU and the Member States to take the abovementioned points into account to ensure a level playing field. This is especially important in view of the challenges the EU aviation industry is facing as a result of the global COVID-19 pandemic and the efforts being made to combat the economic and social impact of the crisis.