EU lawmakers aims to punish non-EU airlines for unfair competitive practices

Airlines from China, Russia, the Gulf region, and Turkey could face punitive EU measures arising out of the final version of this regulation.

In a significant development, an European Parliamentary committee stated, non-EU carriers could see their rights to fly in the bloc revoked if their home countries, or they themselves, engage in “unfair” competitive practices.

Many European airlines, including Lufthansa and Air France-KLM, have since long complained that airlines from the Gulf region, such as Qatar Airways, Emirates and Etihad, receive illegal state subsidies which amounts to unfair competition.

All three airlines have denied such claims.

Incidentally, all the rules passed by members of the European Parliament’s transport committee are not the final version of the law, they however do represent a stronger version of the original European Commission proposal.

“The pressure from highly subsidized third country carriers is increasingly noticeable. It potentially undermines a level playing field in the market, at the expense of European airlines,” said Markus Pieper, the EU lawmaker who is steering the legislation through the European parliament.

“Particularly carriers from the Gulf region, Turkey, China and Russia have strong state connections which can cause market distortions.”

The proposal allows governments within the European Eunion to submit complaints on alleged discriminatory practices faced by them from non-EU countries or illegal subsidies benefited by non-EU airlines.

Further, this version passed by the European Parliament enables the Commission to impose certain “provisional redressive measures” on the airlines of non-EU countries even before an investigation has been concluded to prevent irreversible injury.

It is to be noted that the EU Commission has not curtailed the flying rights of airlines since these are typically granted, on a bilateral basis, between governments; it has however proposed financial penalties or other measures, including suspension of ground services.

Airlines from Gulf countries are facing similar measures from the U.S.

Lawmakers from the European Union will now have to reach an agreement with member states for the final version of the regulation before it can take effect.

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