On 14 January 2016, the new Air Transport Agreement between the Government of the United States of America and the Government of Ukraine (the "Agreement") became effective.
The Agreement establishes the system, known as the Open Skies regime, for decreasing the governmental interference with the commercial decisions of air carriers on the routes, traffic capacity and pricing. This will allow air carriers to provide a more affordable, convenient and efficient air service.
To promote the deregulation of the air transport market, the Agreement expands the commercial opportunities of the airlines of each state party and provides for the following rights thereof:
- "fifth freedom of the air" allowing airlines of each state party to carry passengers, baggage, cargo, and mail from one's own state to a second state, and from that state to a third state (i.e., the right to fly between two foreign countries on a flight originating/ending in one's own country and made through the other state party);
- right of the airlines of each state party to perform its own ground-handling in the territory of the other state party ("self-handling") or, at the airline's option, select among competing agents for such services in whole or in part;
- right of the airline of one state party to enter into cooperative marketing arrangements such as blocked-space, code-sharing, or leasing arrangements, with (i) an airline or airlines of either state party, (ii) an airline or airlines of a third country, and/or (iii) a surface transportation provider of any country;
- right of the airlines of each state party to determine the frequency and capacity of the international air transportation it offers based upon commercial considerations in the marketplace.
Originally published 18 January 2016
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