On Friday, The United Arab Emirates and the United States quietly decided to reaffirm the 2002 UAE-US Air Transport Agreement (ATA) in a move that should help end the battle that has been going on for years between airlines over the freedom of the skies.
The two countries have been locked in a row over unfair competition, with American carriers appealing to US Congress to review the Open Skies agreement over claims that Gulf airlines received state aid. The Gulf carriers retaliated with claims that their US rivals also received state aid, including subsidies to keep them afloat following the September 11 attacks.
Tension between US and Emirati carriers had until recently been increasing, with American ending its codeshare agreements with Qatar and Etihad just last year.
Now, both governments have agreed to maintain the conditions of the Open Skies agreement, “including all rights to conduct international air transportation”.
In a private meeting at the State Department on Friday, Emirati Ambassador Yousef al-Otaiba and Assistant Secretary of State Manisha Singh signed the agreement, which, according to the Associated Press, will require Emirati carriers—chiefly Emirates and Etihad—to make public their financial statements in addition to stating separately that, at the moment, they have no plans to launch further fifth-freedom routes to the US.
The UAE responded positively to the agreement, with Otaiba saying, “The UAE is very pleased that our understanding with the US preserves all of the benefits of Open Skies for travelers, airlines, communities and aerospace companies in both countries and around the world.”
The reaction in the US was similarly positive. Scott Reed, a representative and strategist for the Partnership for Open and Fair Skies, which represents US airlines, said, “We are extremely pleased that the UAE has finally admitted what we have said all along: that their government subsidies harm competition.”
As an outcome of constructive discussions, all current and future rights for carriers from both sides remain in place, with airlines free to add, reduce or adjust flights and services via third countries.
Both nations have said they will promote best practice when issuing audited financial reports in order to be transparent about any funding carriers may or may not receive.
The deal is expected to be officially announced on Monday, when the Emirati foreign minister will arrive in Washington D.C.