Gov’t urged to revoke foreign carriers’ air rights if open skies not reciprocated

Posted on May 08, 2011 10:25:05 PM
Business World

BUDGET CARRIER Cebu Pacific urged the government to revoke air rights of foreign carriers whose home countries fail to grant similar privileges to airlines based here even as the implementing rules of the “pocket open skies” policy do not bind state agencies to do so.
“Despite the lack of reciprocity in the implementing rules, [we] remain hopeful that the CAB (Civil Aeronautics Board) will hold faithful to its promise that they will revoke the air rights of foreign carriers with home countries that fail to give similar unlimited access to Philippine carriers to their skies,” Cebu Pacific said in a statement yesterday.

The CAB finalized last Friday the implementing rules of Executive Orders (EO) 28 and 29. A provision there states that CAB has the right to revoke, suspend or restrict any operations granted should no reciprocal air rights be granted to local carriers.

CAB Executive Director Carmelo L. Arcilla similarly told reporters last Friday that the Palace order also allows the CAB to withdraw air rights “if shown to cause actual and unfair competitive disadvantage to Philippine carriers.”

However, national interest -- tourism and its effects on the economy -- is stated in the rules to be the prevailing principle to be considered when such decisions on revoking air rights are mulled.

With EO 29’s implementing rules now finalized, the “pocket open skies” policy can take effect later this month if its publication in a newspaper is expedited.

EO 29, dated March 14, allows negotiators to offer foreign airlines third, fourth and fifth freedom rights, plus frequencies and capacities, to Philippine airports other than the Ninoy Aquino International Airport.

Waivers to frequencies/capacities under existing air services agreements will also be allowed.

The freedoms -- part of a set of commercial aviation rights also known as the nine “freedoms of the air” -- involve, in numerical order, the right to fly from one’s own country to another; fly from one country to one’s own; and fly between two foreign countries while the flight originates or ends in one’s own.

In no case should cabotage rights -- involving the transport of goods and passengers between two or more points within the Philippines (covered by the eighth and ninth freedoms) -- be granted to any foreign carrier, EO 29 states.

Cebu Pacific went on to say that it was “disappointed” with how the implementing rules turned out.

“Cebu Pacific is naturally disappointed with the approved [rules], especially since we have expressed our concerns on reciprocity right from the start,” it said.

“Cebu Pacific can compete with foreign carriers if given a level playing field of equal and reciprocal traffic rights ... We would, however, like to assure the government of our continued cooperation, and full support of their objectives to boost tourism,” it said.