No. H225/05
For release November 11, 2005
OTTAWA - The governments of Canada and the United States have negotiated an
"Open Skies" air transport agreement, Transport Minister Jean-C. Lapierre and
International Trade Minister Jim Peterson announced today.
Potential benefits from the expansion of the 1995 agreement include greater
access for Canadian passenger and cargo carriers to a much larger U.S. market as
a platform from which to serve third countries; increased pricing flexibility
for Canadian and U.S. carriers; more options for Canadian airports to attract
U.S. carriers and lower prices for consumers.
"This further liberalization of the Canada-U.S. air transport relationship will
allow airlines of both countries to better meet the needs of travellers and
shippers," said Mr. Lapierre. "It is my hope that this agreement will encourage
the development of new markets, new services, lower prices and greater
competition."
"The flow of people, goods and services between Canada and the United States is
crucial to how we go about our daily business," said Mr. Peterson. This new
flexibility which goes well beyond the 1995 agreement will improve how the NAFTA
works and it will make North America more competitive."
The most significant amendments involve liberalizing Canadian air carrier access
to United States' third country markets and vice versa. The 1995 air services
agreement between Canada and the United States created an open regime for air
services between both countries. There were, however, constraints regarding air
services between each other's territory and third countries.
This agreement follows through on the pledge made by Transport Minister Lapierre
and U.S. Transportation Secretary Norman Mineta that their departmental
officials would discuss opportunities for further air liberalization. It also
supports the Security and Prosperity Partnership of North America and its goal
of achieving the most vibrant and dynamic trade relationship in the world. These
changes are scheduled to come into effect on September 1, 2006.
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Contacts:
Irène Marcheterre
Director of Communications
Office of the Minister, Ottawa
(613) 991-0700
Lucie Vignola
Communications
Transport Canada, Ottawa
(613) 993-0055
Jacqueline LaRoque
Director of Communications
Office of the Minister of
International Trade, Ottawa
(613) 992-7332
Media Relations Office
International Trade Canada
(613) 995-1874
Transport Canada is online at www.tc.gc.ca. Subscribe to news releases and speeches at apps.tc.gc.ca/listserv/ and keep up-to-date on the latest from Transport Canada.
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BACKGROUNDER
OPEN SKIES AGREEMENT WITH THE UNITED STATES
The Canada-U.S. air transportation market is unique and one of the largest in
the world. The liberalized agreement is expected to provide more opportunities
for better air services, increased flight options, greater efficiencies for
airlines, increased competition and reduced prices. The amended agreement does
not permit a U.S. carrier to carry domestic traffic between Canadian cities or
vice versa.
Scheduled air services between Canada and the United States are governed by the
1995 air transport agreement signed on February 24,1995. The agreement provided
substantial benefits to travellers, shippers and the air transport industries of
both countries by allowing more services, more choice, new efficiencies and
lower prices. Following the signature of the agreement, the Canada-U.S. air
transportation market experienced rapid growth.
While the previous agreement provided open access to the Canada-U.S. market, it
restricted Canadian and U.S. air carriers' access to each other's international
markets. For instance, a Canadian carrier could not pick up traffic in the
United States and fly to another country.
This is one of the reasons the Minister of Transport and the U.S. Secretary of
Transportation agreed in February 2005 that officials would begin discussions on
further liberalization of the air transport relationship between the two
countries. Transport Canada officials subsequently initiated consultations with
a wide range of Canadian stakeholders prior to preparing a negotiating mandate.
Under the amended agreement, air carriers of both countries will be able to:
pick up passenger and/or all-cargo traffic in the other partner's territory
and carry it to a third country as part of a service to or from their home
territory;
operate stand-alone all-cargo services between the other partner's territory
and third countries; and
offer the lowest prices for services between the other partner's territory and
a third country.
Transport Canada estimates that the Canada-U.S. air transportation market
generated approximately 18.6 million passengers in 2004, making it one of the
largest, if not the largest, international air transportation markets in the
world.
November 2005
