The exchange of air traffic rights: A system highly flawed, yet seemingly indestructible

  • January 26, 2018
  • Ashley Taborda

This is an abstract of an article in the Annals of Air and Space Law, Vol. 41 (2016), which is published by McGill University's Institute of Air and Space Law. The full article is available to subscribers or for purchase only.

This article examines the current less-than-ideal bilateral system for the exchange of air traffic rights with a view to understanding whether change is feasible. To that end, aviation history is canvassed, the strengths and weaknesses of bilateralism are critically analysed, and alternatives are contemplated.

Finding that bilateralism’s most crucial weakness is that of state involvement, this article ultimately concludes that significant change is far from likely. In the Chicago Convention,Footnote1  states secured themselves a seat at the bargaining table in air traffic rights negotiations by prohibiting scheduled flights into their territories without prior authorization. Because of this guaranteed seat, states are accustomed to a conception of airspace sovereignty that is relatively absolute – and one which states are unlikely to voluntarily renounce. Unfortunately for the commercial airlines of the world, meaningful change to bilateralism is seemingly elusive without such a voluntary renunciation.

Airspace sovereignty and bilateralism

Airspace sovereignty has been and continues to be a crucial doctrine in the development of international aviation law. In the aftermath of The First World War, during which states recognized the importance of maintaining complete and exclusive sovereignty in the airspace above their territories, the Chicago Convention was born, creating what has been described as a form of state ownership in airspace. Although the Convention's original state parties managed to agree that flights could not be conducted into the territory of other states without prior authorization,Footnote2 they were unable to agree on a universal structure for the distribution of air traffic rights.

This inability, driven by the significant national importance attributed to aviation by states and an imbalance in aviation power between states, created the need for restrictions on stronger states' airlines. Without an agreed-upon international body to select, impose, and enforce such restrictions, that function was left to be discharged bilaterally. Today, for the Convention's 192 state parties,Footnote3 a labyrinth of 4,000 air services air services agreements discharges this function.

Bilateralism: A Critical Overview

Beyond the fact that the bilateral system is well established and has served as a flexible method for reconciling opposing state interests, and beyond the successes that regulators have found within the system’s constraints, bilateralism is plainly inconsistent with globalization. Indeed, while the airline industry is “nation-bound,” in the sense that airlines enter foreign markets with one foot firmly planted at home, other industries operate in a world of diminishing economic nationalism. Indeed, airlines interested in serving international routes are left at the mercy of their home states, which must be willing and able to negotiate a concession. Moreover, fuelled by the Chicago Convention's silence on how these negotiations are to be conducted, bilateralism is plagued by power politics between states, and fosters protectionism. Clearly, state involvement in bilateralism is cause for concern.

Unlikely alternatives

While complete deregulation is unlikely due to international aviation’s links to national security, diplomacy, international trade, communications, and national economic development, options do exist. For example, the opportunity did exist, and likely still does exist, to bring aviation within the scope of the World Trade Organization's General Agreement on Trade in Services. Unfortunately, although the WTO has much to offer aviation, the principles on which it is based are very different than those underlying aviation, and little has changed since states rejected aviation's inclusion in 1995. The possibility of a large-scale multilateral agreement replacing bilateralism, while another option, is equally as unlikely in today's global climate.

Through the Chicago Convention, which explicitly recognizes airspace sovereignty and requires state authorization for airspace entry, states effectively delegated authority to themselves with respect to air traffic rights. Through international law, therefore, states guaranteed themselves a seat at the table. A renunciation of this power by states would be to "veer away from the parochial dogma of absolute state sovereignty,"Footnote4 which states are unlikely to do voluntarily. To do so, some have argued,Footnote5 would require reaching a new stage of humankind. Unfortunately, it seems we are not quite there.

Ashley Taborda, a 2017 graduate of Western University‘s JD/MBA program, is currently articling at Osler, Hoskin & Harcourt LLP in Toronto. Before law school, Ashley spent seven years working for Emirates Airlines in Dubai, United Arab Emirates.