Etihad Airways: Do not prejudge outcome of US ‘open skies’ review

Etihad Airways on Sunday urged against prejudgement of the outcome of a review of claims by American carriers against it and other Arabian Gulf rivals.

The US government on Friday set up a forum to hear allegations that the Gulf carriers have breached “open skies” guidelines.

Three US government departments – state, commerce and transportation – issued a joint statement calling for interested parties in the dispute to submit comments for consideration by an “open forum”. Review of submitted evidence is expected to begin at the end of next month.

Three US airlines – American, Delta and United – and some aviation trade bodies have claimed that Emirates Airline, Etihad and Qatar Airways have received and are benefiting from unfair subsidies from their governments, distorting the global commercial aviation market.

A formal report from the US lobby put the amount of subsidy at US$42 billion over 10 years. The Gulf airlines have strenuously denied the allegations and promised to respond in detail to the claims.

A statement on the US department of state website said: “The claims are of significant interest to stakeholders and all three federal agencies. The US government takes seriously the concerns raised in the report and is interested in receiving insights and feedback from stakeholders before any decisions are made regarding what action, if any, should be taken.”

The statement said the move was “consistent with the Obama administration’s open government initiative and commitment to transparency, public participation, and collaboration”.

Information submitted by interested parties can be accessed by all participants in the forum, the state department said. “To the extent allowed by law, the departments will protect trade secrets and confidential commercial or financial information from disclosure,” it added.

In a statement to news agencies, Etihad said it hoped no one would prejudge the outcome of the US forum, and that it was committed to setting the record straight on what it called “unsubstantiated allegations”. It added that it could not respond in full because the American lobby had not provided complete details supporting their claims.

A spokeswoman for Emirates declined to comment.

But it is believed the airline is relaxed about the US open forum, which it regards as an informal process of information exchange rather than an investigation.

Qatar Airways was unavailable for comment.

Saj Ahmad, chief analyst at the London-based consultancy Strategic Aero Research, said: “In the grand scheme of things, this is of no real concern to the Gulf carriers.

“Even if the US airlines could prove their outlandish allegations, it’s unclear what form of punitive action could be taken. The truth is that US passengers are badly served on domestic flights, but have a world of choice when they travel abroad, largely thanks to the Gulf carriers.”

Jill Zuckman, chief spokeswoman for the Partnership for Open & Fair Skies, the lobby body behind the allegations, said: “We are pleased that the US government is taking the next step to further examine the issue of massive subsidies that Qatar Airways, Etihad Airways and Emirates receive from their governments.

“This process is an opportunity for more transparency and we urge the Gulf carriers to adhere to the same standards of financial disclosure and accountability as the US carriers. Their $42bn of state support, a clear violation of open skies policy, has been well documented. They should open their books if they have nothing to hide.”

James Hogan, the chief executive of Etihad, told an aviation conference last month that the actions of the US airlines threatened to halt global airlines expansion, and that a new mood of “protectionism” in aviation was a threat to the health of the industry.

Tim Clark, the president of Emirates, has strongly rejected allegations of subsidies by the government of Dubai, and threatened legal action against the US airlines if their claims are found to damage Emirates’ business.

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