The European Union’s Transport Minister is asking for formal arbitration with the United States to ensure Norwegian Air’s United Kingdom-based subsidiary may fly to U.S. airports.
The issue is politically sensitive in Washington, as the three largest U.S. international carriers, as well as many of their employee unions, generally oppose Norwegian’s request. They say Norwegian, with its main office in Norway, should not have the right to use a United Kingdom operating certificate to fly to the United States.
Both Norwegian and Violeta Bulc, the European commissioner for transport, see it differently. They argue the United Kingdom has already approved Norwegian’s subsidiary, and they note that once that happens, the United States usually quickly follows and approves the airline’s application. In this case, the U.S. Department of Transportation has declined to act, saying in June it needs more time to study the issues. It has not told the European Union when it will make a final determination, Bulc said.
Norwegian wants its UK subsidiary to fly U.S. routes in part so it can simplify its operation. With its Norway traffic rights, Norwegian already may fly from anywhere in the European Union to any airport in the United States. But Norway has less liberal air treaties with many other nations, so the airline has created a UK-based airline to fly other international routes. A UK-registered operation that could fly to the United States, as well as to many airports in Asia, would make the company’s operations more efficient.
Norwegian has created an Irish subsidiary for similar reasons. That business is also opposed by some U.S. interests, though in April it received preliminary approval from the U.S. government.
In recent letter to U.S. Transportation Secretary Anthony Foxx, Bulc said she had no choice but to request arbitration in the UK matter.
“I find it regrettable that this is the outcome after more than two years of deliberations and despite the patience and the goodwill that the EU has shown,” Bulc wrote to Foxx. “I have initiated the decision to formally request arbitration.”
Bulc also suggested the disagreement could have fallout beyond this issue.
“I am also concerned, as [are] some of my colleagues, about the consequences this matter could have, not only in our aviation relations, but in the overall economic and trade economic trans-Atlantic agenda,” she wrote.
Anders Lindström, a U.S.-based spokesman for Norwegian, said in an email that the airline is pleased with the EU’s request “to solve this long overdue issue.” He added that Norwegian’s UK subsidiary “meets all the requirements under the Open Skies agreement between the EU and the U.S.”