December 15, 2014

Norwegian submits formal complaint about differential treatment to the EU and ESA

Norwegian wants equal conditions of competition in the Scandinavian aviation market and has therefore submitted a formal complaint regarding unlawful differential treatment in favour of SAS to the European Commission and ESA (EFTA Surveillance Authority). Discriminatory conditions and liscencing practises prevent Norwegian from obtaining access to traffic rights on the same terms as SAS; in addition the differential treatment generates significant additional costs for SAS’ competitors in Scandinavia. The authorities argue that the differential treatment is justified by “grandfathered rights” due to historic explanations mainly because of the fact that its majority owners are the governments of Norway, Sweden and Denmark. Norwegian has for the past five years on numerous occasions applied for and requested equal treatment and conditions to no avail. Every time, the rejections by the Scandinavian national aviation authorities have been justified by SAS’ historically defined conditions and that its majority owners are the governments of Norway, Sweden and Denmark. The issue at hand revolves around a joint Air Operator Certificate (AOC) that SAS benefits from and that Norwegian is denied access to on equal terms. Norwegian has not until now filed a formal complaint to European authorities, hoping and trusting that Scandinavian aviation authorities would create an equal set of rules for all the companies operating in the same market. The European Aviation Safety Agency (EASA) has also criticized the special treatment and concluded that the preferential treatment is in breach of European law. Still it has prevailed. A major competitive disadvantage for Norwegian compared to SAS is its limited access to traffic rights – or the ability to open new routes. The joint Scandinavian AOC, which only SAS benefits from, gives access to traffic rights both within the EU and EFTA (Norway), an advantage not available to Norwegian as Norway is not a part of the EU. If Norwegian had the same traffic rights, it would be able to operate, for instance, flights between Helsinki and Dubai, London and Tel Aviv and Barcelona and Tel Aviv. Norwegian recently applied to the authorities to get access to these routes, but was denied because the airline does not hold an EU AOC.



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