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Continental urges US to make open skies agreement that has practical value to US airlines.

AIRLINE INDUSTRY INFORMATION-(C)1997-2005 M2 COMMUNICATIONS LTD

According to Continental Airlines (NYSE: CAL) statements this week from the European Union clearly acknowledge that European approval of an EU-US open skies agreement hinges on Europe getting the US to relax federal laws on foreign ownership and control of US airlines.

The airline said that, in its latest statements, the EU has clearly expressed doubts about the US Department of Transportation's ability to change the interpretation of this law on foreign ownership without legislative action by the US Congress. With open skies and foreign ownership/control so strongly linked, it is clear that the two sides have plenty of negotiating room to address important related issues not covered by the text of the proposed open skies agreement, Continental said.

The airline takes the view that the key issue that the US has failed to address is that the proposed open skies agreement does not give US airlines the true ability to operate at Europe's largest airport, London's Heathrow. While an open skies agreement theoretically permits flights to Heathrow, there are no commercially viable slots and facilities available at Heathrow that would allow an airline like Continental to begin service there, and therefore the US needs to address the anti-competitive Heathrow situation. Continental feels that there is no reason to put out the US "welcome mat" for European airlines if their US counterparts remain locked out of Europe's front door.

Continental is urging the US government make an agreement that has practical value for all US airlines, which already have access to almost any airport in Europe except Heathrow.

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Title Annotation:Department of Transportation, European Union
Publication:Airline Industry Information
Article Type:Brief Article
Geographic Code:1USA
Date:Dec 8, 2005
Words:279
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