Feds reject Norwegian Air bid for expedited US flight approval

by Keith Laing, The Hill Newspaper
9/2/14

The Department of Transportation (DOT) has rejected an attempt from Norwegian Airlines to expedite approval of its bid to gain access to airports in the U.S.

The decision is a set back for Norwegian Air’s bid to access airports covered under the U.S. and European Union’s “Open Skies” agreement.

The company had been seeking an exemption that allows foreign carriers who qualify for the Open Skies agreement to begin providing flights to the U.S. while their full applications are still being review by federal regulators.

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The Norwegian Air bid has been controversial because the company plans to register its airplanes in Ireland, which is a member of the EU, instead of its own home country, which is not.

The transportation department is dismissing the Norwegian Air request for expedited approval, but not throwing out its application for U.S. access completely.

“The department typically reserves its exemption powers in awarding foreign air carrier authority to situations where the circumstances of a case are sufficiently clear-cut to permit acting, at least for a limited term, without the additional procedural protections of show-cause procedures …,” the agency said in a ruling that was published on Tuesday.

“Because of the extensive record, which reflects the novel and complex nature of this case, however, the department does not find that a temporary exemption is appropriate or in the public interest,” the DOT ruling continued. “Accordingly, the Department is dismissing NAI’s request for an exemption while it continues to process the applicant’s permit application.”

The exemption would have enabled Norwegian Air to begin operating flights to the U.S. while its underlying application with the Federal Aviation Administration (FAA) was being considered, if it had been approved.

Norwegian Air said Tuesday that the transportation department’s decision to dismiss its bid for expedited approval “simply gives DOT additional time to consider NAI’s permit application.

“While we think it is unfortunate that DOT feels the need to further delay issuance of our permit, which has been pending now for over six months, Norwegian Air International stands behind its business – from its pilots and cabin crew to its affordable fare model to its desire to bring competition to the transatlantic market – and looks forward to receiving approval to operate without further delay,” Norwegian Air CEO Asgeir Nyseth said in a statement.  

The transportation department had been required to make a decision on Norwegian Air’s bid for an exemption to the normal Open Skies application process by Aug. 31. The agency issued the ruling on Tuesday because the deadline fell on a Sunday that was followed by a federal holiday.

The bid by Norwegian Airlines to gain entry into the U.S. and European Union markets has roiled the aviation industry for months.

The airline has argued that critics are unfairly criticizing its business practices because they are trying to protect their current positions in the international flight markets.

Labor groups that represent U.S. airline employees have said Norwegian’s inclusion in the Open Skies Act would undermine the entire premise of the pact.

The transportation department’s decision on Tuesday does not settle the dispute entirely.

The agency will still have to rule on Norwegian Air’s full application for Open Skies consideration.

The DOT declined to issue a firm deadline for its final ruling on Tuesday.

“A tentative decision on the permit application will be issued after the department completes its review of the record and its deliberations regarding the application,” the agency said.

The Scandinavian company says it will be able to offer transatlantic flights for as low as $150 each way if its effort is approved by federal regulators.

Labor groups have raised questions about the safety of the would-be cheaper international flights, arguing that it would be difficult for Irish officials to inspect Norwegian Air’s planes because they company would not fly to the country it is planning to register its fleet with.

“NAI is effectively demanding one set of rules for its airline and a different set of rules for all other airlines in the U.S. and Europe,” AFL-CIO Transportation Trades Department President Ed Wytkind said in a statement after the transportation department’s ruling was issued.

“This scheme should not fly,” Wytkind continued. “Today’s denial by our government of NAI’s exemption should lead to a rejection of the airline’s pending application for a foreign air carrier permit.”

http://thehill.com/policy/transportation/216434-feds-dismiss-norwegian-air-bid-for-expedited-us-flight-approval#ixzz3CHXbCcx6

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