A hard Brexit will have potential implications in several areas:
The UK will no longer benefit from its current traffic rights as it will no longer be part of the internal EU market for air services. UK and EU licensed airlines would lose the automatic right to operate air services between the UK and the EU without seeking advance permission.
To have access to the EU market, the UK will need to negotiate new agreements with Member States and also with third countries (under EU membership, 17 non-EU countries currently provide air services to the UK ) as there will not be enough time to negotiate a comprehensive Air Service Agreement with the EU.
The EU’s “no-deal” Contingency Action Plan of 19 December 2018 contains a proposal for a regulation to ensure the provision of certain air services between the UK and the EU for a temporary period (12 months). It aims only to “ensure basic connectivity” and will not replicate the advantages of EU membership (and the Single European Sky initiative).
The regulation also envisages that UK airlines will not be allowed to add new routes nor increase frequencies on currently operated routes during that same period. The capacity currently offered by UK airlines to the EU27 market will thus be frozen as of 29 March 2019 if there is no deal.
If there is no deal, UK aviation security standards will no longer be recognised by EU airports, resulting in rescreening and reducing airlines’ competitiveness.
Additional security checks for UK citizens entering the EU cannot be ruled out.
For travel after 29 March, the UK government recommends that UK travellers have at least six months left on their passports from the date of arrival in an EU Member State.
Passengers from the UK transferring through EU airports will need to be rescreened when changing flights in EU hub airports.
Air cargo will no longer be able to be transported from a UK airport to the EU without security restrictions.
The current free movement of goods principle will no longer apply and more border checks will be undertaken.
The “no-deal” Contingency Action Plan includes a proposal for a regulation to allow UK operators to transport goods into the EU for a temporary period (nine months), provided the UK confers equivalent rights on EU road haulage operators and subject to fair competition conditions.
EU Regulation 261/2004 on compensation for delayed and cancelled flights will no longer apply for flights departing from the UK.
However, for passengers departing from the UK, existing passenger rights would probably continue to apply after Brexit based on domestic law.
Ownership and control
To obtain and keep an EU 27 operating licence and benefit from intra-EU air traffic rights, air carriers need to be majority owned and effectively controlled by EU Member States and/or nationals of EU Member States. If these conditions are no longer met because of the UK leaving EU, the current operating licence would no longer be valid and third country restrictions would apply.
For example, third country operators (“TCOs”) must obtain a safety authorisation from EASA to operate within the European Common Aviation Area.
UK airlines may therefore need to consider restructuring to retain their EU carrier status.
The requirement to be majority owned and effectively controlled by EU nationals would no longer apply to UK nationals. Nationality restrictions would no longer be part of the operating licence but would be governed by a route licence. UK carriers which currently undertake air services between the UK and third countries outside the EEA already hold such a licence. For others, this would be a new requirement.
The EU Groundhandling Directive is implemented in UK law and, given the high level of competition at UK airports, the groundhandling market will probably continue to be fully liberalised. The impact of a no-deal will be limited in this area.
In the event of a no-deal, the UK will no longer be a member of the European Aviation Safety Agency (“EASA”) and no longer benefit from the common set of harmonised aviation safety rules.
This would also mean the end of the mutual recognition of aviation safety certificates and licences provided for under the EASA system. UK-issued licences and approvals will continue to be valid under UK law but will no longer be recognised by EASA on EASA Member State-registered aircraft.
Under the “no-deal” Contingency Action Plan, the EU proposed a regulation to extend the validity of certain aviation safety licences for a temporary period (nine months).
The functions currently performed by EASA in relation to approvals for UK-designed aeronautical products and approvals for third country organisations would be conferred on the Civil Aviation Authority.
UK airlines should apply for a safety authorisation from EASA for third country carriers (“Part-TCO Authorisation ”). EASA has been accepting early applications from UK air operator certificate holders for TCO Authorisations since 7 January 2019.
The EU has concluded bilateral aviation safety agreements (“BASAs”) with the United States, Canada and Brazil, which will no longer apply. The UK will need to conclude its own bilateral agreements to replace these BASAs.
If the UK also leaves the EEA, it will no longer be bound by the EU Emissions Trading Scheme (EU-ETS).
However, non-EU airlines could be subject to a similar regime imposed at international level by the International Civil Aviation Organization (ICAO).