Airline Ownership by Foreigners Delayed

The Bush administration is delaying a plan to give foreigners more say in running U.S. airlines.

The House and Senate voted earlier this year to prevent the administration from going forward with the plan.

Opponents say the administration doesn't have the constitutional right to undo a law that restricts foreign ownership of U.S. airlines to 25 percent. They also say it will undermine safety, security, national defense and U.S. jobs.

Jeffrey Shane, the Transportation Department's undersecretary for policy, said Tuesday that the Bush administration recognizes it needs to spend more time discussing it with Congress.

The Bush administration also wants to sign an aviation treaty with the European Union to liberalize commercial aviation between the U.S. and Europe.

"The Europeans have suggested in their minds that there's a linkage between a final rule and their willingness to sign a treaty," Shane said.

Shane said the administration planned to issue a final rule this month allowing more foreign control. The delay will prevent EU ministers of transport from reviewing it at their Oct. 12 meeting, he said.

The treaty would let European and U.S. airlines fly wherever they want between European cities and the U.S., and charge whatever they want.

Shane listed the benefits of the proposed treaty as "a lot more competition, a lot more variety of service in the trans-Atlantic marketplace, more destinations served more conveniently, more economic opportunity for the airlines on both sides."

Labor unions and some airlines oppose more foreign control, fearing it would damage U.S. security and cost U.S. jobs.

"I am opposed to the change because it will result in the loss of American jobs, will hurt rural and small communities and could severely jeopardize our safety and security," said Illinois Rep. Jerry Costello, ranking Democrat on the House aviation subcommittee.

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On the Net:

Transportation Department: http://www.dot.gov


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