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EU to vote on 'open skies' reform EU to vote on 'open skies' reform
(about 2 hours later)
European Union (EU) transport ministers are due to vote on an "open skies" aviation deal with the US aimed at liberalising transatlantic air travel.European Union (EU) transport ministers are due to vote on an "open skies" aviation deal with the US aimed at liberalising transatlantic air travel.
The deal eases restrictions on travel between Europe and the US, but the UK is said to be seeking concessions.The deal eases restrictions on travel between Europe and the US, but the UK is said to be seeking concessions.
British Airways fears losing control of London's Heathrow airport if the new deal goes through.British Airways fears losing control of London's Heathrow airport if the new deal goes through.
The UK wants changes to rules curbing European investment in US airlines, and has said it may vote against the deal. The UK wants limits lifted on European investment in US airlines, and is the only EU state yet to back the deal.
Ministers are expected to vote at around midday on Thursday in Brussels.Ministers are expected to vote at around midday on Thursday in Brussels.
Reports say diplomats do expect the deal to go through despite lingering British concerns.
Tough choicesTough choices
The transatlantic airline market is worth some $18bn (£9.3bn), and the EU estimates that the "open skies" deal could add millions of passengers to transatlantic routes and bring billions of euros in economic benefits. The lucrative transatlantic airline market - worth some $18bn (£9.3bn) is at the heart of the "open skies" deal.
Securing an agreement between the US and European airlines has been a long drawn-out process, and the breakthrough was only reached weeks ago. Under the plan any EU-based airline would be allowed to fly from any city within the EU to any city in the US, and vice versa.
As part of the deal, European airlines would be allowed to make transatlantic flights from any nation, not just their home country. It would also open up Heathrow so that more airlines could land and take off from the London airport.
British Airways is keen to protect its slots at HeathrowBritish Airways is keen to protect its slots at Heathrow
But while US airlines would gain free access to European airports, EU carriers would not be allowed the same rights on domestic routes within the US.
Paul Charles of Virgin Atlantic, said the deal did not go far enough.
"It doesn't enable full liberalisation, it doesn't open up US markets so that European and British carriers can operate from one city to another - that's where the British government should be pushing things today."
Negotiating the deal was a drawn-out, four-year process, and the breakthrough was only reached weeks ago.
Among the effects of the deal would be an increase in the number of airlines using London's busy Heathrow airport.
Currently just four airlines - BA, Virgin, American Airlines and United Airlines - operate transatlantic services from Heathrow.
Ownership issue
Ownership rights, which had proved controversial in earlier rounds of talks, would also be fine-tuned.Ownership rights, which had proved controversial in earlier rounds of talks, would also be fine-tuned.
However, the UK wants guarantees that Washington would follow up the initial deal with a later one that lifts limits on European airlines investing in US rivals.However, the UK wants guarantees that Washington would follow up the initial deal with a later one that lifts limits on European airlines investing in US rivals.
The US wants to be able to limit a foreign company from owning more than 25% of an American airline's voting rights.The US wants to be able to limit a foreign company from owning more than 25% of an American airline's voting rights.
The UK is also keen to put back the implementation of the deal to March 2008, with a clause that would end the deal should the US not lift investment limits by 2010.The UK is also keen to put back the implementation of the deal to March 2008, with a clause that would end the deal should the US not lift investment limits by 2010.
Should it be approved as it stands, then the "open skies" agreement would take effect in October. Should it be approved as it stands, then the "open skies" agreement would take effect in October 2007.
British Airways and Virgin Atlantic have attacked the deal, which would see them give up prime landing and take-off slots at Heathrow, but other airlines have welcomed it.