Last week, the Department of Transportation (DOT) made a pivotal decision and dismissed a request by Norwegian Air International (NAI) for an exemption that would have allowed it to begin trans-Atlantic service to the United States while a request for a foreign air carrier permit was still pending at DOT. The decision comes on the heels of a months-long effort by the labor movement in the U.S. and Europe, members of Congress from both side of the aisle, and major American and European airlines to point out just how damaging NAI’s business plan would be. TTD’s president, Ed Wytkind, lauded the DOT’s decision as both “sound” and reflective of “the overwhelming body of evidence against NAI’s proposed rogue operation.”
Readers of MoveAmerica know the story by now: NAI is a Norwegian air carrier, but the company plans to base in Ireland – despite having no intention of flying into or out of Ireland – and its employees will be based in Bangkok and hired through a Singaporean agency. The NAI spin is that moving to Ireland is necessary to gain legal rights to fly to the U.S. Not true. While Norway isn’t a member of the EU, it is a signatory of the 2010 U.S.-EU Open Skies agreement and therefore has rights to establish trans-Atlantic service under that agreement. Instead, this plan is all about forum-shopping for the cheapest labor deal and by doing so NAI is violating the very agreement that allows it to fly to the U.S. Article 17 bis of the Agreement specifically says the rights afforded in the agreement cannot be used to lower labor standards – but that is exactly what NAI is doing here. So NAI needs the Open Skies agreement to gain expanded access to the U.S. market, but only wants it to apply when it’s convenient.
In dismissing NAI’s request for an exemption, DOT noted that this case was “novel” and “complex” and that granting the request would not be “appropriate or in the public interest.” The same logic should stand for NAI’s request for a permanent foreign air carrier permit: the DOT must shut the door on an airline operating scheme that at its core is about violating our public interest laws and doing an end around the explicit employee protections embodied in the U.S.-EU aviation trade pact. The employee protections in the Open Skies agreement were added during the second stage of negotiations in 2010 in recognition that while opening aviation markets is an important priority for the economy, it must not come at the expense of middle class airline jobs.
By denying NAI’s request for exemption last week, Transportation Secretary Anthony Foxx made the correct decision. We commend his action and now urge the Administration to keep NAI’s scheme from taking off.