Aerospace body the ADS says the UK should stay in EU during transition period
ADS is the premier trade organisation for companies in the UK aerospace and defence sector. It has said the UK must remain an EU member during a Brexit transition period from March 2019. ADS said the UK would struggle to sign the necessary agreements with global safety regulators before then, risking disruption to air travel. The government has indicated an “implementation period” may be needed to avoid an abrupt exit from the EU. But it has yet to outline what that could involve. When or if the UK ceases to be an EU member, it needs to have in place a whole new set of international agreements with, for instance, countries like the US, with Canada and emerging major markets like China, India, Japan. The industry needs a transition period and that the UK remains an EU member. Such agreements are needed, even if the UK chooses to remain a part of the European Aviation Safety Agency (EASA), which has largely replaced domestic air safety regimes in EU member states over the past 15 years. ADS was not aware that the UK government had started “detailed work” on these relationships. If the UK leaves the EU without these in place, it would mean “chaos, because we don’t have a system to ensure that our products are safe and secure to fly”. Remaining part of EASA could prove controversial as the UK would have to pay, and would be subject to European oversight, ultimately by the European Court of Justice.
Aerospace body: UK should stay in EU during transition
By Helen Thomas (Newsnight business editor – BBC)
28 July 2017
The UK must remain an EU member during a transition period from March 2019, according to the head of aerospace body ADS.
[ADS says it is the Premier Trade Organisation for companies in the UK Aerospace, Defence, Security and Space Sectors. Membership is made up of over 1000 UK registered businesses. ]
Paul Everitt said the UK would struggle to sign the necessary agreements with global safety regulators before then, risking disruption to air travel.
The government has indicated an “implementation period” may be needed to avoid an abrupt exit from the EU. But it has yet to outline what that could involve.
Mr Everitt, chief executive of ADS, told BBC Newsnight: “When we cease to be an EU member we need to have in place a whole new set of international agreements with, for instance, countries like the US, with Canada and emerging major markets like China, India, Japan.
“So for us the transition period is important and it’s important that during that period we remain an EU member.”
Such agreements are needed, he said, even if the UK chooses to remain a part of the European Aviation Safety Agency (EASA), which has largely replaced domestic air safety regimes in EU member states over the past 15 years.
Mr Everitt added that ADS was not aware that the UK government had started “detailed work” on these relationships. He said leaving the EU without these in place would mean “chaos, because we don’t have a system to ensure that our products are safe and secure to fly”.
EASA certifies aircraft for use, oversees approved aviation and maintenance operations, and develops regulations for the entire sector.
The aerospace industry, which employs about 120,000 people in the UK and generates about £28 billion worth of exports, is keen to avoid regulatory divergence which would require double certification of aircraft parts and components.
“We are very clear that we wish to remain a member of the European Aviation Safety Agency,” said Mr Everitt. “And we don’t believe that there is a viable alternative that can be up and running in a reasonable period of time.”
ADS represents the aerospace, defence, security and space sectors. It estimates that it could take five to 10 years, and an extra 300 staff, to equip the UK’s Civil Aviation Authority to take over EASA’s responsibilities.
Remaining part of EASA could prove controversial. The UK would likely be required to make financial contributions to the agency, as well subjecting the UK’s safety regime to European oversight, ultimately by the European Court of Justice.
Some countries outside the EU, like Norway and Switzerland, have associate membership of EASA.
But these countries, said Mr Everitt, have bilateral agreements with the US and others which provide “the meshing of both the regulatory regime and the international relationships. That’s what we need to have.”
“It’s really about providing our international colleagues, particularly the US, with confidence that the new regulatory regime that we are going to operate is capable of meeting the high safety and security standards that they require. “The challenge is we don’t know what that is going to look like,” he added.
Aviation experts told Newsnight that the work required to sign such agreements should not be technically complex, provided the UK is committed to remaining aligned with EASA rules.
But it could still take an estimated 18 months to get the required paperwork in place before the UK’s departure from the EU.
In a speech in June the head of the US Federal Aviation Authority, Michael Huerta, said it had started discussions with the UK government about “various scenarios” around Brexit. But he added that those discussions were “complicated and time-consuming by their very nature”.
He warned: “It is important to keep these time constraints in mind, and to not get sidetracked into a uncomfortable situation in which a missed deadline results in an interruption of service.”
The questions about safety regulation after Brexit are the latest to hit the aviation industry.
Michael O’Leary, the boss of Ryanair, has repeatedly warned that the UK is running out of time to agree a new Open Skies agreement with the EU, which allows airlines to fly freely.
Airlines sell seats up to a year in advance and Mr O’Leary has said there is a “real prospect” that there will be no flights between the UK and Europe for a period beyond March 2019.
Other airlines, however, believe both UK and European governments are highly motivated to sign a new air traffic agreement given the possible disruption and the mutual benefits of trade and tourism.
Discussions are “complicated and time-consuming” says the head of the FAA Michael Huerta
Air safety is, if anything, more complicated because it involves regulators beyond the 27 European Union countries.
“It’s not impossible for the government to allocate sufficient resources and for our European partners and worldwide partners to get up to speed. But I have to say to date… that level of urgency does not appear to be around,” said Mr Everitt.
“If we don’t have a transition arrangement and if we aren’t a member of the EU as part of that transitional arrangement, then we have chaos because we don’t have a system to ensure that our products are safe and secure to fly and a regime that is acknowledged around the world,” he added.
A government spokesman said: “Aviation is absolutely crucial to the UK’s economy and we are committed to getting the best deal possible for Britain. We will work closely with the international aviation community to ensure that this global industry continues to be a major success story for the UK economy.”
UK-based airlines told to move headquarters to Europe after Brexit or lose intra-European routes
The EU has warned airlines including easyJet and Ryanair that they will need to relocate their headquarters or sell off shares to European nationals, if they want to continue flying routes within continental Europe after Brexit. Executives at major airlines have been reminded during recent private meetings with EU officials that to continue to operate on routes between European airports, they must have a significant base on EU territory and that a majority of their capital shares must be EU-owned. This will mean they will need to act to restructure, with economic consequences for the UK, including a likely loss of jobs. Theresa May is due to trigger Article 50 next week. If the EU takes a tough line, it may result in the UK reciprocating with its own rules, which would leave EU-owned airlines facing equivalent choices. Some might establish their own British subsidiaries, as the demand for air travel in the UK is high and there is money to be made. EasyJet flies many routes within Europe (not from UK) and that is part of its business model. Ryanair is based in Ireland, but has some UK shareholders it will have to replace with Europeans. BA does not fly intra- European flights, and IAG is based in Spain. IAG is likely to need to disinvest shareholders in order to be majority EU-owned, and allow its other EU-registered carriers to continue to operate across Europe. The overall impacts on the UK will not be known for some time.