Sir Michael Bishop, chairman of bmi british midland, today welcomed the growing consensus for reform of UK-US air services regulation. There is increasing recognition in London, Washington DC and the European Commission that the Bermuda II Treaty, which limits the provision of Heathrow-US services to just four airlines, must be dismantled.
The government must now build on this consensus by seeking urgent talks with its US partners. A regulatory system must be put in place that puts consumers first and allows all airlines able to provide trans-Atlantic services from Heathrow a fair opportunity to do so.
Speaking at a British American Business Inc breakfast in London, Sir Michael said:
“The argument for reform has just about been won. Nobody seriously believes that the Bermuda II Treaty is the limit of what we can achieve for consumers and the airline industry. It drives up fares, prevents choice and competition and stunts market growth.
“Having won the argument, the next stage is to agree a practical alternative that delivers the benefits currently blocked by the Bermuda II Treaty.”
In Brussels the European Commission has recently contacted the Department of Transport, Local Government and the Regions (DTLR) in response to a complaint against the Bermuda II Treaty that it has received from bmi. In Washington the Department of Transportation has approved a proposed alliance between bmi and United Airlines and indicated a desire to reach an open skies agreement with the UK government. In the UK there are a growing number of reports indicating that the Treasury and the Department of Trade and Industry support the replacement of Bermuda II with a liberalised system.
Sir Michael added:
“The UK government must respond to the pro-reform consensus and dump the Bermuda II Treaty in the dustbin where it belongs. It is a regulatory dinosaur that works against the interests of consumers, business and Heathrow, which is losing trans-Atlantic passengers to other airports in Europe.
Does this government really want to go down in history as the one that let Heathrow be overtaken by Paris Charles de Gaulle, Amsterdam Schiphol and Frankfurt airports? There is an opportunity to grow the Heathrow-US market and encourage greater investment and job creation by airlines and their suppliers and above all a better deal for consumers. The time for reform has arrived.”