U.S.-EU Air Transport Agreement signed April 30, 2007

U.S.-EU AirTransport Agreement signed April 30, 2007

Air Transport Agreement

THE UNITED STATES OF AMERICA (hereinafter the "United States"),

of the one part; and

THE REPUBLIC OF AUSTRIA,

THE KINGDOM OF BELGIUM,

THE REPUBLIC OF BULGARIA,

THE REPUBLIC OF CYPRUS,

THE CZECH REPUBLIC,

THE KINGDOM OF DENMARK,

THE REPUBLIC OF ESTONIA,

THE REPUBLIC OF FINLAND,

THE FRENCH REPUBLIC,

THE FEDERAL REPUBLIC OF GERMANY,

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THE HELLENIC REPUBLIC,

THE REPUBLIC OF HUNGARY,

IRELAND,

THE ITALIAN REPUBLIC,

THE REPUBLIC OF LATVIA,

THE REPUBLIC OF LITHUANIA,

THE GRAND DUCHY OF LUXEMBOURG,

MALTA,

THE KINGDOM OF THE NETHERLANDS,

THE REPUBLIC OF POLAND,

THE PORTUGUESE REPUBLIC,

ROMANIA,

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THE SLOVAK REPUBLIC,

THE REPUBLIC OF SLOVENIA,

THE KINGDOM OF SPAIN,

THE KINGDOM OF SWEDEN,

THE UNITED KINGDOM OF GREAT BRITAIN AND NORTHERN IRELAND,

being parties to the Treaty establishing the European Community and beingMember States of the

European Union (hereinafter the "Member States"),

and the EUROPEAN COMMUNITY,

of the other part ;

DESIRING to promote an international aviation system based on competitionamong airlines in the

marketplace with minimum government interference and regulation ;

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DESIRING to facilitate the expansion of international air transportopportunities, including through

the development of air transportation networks to meet the needs ofpassengers and shippers for

convenient air transportation services ;

DESIRING to make it possible for airlines to offer the traveling andshipping public competitive

prices and services in open markets;

DESIRING to have all sectors of the air transport industry, includingairline workers, benefit in a

liberalized agreement ;

DESIRING to ensure the highest degree of safety and security ininternational air transport and

reaffirming their grave concern about acts or threats against the securityof aircraft, which

jeopardize the safety of persons or property, adversely affect theoperation of air transportation, and

undermine public confidence in the safety of civil aviation ;

NOTING the Convention on International Civil Aviation, opened forsignature at Chicago on

December 7, 1944;

RECOGNISING that government subsidies may adversely affect airlinecompetition and may

jeopardize the basic objectives of this Agreement;

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AFFIRMING the importance of protecting the environment in developing andimplementing

international aviation policy;

NOTING the importance of protecting consumers, including the protectionsafforded by the

Convention for the Unification of Certain Rules for International Carriageby Air, done at

Montreal May 28, 1999 ;

INTENDING to build upon the framework of existing agreements with the goalof opening access

to markets and maximizing benefits for consumers, airlines, labor, andcommunities on both sides

of the Atlantic ;

RECOGNISING the importance of enhancing the access of their airlines toglobal capital markets

in order to strengthen competition and promote the objectives of thisAgreement ;

INTENDING to establish a precedent of global significance to promote thebenefits of liberalization

in this crucial economic sector ;

HAVE AGREED AS FOLLOWS :

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ARTICLE 1

Definitions

For the purposes of this Agreement, unless otherwise stated, the term :

1 . "Agreement" means this Agreement, its Annexes and Appendix,and any amendments thereto ;

2.

"Air transportation" means the carriage by aircraft ofpassengers, baggage, cargo, and mail,

separately or in combination, held out to the public for remuneration orhire ;

3 .

"Convention" means the Convention on International CivilAviation, opened for signature at

Chicago on December 7, 1944, and includes :

(a) any amendment that has entered into force under Article 94(a) of theConvention and has been

ratified by both the United States and the Member State or Member Statesas is relevant to the

issue in question, and

(b) any Annex or any amendment thereto adopted under Article 90 of theConvention, insofar as

such Annex or amendment is at any given time effective for both the UnitedStates and the

Member State or Member States as is relevant to the issue in question;

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4 .

"Full cost" means the cost of providing service plus areasonable charge for administrative

overhead;

5 .

"International air transportation" means air transportation thatpasses through the airspace

over the territory of more than one State ;

6 .

"Party" means either the United States or the European Communityand its Member States;

7 .

"Price" means any fare, rate or charge for the carriage ofpassengers, baggage and/or cargo

(excluding mail) in air transportation, including surface transportationin connection with

international air transportation, if applicable, charged by airlines,including their agents, and the

conditions governing the availability of such fare, rate or charge ;

8.

"Stop for non-traffic purposes" means a landing for any purposeother than taking on or

discharging passengers, baggage, cargo and/or mail in air transportation ;

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9 .

"Territory" means, for the United States, the land areas(mainland and islands), internal waters

and territorial sea under its sovereignty or jurisdiction, and, for theEuropean Community and its

Member States, the land areas (mainland and islands), internal waters andterritorial sea in which

the Treaty establishing the European Community is applied and under theconditions laid down in

that Treaty and any successor instrument; application of this Agreement toGibraltar airport is

understood to be without prejudice to the respective legal positions ofthe Kingdom of Spain and the

United Kingdom with regard to the dispute over sovereignty over theterritory in which the airport

is situated, and to the continuing suspension of Gibraltar Airport fromEuropean Community

aviation measures existing as at 18 September 2006 as between MemberStates, in accordance with

the Ministerial statement on Gibraltar Airport agreed in C6rdoba on 18September 2006 ; and

10. "User charge" means a charge imposed on airlines for theprovision of airport, airport

environmental, air navigation, or aviation security facilities or servicesincluding related services

and facilities.

ARTICLE 2

Fair and Equal Opportunity

Each Party shall allow a fair and equal opportunity for the airlines ofboth Parties to compete in

providing the international air transportation governed by this Agreement.

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ARTICLE 3

Grant of Rights

1 .

Each Party grants to the other Party the following rights for the conductof international air

transportation by the airlines of the other Party :

(a) the right to fly across its territory without landing ;

(b) the right to make stops in its territory for non-traffic purposes ;

(c) the right to perform international air transportation between pointson the following routes :

(i) for airlines of the United States (hereinafter "U .S . airlines"),from points behind the

United States via the United States and intermediate points to any pointor points in any

Member State or States and beyond; and for all-cargo service, between anyMember

State and any point or points (including in any other Member States) ;

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(ii) for airlines of the European Community and its Member States(hereinafter

"Community airlines"), from points behind the Member States viathe Member States

and intermediate points to any point or points in the United States andbeyond ; for

all-cargo service, between the United States and any point or points ;and, for

combination services, between any point or points in the United States andany point or

points in any member of the European Common Aviation Area (hereinafter

the "ECAA") as of the date of signature of this Agreement; and

(d) the rights otherwise specified in this Agreement .

2 .

Each airline may on any or all flights and at its option :

(a) operate flights in either or both directions;

(b) combine different flight numbers within one aircraft operation ;

(c) serve behind, intermediate, and beyond points and points in theterritories of the Parties in any

combination and in any order ;

(d) omit stops at any point or points ;

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serve points behind any point in its territory with or without change ofaircraft or flight

number and hold out and advertise such services to the public as throughservices ;

(g) make stopovers at any points whether within or outside the territoryof either Party ;

(h) carry transit traffic through the other Party's territory ; and

(i) combine traffic on the same aircraft regardless of where such trafficoriginates ;

without directional or geographic limitation and without loss of any rightto carry traffic otherwise

permissible under this Agreement .

3 .

The provisions of paragraph 1 of this Article shall apply subject to therequirements that :

(a) for U.S . airlines, with the exception of all-cargo services, thetransportation is part of a service

that serves the United States, and

ii

(b) for Community airlines, with the exception of (i) all-cargo servicesand (ii) combination

services between the United States and any member of the ECAA as of thedate of signature

1

of this Agreement, the transportation is part of a service that serves aMember State .

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4 .

Each Party shall allow each airline to determine the frequency andcapacity of the

international air transportation it offers based upon commercialconsiderations in the marketplace .

Consistent with this right, neither Party shall unilaterally limit thevolume of traffic, frequency or

regularity of service, or the aircraft type or types operated by theairlines of the other Party, nor

shall it require the filing of schedules, programs for charter flights, oroperational plans by airlines

of the other Party, except as may be required for customs, technical,operational, or environmental

(consistent with Article 15) reasons under uniform conditions consistentwith Article 15 of the

Convention .

5 . Any airline may perform international air transportation without anylimitation as to change,

at any point, in type or number of aircraft operated ; provided that, (a)for U.S . airlines, with the

exception of all-cargo services, the transportation is part of a servicethat serves the United States,

and (b) for Community airlines, with the exception of (i) all-cargoservices and (ii) combination

services between the United States and a member of the ECAA as of the dateof signature of this

Agreement, the transportation is part of a service that serves a MemberState .

6 . Nothing in this Agreement shall be deemed to confer on :

(a) U.S . airlines the right to take on board, in the territory of anyMember State, passengers,

baggage, cargo, or mail carried for compensation and destined for anotherpoint in the

territory of that Member State ;

(b)

7. Community airlines' access to U .S . Government procured transportationshall be governed by

Annex 3 .

ARTICLE 4

Authorization

On receipt of applications from an airline of one Party, in the form andmanner prescribed for

operating authorizations and technical permissions, the other Party shallgrant appropriate

authorizations and permissions with minimum procedural delay, provided :

(a) for a U .S . airline, substantial ownership and effective control ofthat airline are vested in the

United States, U.S. nationals, or both, and the airline is licensed as aU.S . airline and has its

principal place of business in U .S. territory ;

for a Community airline, substantial ownership and effective control ofthat airline are vested

in a Member State or States, nationals of such a state or states, or both,and the airline is

licensed as a Community airline and has its principal place of business inthe territory of the

European Community ;

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(b)

Community airlines the right to take on board, in the territory of theUnited States,

passengers, baggage, cargo, or mail carried for compensation and destinedfor another point in

the territory of the United States .

the airline is qualified to meet the conditions prescribed under the lawsand regulations

normally applied to the operation of international air transportation bythe Party considering

the application or applications ; and

(d) the provisions set forth in Article 8 (Safety) and Article 9(Security) are being maintained and

administered .

ARTICLE 5

Revocation of Authorization

1 .

Either Party may revoke, suspend or limit the operating authorizations ortechnical

permissions or otherwise suspend or limit the operations of an airline ofthe other Party where :

(a)

(b)

for a U.S . airline, substantial ownership and effective control of thatairline are not vested in

the United States, U .S . nationals, or both, or the airline is notlicensed as a U .S . airline or does

not have its principal place of business in U.S . territory ;

for a Community airline, substantial ownership and effective control ofthat airline are not

vested in a Member State or States, nationals of such a state or states,or both, or the airline is

not licensed as a Community airline or does not have its principal placeof business in the

territory of the European Community ; or

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(c) that airline has failed to comply with the laws and regulationsreferred to in Article 7

(Application of Laws) of this Agreement .

2 .

Unless immediate action is essential to prevent further noncompliance withsubparagraph 1(c)

of this Article, the rights established by this Article shall be exercisedonly after consultation with

the other Party.

3 . This Article does not limit the rights of either Party to withhold,revoke, limit or impose

conditions on the operating authorization or technical permission of anairline or airlines of the

other Party in accordance with the provisions of Article 8 (Safety) or Article9 (Security) .

ARTICLE 6

Additional Matters related to Ownership, Investment, and Control

Notwithstanding any other provision in this Agreement, the Parties shallimplement the provisions

of Annex 4 in theirdecisions under their respective laws and regulations concerning ownership,

investment and control .

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ARTICLE 7

Application of Laws

1 .

The laws and regulations of a Party relating to the admission to ordeparture from its territory

of aircraft engaged in international air navigation, or to the operationand navigation of such aircraft

while within its territory, shall be applied to the aircraft utilized bythe airlines of the other Party,

and shall be complied with by such aircraft upon entering or departingfrom or while within the

territory of the first Party .

2 .

While entering, within, or leaving the territory of one Party, the lawsand regulations

applicable within that territory relating to the admission to or departurefrom its territory of

passengers, crew or cargo on aircraft (including regulations relating toentry, clearance,

immigration, passports, customs and quarantine or, in the case of mail,postal regulations) shall be

complied with by, or on behalf of, such passengers, crew or cargo of theother Party's airlines .

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ARTICLE 8

Safety

1 .

The responsible authorities of the Parties shall recognize as valid, forthe purposes of

operating the air transportation provided for in this Agreement,certificates of airworthiness,

certificates of competency, and licenses issued or validated by each otherand still in force, provided

that the requirements for such certificates or licenses at least equal theminimum standards that may

be established pursuant to the Convention . The responsible authoritiesmay, however, refuse to

recognize as valid for purposes of flight above their own territory,certificates of competency and

licenses granted to or validated for their own nationals by such otherauthorities .

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2 .

The responsible authorities of a Party may request consultations withother responsible

authorities concerning the safety standards maintained by thoseauthorities relating to aeronautical

facilities, aircrews, aircraft, and operation of the airlines overseen bythose authorities . Such

consultations shall take place within 45 days of the request unlessotherwise agreed . If following

such consultations, the requesting responsible authorities find that thoseauthorities do not

effectively maintain and administer safety standards and requirements in theseareas that at least

equal the minimum standards that may be established pursuant to theConvention, the requesting

responsible authorities shall notify those authorities of such findingsand the steps considered

necessary to conform with these minimum standards, and those authoritiesshall take appropriate

corrective action . The requesting responsible authorities reserve theright to withhold, revoke or

limit the operating authorization or technical permission of an airline orairlines for which those

authorities provide safety oversight in the event those authorities do nottake such appropriate

corrective action within a reasonable time and to take immediate action asto such airline or airlines

if essential to prevent further noncompliance with the duty to maintainand administer the

aforementioned standards and requirements resulting in an immediate threatto flight safety .

3 .

The European Commission shall simultaneously receive all requests andnotifications under

this Article.

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4.

Nothing in this Article shall prevent the responsible authorities of theParties from conducting

safety discussions, including those relating to the routine application ofsafety standards and

requirements or to emergency situations that may arise from time to time .

ARTICLE 9

Security

1 .

In accordance with their rights and obligations under international law,the Parties reaffirm

that their obligation to each other to protect the security of civilaviation against acts of unlawful

interference forms an integral part of this Agreement . Without limitingthe generality of their rights

and obligations under international law, the Parties shall in particularact in conformity with the

following agreements : the Convention on Offenses and Certain Other ActsCommitted on Board

Aircraft, done at Tokyo September 14, 1963, the Convention for theSuppression of Unlawful

Seizure of Aircraft, done at The Hague December 16, 1970, the Conventionfor the Suppression of

Unlawful Acts against the Safety of Civil Aviation, done at MontrealSeptember 23, 1971, and the

Protocol for the Suppression of Unlawful Acts of Violence at AirportsServing International Civil

Aviation, done at Montreal February 24, 1988 .

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2 . The Parties shall provide upon request all necessary assistance toeach other to address any

threat to the security of civil aviation, including the prevention of actsof unlawful seizure of civil

aircraft and other unlawful acts against the safety of such aircraft, oftheir passengers and crew, and

of airports and air navigation facilities .

3 .

The Parties shall, in their mutual relations, act in conformity with theaviation security

standards and appropriate recommended practices established by theInternational Civil Aviation

Organization and designated as Annexes to the Convention ; they shallrequire that operators of

aircraft of their registries, operators of aircraft who have theirprincipal place of business or

permanent residence in their territory, and the operators of airports intheir territory act in

conformity with such aviation security provisions .

4 .

Each Party shall ensure that effective measures are taken within itsterritory to protect aircraft

and to inspect passengers, crew, and their baggage and carry-on items, aswell as cargo and aircraft

stores, prior to and during boarding or loading ; and that those measuresare adjusted to meet

increased threats to the security of civil aviation. Each Party agreesthat the security provisions

required by the other Party for departure from and while within theterritory of that other Party must

be observed. Each Party shall give positive consideration to any requestfrom the other Party for

special security measures to meet a particular threat .

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5 . With full regard and mutual respect for each other's sovereignty, aParty may adopt security

measures for entry into its territory . Where possible, that Party shalltake into account the security

measures already applied by the other Party and any views that the otherParty may offer . Each

Party recognizes, however, that nothing in this Article limits the abilityof a Party to refuse entry

into its territory of any flight or flights that it deems to present athreat to its security .

6 . A Party may take emergency measures including amendments to meet aspecific security

threat. Such measures shall be notified immediately to the responsibleauthorities of the other

Party .

7 .

The Parties underline the importance of working towards compatiblepractices and standards

as a means of enhancing air transport security and minimising regulatorydivergence . To this end,

the Parties shall fully utilize and develop existing channels for thediscussion of current and

proposed security measures . The Parties expect that the discussions willaddress, among other

issues, new security measures proposed or under consideration by the otherParty, including the

revision of security measures occasioned by a change in circumstances ;measures proposed by one

Party to meet the security requirements of the other Party ; possibilitiesfor the more expeditious

adjustment of standards with respect to aviation security measures ; andcompatibility of the

requirements of one Party with the legislative obligations of the otherParty. Such discussions

should serve to foster early notice and prior discussion of new securityinitiatives and requirements .

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8 .

Without prejudice to the need to take immediate action in order to protecttransportation

security, the Parties affirm that when considering security measures, aParty shall evaluate possible

adverse effects on international air transportation and, unlessconstrained by law, shall take such

factors into account when it determines what measures are necessary andappropriate to address

those security concerns .

9 .

When an incident or threat of an incident of unlawful seizure of aircraftor other unlawful acts

against the safety of passengers, crew, aircraft, airports or airnavigation facilities occurs, the Parties

shall assist each other by facilitating communications and otherappropriate measures intended to

terminate rapidly and safely such incident or threat .

10 . When a Party has reasonable grounds to believe that the other Partyhas departed from the

aviation security provisions of this Article, the responsible authoritiesof that Party may request

immediate consultations with the responsible authorities of the otherParty . Failure to reach a

satisfactory agreement within 15 days from the date of such request shallconstitute grounds to

withhold, revoke, limit, or impose conditions on the operatingauthorization and technical

permissions of an airline or airlines of that Party . When required by anemergency, a Party may

take interim action prior to the expiry of 15 days .

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11 . Separate from airport assessments undertaken to determine conformitywith the aviation

security standards and practices referred to in paragraph 3 of thisArticle, a Party may request the

cooperation of the other Party in assessing whether particular securitymeasures of that other Party

meet the requirements of the requesting Party . The responsibleauthorities of the Parties shall

coordinate in advance the airports to be assessed and the dates ofassessment and establish a

procedure to address the results of such assessments . Taking into accountthe results of the

assessments, the requesting Party may decide that security measures of anequivalent standard are

applied in the territory of the other Party in order that transferpassengers, transfer baggage, and/or

transfer cargo may be exempted from re-screening in the territory of therequesting Party . Such a

decision shall be communicated to the other Party .

ARTICLE 10

Commercial Opportunities

1 .

The airlines of each Party shall have the right to establish offices inthe territory of the other

Party for the promotion and sale of air transportation and relatedactivities .

2 . The airlines of each Party shall be entitled, in accordance with thelaws and regulations of the

other Party relating to entry, residence, and employment, to bring in andmaintain in the territory of

the other Party managerial, sales, technical, operational, and otherspecialist staff who are required

to support the provision of air transportation .

3 .(a) Without prejudice to subparagraph (b) below, each airline shallhave in relation to

groundhandling in the territory of the other Party :

(i) the right to perform its own groundhandling("self-handling") or, at its option

the right to select among competing suppliers that provide groundhandlingservices in whole

or in part where such suppliers are allowed market access on the basis ofthe laws and

regulations of each Party, and where such suppliers are present in themarket .

(b) The rights under (i) and (ii) in subparagraph (a) above shall be subjectonly to specific

constraints of available space or capacity arising from the need tomaintain safe operation of the

airport. Where such constraints preclude self-handling and where there isno effective competition

between suppliers that provide groundhandling services, all such servicesshall be available on both

an equal and an adequate basis to all airlines ; prices of such servicesshall not exceed their full cost

including a reasonable return on assets, after depreciation .

4 .

Any airline of each Party may engage in the sale of air transportation inthe territory of the

other Party directly and/or, at the airline's discretion, through itssales agents or other intermediaries

appointed by the airline . Each airline shall have the right to sell suchtransportation, and any person

shall be free to purchase such transportation, in the currency of thatterritory or in freely convertible

currencies .

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5 .

Each airline shall have the right to convert and remit from the territoryof the other Party to its

home territory and, except where inconsistent with generally applicablelaw or regulation, the

country or countries of its choice, on demand, local revenues in excess ofsums locally disbursed .

Conversion and remittance shall be permitted promptly without restrictionsor taxation in respect

thereof at the rate of exchange applicable to current transactions andremittance on the date the

carrier makes the initial application for remittance.

6.

The airlines of each Party shall be permitted to pay for local expenses,including purchases of

fuel, in the territory of the other Party in local currency. At theirdiscretion, the airlines of each

Party may pay for such expenses in the territory of the other Party infreely convertible currencies

according to local currency regulation .

7 . In operating or holding out services under the Agreement, any airlineof a Party may enter

into cooperative marketing arrangements, such as blocked-space orcode-sharing arrangements,

with :

(a) any airline or airlines of the Parties ;

(b) any airline or airlines of a third country ; and

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(c) a surface (land or maritime) transportation provider of any country;

provided that (i) all participants in such arrangements hold theappropriate authority and (ii) the

arrangements meet the conditions prescribed under the laws and regulationsnormally applied by the

Parties to the operation or holding out of international airtransportation .

8 .

The airlines of each Party shall be entitled to enter into franchising orbranding arrangements

with companies, including airlines, of either Party or third countries,provided that the airlines hold

the appropriate authority and meet the conditions prescribed under thelaws and regulations

normally applied by the Parties to such arrangements . Annex 5 shall applyto such arrangements .

9 . The airlines of each Party may enter into arrangements for theprovision of aircraft with crew

for international air transportation with :

(a) any airlines or airlines of the Parties ; and

(b) any airlines or airlines of a third country ;

provided that all participants in such arrangements hold the appropriateauthority and meet the

conditions prescribed under the laws and regulations normally applied bythe Parties to such

arrangements . Neither Party shall require an airline of either Partyproviding the aircraft to hold

traffic rights under this Agreement for the routes on which the aircraftwill be operated .

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10 . Notwithstanding any other provision of this Agreement, airlines andindirect providers of

cargo transportation of the Parties shall be permitted, withoutrestriction, to employ in connection

with international air transportation any surface transportation for cargoto or from any points in the

territories of the Parties, or in third countries, including transport toand from all airports with

customs facilities, and including, where applicable, the right totransport cargo in bond under

applicable laws and regulations . Such cargo, whether moving by surface orby air, shall have

access to airport customs processing and facilities . Airlines may electto perform their own surface

transportation or to provide it through arrangements with other surfacecarriers, including surface

transportation operated by other airlines and indirect providers of cargoair transportation . Such

intermodal cargo services may be offered at a single, through price forthe air and surface

transportation combined, provided that shippers are not misled as to thefacts concerning such

transportation .

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ARTICLE 11

Customs Duties and Charges

1 .

On arriving in the territory of one Party, aircraft operated ininternational air transportation by

the airlines of the other Party, their regular equipment, groundequipment, fuel, lubricants,

consumable technical supplies, spare parts (including engines), aircraftstores (including but not

limited to such items of food, beverages and liquor, tobacco and otherproducts destined for sale to

or use by passengers in limited quantities during flight), and other itemsintended for or used solely

in connection with the operation or servicing of aircraft engaged ininternational air transportation

shall be exempt, on the basis of reciprocity, from all importrestrictions, property taxes and capital

levies, customs duties, excise taxes, and similar fees and charges thatare (a) imposed by the

national authorities or the European Community, and (b) not based on thecost of services provided,

provided that such equipment and supplies remain on board the aircraft .

2 . There shall also be exempt, on the basis of reciprocity, from thetaxes, levies, duties, fees and

charges referred to in paragraph 1 of this Article, with the exception ofcharges based on the cost of

the service provided :

(a) aircraft stores introduced into or supplied in the territory of aParty and taken on board, within

reasonable limits, for use on outbound aircraft of an airline of the otherParty engaged in

international air transportation, even when these stores are to be used ona part of the journey

performed over the territory of the Party in which they are taken onboard;

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(b) ground equipment and spare parts (including engines) introduced intothe territory of a Party

for the servicing, maintenance, or repair of aircraft of an airline of theother Party used in

international air transportation;

(c) fuel, lubricants and consumable technical supplies introduced into orsupplied in the territory I

of a Party for use in an aircraft of an airline of the other Party engagedin international air

transportation, even when these supplies are to be used on a part of thejourney performed

over the territory of the Party in which they are taken on board ; and

(d) printed matter, as provided for by the customs legislation of eachParty, introduced into or

supplied in the territory of one Party and taken on board for use onoutbound aircraft of an

airline of the other Party engaged in international air transportation,even when these stores

are to be used on a part of the journey performed over the territory ofthe Party in which they

are taken on board .

3 .

Equipment and supplies referred to in paragraphs 1 and 2 of this Articlemay be required to be

kept under the supervision or control of the appropriate authorities.

4 .

The exemptions provided by this Article shall also be available where theairlines of one

Party have contracted with another airline, which similarly enjoys suchexemptions from the other

Party, for the loan or transfer in the territory of the other Party of theitems specified in paragraphs 1

and 2 of this Article.

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5 .

Nothing in this Agreement shall prevent either Party from imposing taxes,levies, duties, fees

or charges on goods sold other than for consumption on board to passengersduring a sector of an

air service between two points within its territory at which embarkationor disembarkation is

permitted.

6.

In the event that two or more Member States envisage applying to the fuelsupplied to aircraft

of U .S . airlines in the territories of such Member States for flightsbetween such Member States any

waiver of the exemption contained in Article 14 .1 (b) of CouncilDirective 2003/96/EC of

27 October 2003, the Joint Committee shall consider that issue, inaccordance with paragraph 4(e)

of Article 18 .

7 .

A Party may request the assistance of the other Party, on behalf of itsairline or airlines, in

securing an exemption from taxes, duties, charges and fees imposed bystate and local governments

or authorities on the goods specified in paragraphs I and 2 of thisArticle, as well as from fuel

through-put charges, in the circumstances described in this Article,except to the extent that the

charges are based on the cost of providing the service . In response tosuch a request, the other Party

shall bring the views of the requesting Party to the attention of therelevant governmental unit or

authority and urge that those views be given appropriate consideration .

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ARTICLE 12

User Charges

1 . User charges that may be imposed by the competent charging authoritiesor bodies of each

Party on the airlines of the other Party shall be just, reasonable, notunjustly discriminatory, and

equitably apportioned among categories of users . In any event, any suchuser charges shall be

assessed on the airlines of the other Party on terms not less favorablethan the most favorable terms

available to any other airline at the time the charges are assessed .

2 .

User charges imposed on the airlines of the other Party may reflect, butshall not exceed, the

full cost to the competent charging authorities or bodies of providing theappropriate airport, airport

environmental, air navigation, and aviation security facilities andservices at the airport or within

the airport system . Such charges may include a reasonable return onassets, after depreciation .

Facilities and services for which charges are made shall be provided on anefficient and economic

basis .

3 .

Each Party shall encourage consultations between the competent chargingauthorities or

bodies in its territory and the airlines using the services andfacilities, and shall encourage the

competent charging authorities or bodies and the airlines to exchange suchinformation as may be

necessary to permit an accurate review of the reasonableness of thecharges in accordance with the

principles of paragraphs I and 2 of this Article . Each Party shallencourage the competent charging

authorities to provide users with reasonable notice of any proposal forchanges in user charges to

enable users to express their views before changes are made .

USA/CE/en 3 2

4 .

Neither Party shall be held, in dispute resolution procedures pursuant toArticle 19, to be in

breach of a provision of this Article, unless (a) it fails to undertake areview of the charge or

practice that is the subject of complaint by the other Party within areasonable amount of time ;

or (b) following such a review it fails to take all steps within its powerto remedy any charge or

practice that is inconsistent with this Article .

ARTICLE 13

Pricing

1 .

Prices for air transportation services operated pursuant to this Agreementshall be established

freely and shall not be subject to approval, nor may they be required tobe filed .

2 .

Notwithstanding paragraph 1 :

(a) The introduction or continuation of a price proposed to be charged orcharged by a

U.S . airline for international air transportation between a point in oneMember State and a

point in another Member State shall be consistent with Article 1(3) ofCouncil

Regulation (EEC) 2409/92 of 23 July 1992, or a not more restrictivesuccessor regulation .

(b) Under this paragraph, the airlines of the Parties shall provideimmediate access, on request, to

information on historical, existing, and proposed prices to theresponsible authorities of the

Parties in a manner and format acceptable to those authorities .

USA/CE/en 3 3

ARTICLE 14

Government Subsidies and Support

1 . The Parties recognize that government subsidies and support mayadversely affect the fair and

equal opportunity of airlines to compete in providing the internationalair transportation governed

by this Agreement .

2 . If one Party believes that a government subsidy or support beingconsidered or provided by

the other Party for or to the airlines of that other Party would adverselyaffect or is adversely

affecting that fair and equal opportunity of the airlines of the firstParty to compete, it may submit

observations to that Party . Furthermore, it may request a meeting of theJoint Committee as

provided in Article 18, to consider the issue and develop appropriateresponses to concerns found to

be legitimate.

3 . Each Party may approach responsible governmental entities in theterritory of the other Party,

including entities at the state, provincial or local level, if it believesthat a subsidy or support being

considered or provided by such entities will have the adverse competitiveeffects referred to in

paragraph 2 . If a Party decides to make such direct contact it shallinform promptly the other Party

through diplomatic channels. It may also request a meeting of the JointCommittee .

USA/CE/en 34

4.

Issues raised under this Article could include, for example, capitalinjections,

cross-subsidization, grants, guarantees, ownership, relief or taxexemption, by any governmental

entities.

ARTICLE 15

Environment

1 .

The Parties recognize the importance of protecting the environment whendeveloping and

implementing international aviation policy. The Parties recognize that thecosts and benefits of

measures to protect the environment must be carefully weighed indeveloping international aviation

policy .

2 . When a Party is considering proposed environmental measures, it shouldevaluate possible

adverse effects on the exercise of rights contained in this Agreement,and, if such measures are

adopted, it should take appropriate steps to mitigate any such adverseeffects .

3 . When environmental measures are established, the aviationenvironmental standards adopted

by the International Civil Aviation Organization in Annexes to theConvention shall be followed

except where differences have been filed . The Parties shall apply anyenvironmental measures

affecting air services under this Agreement in accordance with Article 2and 3(4) of this Agreement .

USA/CE/en 3 5

4.

If one Party believes that a matter involving aviation environmentalprotection raises concerns

for the application or implementation of this Agreement, it may request ameeting of the Joint

Committee, as provided in Article 18, to consider the issue and developappropriate responses to

concerns found to be legitimate .

ARTICLE 16

Consumer Protection

The Parties affirm the importance of protecting consumers, and eitherParty may request a meeting

of the Joint Committee to discuss consumer protection issues that therequesting Party identifies as

significant.

ARTICLE 17

Computer Reservation Systems

1 .

Computer Reservation Systems (CRS) vendors operating in the territory ofone Party shall be

entitled to bring in, maintain, and make freely available their CRSs totravel agencies or travel

companies whose principal business is the distribution of travel-relatedproducts in the territory of

the other Party provided the CRS complies with any relevant regulatoryrequirements of the other

Party.

USA/CE/en 36

2 . Neither Party shall, in its territory, impose or permit to be imposedon the CRS vendors of the

other Party more stringent requirements with respect to CRS displays(including edit and display

parameters), operations, practices, sales, or ownership than those imposedon its own CRS vendors .

3 . Owners/Operators of CRSs of one Party that comply with the relevantregulatory

requirements of the other Party, if any, shall have the same opportunityto own CRSs within the

territory of the other Party as do owners/operators of that Party .

ARTICLE 18

The Joint Committee

1 .

A Joint Committee consisting of representatives of the Parties shall meetat least once a year

to conduct consultations relating to this Agreement and to review itsimplementation .

2 . A Party may also request a meeting of the Joint Committee to seek toresolve questions

relating to the interpretation or application of this Agreement. However,with respect to Article 20

or Annex 2, the Joint Committee may consider questions only relating tothe refusal by either

Participant to implement the commitments undertaken, and the impact ofcompetition decisions on

the application of this Agreement . Such a meeting shall begin at theearliest possible date, but not

later than 60 days from the date of receipt of the request, unlessotherwise agreed .

USA/CE/en 3 7

3 .

The Joint Committee shall review, no later than at its first annualmeeting and thereafter as

appropriate, the overall implementation of the Agreement, including anyeffects of aviation

infrastructure constraints on the exercise of rights provided for inArticle 3, the effects of security

measures taken under Article 9, the effects on the conditions ofcompetition, including in the field

of Computer Reservation Systems, and any social effects of theimplementation of the Agreement .

4 .

The Joint Committee shall also develop cooperation by:

(a) fostering expert-level exchanges on new legislative or regulatoryinitiatives and

developments, including in the fields of security, safety, theenvironment, aviation

infrastructure (including slots), and consumer protection ;

(b) considering the social effects of the Agreement as it is implementedand developing

appropriate responses to concerns found to be legitimate ;

(c) considering potential areas for the further development of theAgreement, including the

recommendation of amendments to the Agreement ;

(d) maintaining an inventory of issues regarding government subsidies orsupport raised by either

Party in the Joint Committee;

(e) making decisions, on the basis of consensus, concerning any matterswith respect to

application of paragraph 6 of Article 11 ;

USA/CE/en 3 8

(1)

(g)

developing, within one year of provisional application, approaches toregulatory

determinations with regard to airline fitness and citizenship, with thegoal of achieving

reciprocal recognition of such determinations ;

developing a common understanding of the criteria used by the Parties inmaking their

respective decisions in cases concerning airline control, to the extentconsistent with

confidentiality requirements ;

(h) fostering consultation, where appropriate, on air transport issuesdealt with in international

organizations and in relations with third countries, includingconsideration of whether to

adopt a joint approach ;

(i) taking, on the basis of consensus, the decisions to which paragraph 3of Article 1 of Annex 4

and paragraph 3 of Article 2 of Annex 4 refer .

5 . The Parties share the goal of maximizing the benefits for consumers,airlines, labor, and

communities on both sides of the Atlantic by extending this Agreement toinclude third countries.

To this end, the Joint Committee shall work to develop a proposalregarding the conditions and

procedures, including any necessary amendments to this Agreement, thatwould be required for

third countries to accede to this Agreement .

6.

The Joint Committee shall operate on the basis of consensus .

USA/CE/en 3 9

ARTICLE 19

Arbitration

I . Any dispute relating to the application or interpretation of thisAgreement, other than issues

arising under Article 20 or under Annex 2, that is not resolved by ameeting of the Joint Committee

may be referred to a person or body for decision by agreement of theParties . If the Parties do not

so agree, the dispute shall, at the request of either Party, be submittedto arbitration in accordance

with the procedures set forth below .

2 .

Unless the Parties otherwise agree, arbitration shall be by a tribunal ofthree arbitrators to be

constituted as follows :

(a) Within 20 days after the receipt of a request for arbitration, eachParty shall name one

arbitrator . Within 45 days after these two arbitrators have been named,they shall by

agreement appoint a third arbitrator, who shall act as President of thetribunal .

USA/CE/en 40

(b) If either Party fails to name an arbitrator, or if the thirdarbitrator is not appointed in

accordance with subparagraph (a) of this paragraph, either Party mayrequest the President of

the Council of the International Civil Aviation Organization to appointthe necessary

arbitrator or arbitrators within 30 days of receipt of that request . Ifthe President of the

Council of the International Civil Aviation Organization is a national ofeither the

United States or a Member State, the most senior Vice President of thatCouncil who is not

disqualified on that ground shall make the appointment .

3 .

Except as otherwise agreed, the tribunal shall determine the limits of itsjurisdiction in

accordance with this Agreement and shall establish its own proceduralrules . At the request of a

Party, the tribunal, once formed, may ask the other Party to implementinterim relief measures

pending the tribunal's final determination . At the direction of thetribunal or at the request of either

Party, a conference shall be held not later than 15 days after thetribunal is fully constituted for the

tribunal to determine the precise issues to be arbitrated and the specificprocedures to be followed .

4.

Except as otherwise agreed or as directed by the tribunal :

(a) The statement of claim shall be submitted within 30 days of the timethe tribunal is fully

constituted, and the statement of defense shall be submitted 40 daysthereafter . Any reply by

the claimant shall be submitted within 15 days of the submission of thestatement of defense .

Any reply by the respondent shall be submitted within 15 days thereafter.

USA/CE/en 4 1

(b) The tribunal shall hold a hearing at the request of either Party, ormay hold a hearing on its

own initiative, within 15 days after the last reply is filed .

5 . The tribunal shall attempt to render a written decision within 30 daysafter completion of the

hearing or, if no hearing is held, within 30 days after the last reply issubmitted . The decision of the

majority of the tribunal shall prevail .

6 .

The Parties may submit requests for clarification of the decision within10 days after it is

rendered and any clarification given shall be issued within 15 days ofsuch request.

7 .

If the tribunal determines that there has been a violation of thisAgreement and the responsible

Party does not cure the violation, or does not reach agreement with theother Party on a mutually

satisfactory resolution within 40 days after notification of thetribunal's decision, the other Party

may suspend the application of comparable benefits arising under thisAgreement until such time as

the Parties have reached agreement on a resolution of the dispute .Nothing in this paragraph shall

be construed as limiting the right of either Party to take proportionalmeasures in accordance with

international law .

USA/CE/en 42

Y .

1

8 .

The expenses of the tribunal, including the fees and expenses of thearbitrators, shall be

shared equally by the Parties . Any expenses incurred by the President ofthe Council of the

International Civil Aviation Organization, or by any Vice President of thatCouncil, in connection

with the procedures of paragraph 2(b) of this Article shall be consideredto be part of the expenses

of the tribunal .

ARTICLE 20

Competition

1 .

The Parties recognize that competition among airlines in the transatlanticmarket is important

to promote the objectives of this Agreement, and confirm that they applytheir respective

competition regimes to protect and enhance overall competition and notindividual competitors .

2 . The Parties recognize that differences may arise concerning theapplication of their respective

competition regimes to international aviation affecting the transatlanticmarket, and that competition

among airlines in that market might be fostered by minimising thosedifferences .

USA/CE/en 43

3 .

The Parties recognize that cooperation between their respectivecompetition authorities serves

to promote competition in markets and has the potential to promotecompatible regulatory results

and to minimise differences in approach with respect to their respectivecompetition reviews of

inter-carrier agreements . Consequently, the Parties shall further thiscooperation to the extent

feasible, taking into account the different responsibilities, competenciesand procedures of the

authorities, in accordance with Annex 2 .

4 . The Joint Committee shall be briefed annually on the results of thecooperation under

Annex 2 .

ARTICLE 21

Second Stage Negotiations

1 .

The Parties share the goal of continuing to open access to markets and tomaximise benefits

for consumers, airlines, labor, and communities on both sides of theAtlantic, including the

facilitation of investment so as to better reflect the realities of aglobal aviation industry, the

strengthening of the transatlantic air transportation system, and theestablishment of a framework

that will encourage other countries to open their own air services markets. The Parties shall begin

negotiations not later than 60 days after the date of provisionalapplication of this Agreement, with

the goal of developing the next stage expeditiously .

USA/CE/en 44

2 .

To that end, the agenda for the second stage negotiations shall includethe following items of

priority interest to one or both Parties :

(a) further liberalization of traffic rights ;

(b) additional foreign investment opportunities ;

(c) effect of environmental measures and infrastructure constraints on theexercise of traffic

rights ;

(d) further access to Government-financed air transportation ; and

(e) provision of aircraft with crew .

3 .

The Parties shall review their progress towards a second stage agreementno later than

18 months after the date when the negotiations are due to start inaccordance with paragraph 1 . If

no second stage agreement has been reached by the Parties within twelvemonths of the start of the

review, each Party reserves the right thereafter to suspend rightsspecified in this Agreement . Such

suspension shall take effect no sooner than the start of the InternationalAir Transport

Association (IATA) traffic season that commences no less than twelvemonths after the date on

which notice of suspension is given .

USA/CE/en 45

ARTICLE 22

Relationship to Other Agreements

i 1 .

During the period of provisional application pursuant to Article 25 ofthis Agreement, the

bilateral agreements listed in section 1 of Annex 1, shall be suspended,except to the extent

provided in section 2 of Annex 1 .

1

2 . Upon entry into force pursuant to Article 26 of this Agreement, thisAgreement shall

supersede the bilateral agreements listed in section 1 of Annex 1, exceptto the extent provided in

i section 2 of Annex 1 .

3 .

If the Parties become parties to a multilateral agreement, or endorse adecision adopted by the

International Civil Aviation Organization or another internationalorganization, that addresses

matters covered by this Agreement, they shall consult in the JointCommittee to determine whether

this Agreement should be revised to take into account such developments .

USA/CE/en 4 6

ARTICLE 23

Termination

Either Party may, at any time, give notice in writing through diplomaticchannels to the other Party

of its decision to terminate this Agreement . Such notice shall be sentsimultaneously to the

International Civil Aviation Organization . This Agreement shall terminateat midnight GMT at the

end of the International Air Transport Association (IATA) traffic seasonin effect one year

following the date of written notification of termination, unless thenotice is withdrawn by

agreement of the Parties before the end of this period.

ARTICLE 24

Registration with ICAO

This Agreement and all amendments thereto shall be registered with theInternational Civil Aviation

Organization.

USA/CE/en 4 7

ARTICLE 25

Provisional Application

Pending entry into force pursuant to Article 26 :

1) The Parties agree to apply this Agreement from 30 March 2008 .

2) Either Party may at any time give notice in writing through diplomaticchannels to the other

Party of a decision to no longer apply this Agreement . In that event,application shall cease at

midnight GMT at the end of the International Air Transport Association(IATA) traffic season

in effect one year following the date of written notification, unless thenotice is withdrawn by

agreement of the Parties before the end of this period .

ARTICLE 26

Entry into Force

This Agreement shall enter into force one month after the date of thelater note in an exchange of

diplomatic notes between the Parties confirming that all necessaryprocedures for entry into force of

this Agreement have been completed. For purposes of this exchange, the UnitedStates shall deliver

to the European Community the diplomatic note to the European Communityand its Member

States, and the European Community shall deliver to the United States thediplomatic note or notes

from the European Community and its Member States . The diplomatic note ornotes from the

European Community and its Member States shall contain communications fromeach Member

State confirming that its necessary procedures for entry into force ofthis Agreement have been

completed .

IN WITNESS WHEREOF the undersigned, being duly authorized, have signedthis Agreement .

DONE at Brussels on the twenty-fifth day of April, 2007 and at Washingtonon the thirtieth day of

April, 2007, in duplicate .

USA/CE/en 49

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wallonne, Is Region flannnde et la Region de Bruxella-Capimk .

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Vlaamae Geweal, het Wube Gewat en bet Bruniela Hoofdatedehjk Geweat .

Dime Unterachnf bindet zugleich die Deutachaprachige Gemeinachaft, dieFlamiache Gemeinachaf, die Franzdaiachc

Gemeinschaf, die Walloniache Region, die Flimiache Region and die RegionBrOnel-Hauptatadt .

Za Ceskou republiku

USA/CE/X 3

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For Ireland

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USA/CE/X 7

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Pentru Comunitatea Europeans

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USA/CF-/X 13

As provided in Article 22 of this Agreement, the following bilateralagreements between the

United States and Member States shall be suspended or superseded by thisAgreement :

a.

The Republic of Austria: Air services agreement, signed at Vienna March16, 1989 ;

amended June 14, 1995 .

b . The Kingdom of Belgium : Air transport agreement, effected by exchangeof notes at

Washington October 23, 1980 ; amended September 22 and November 12, 1986 ;

amended November 5, 1993 and January 12, 1994 .

(amendment concluded on September 5, 1995 (provisionally applied) .)

c.

The Republic of Bulgaria : Civil aviation security Agreement, signed atSofia April 24, 1991 .

d.

The Czech Republic : Air transport agreement, signed at Prague September10, 1996 ;

amended June 4, 2001 and February 14, 2002 .

USA/CE/ANNEX 1/en 1

ANNEX1

e .

The Kingdom of Denmark : Agreement relating to air transport services,effected by

exchange of notes at Washington December 16, 1944 ; amended August 6,1954;

amended June 16, 1995 .

f.

The Republic of Finland: Air transport agreement, signed at Helsinki March29, 1949; related

protocol signed May 12, 1980 ; agreement amending 1949 agreement and 1980protocol

concluded June 9, 1995 .

g.

The French Republic: Air transport agreement, signed at Washington June18, 1998 ;

amended October 10, 2000 ; amended January 22, 2002 .

K

The Federal Republic of Germany : Air transport agreement and exchanges ofnotes, signed at

Washington July 7, 1955 ; amended April 25, 1989 .

(related protocol concluded November 1, 1978 ; related agreement concludedMay 24, 1994 ;

protocol amending the 1955 agreement concluded on May 21191) ; agreementamending

the 1996 protocol concluded on October 10, 2000 (all provisionallyapplied) .)

L

The Hellenic Republic : Air transport agreement, signed at Athens July 31,1991 ; extended

until July 31, 2007 by exchange of notes of June 22 and 28, 2006 .

USA/CE/ANNEX 1/en 2

J . The Republic of Hungary : Air transport agreement and memorandum ofunderstanding,

signed at Budapest July 12, 1989; extended until July 12, 2007 by exchangeof notes of

July 11 and 20, 2006 .

k .

Ireland: Agreement relating to air transport services, effected byexchange of notes at

Washington February 3, 1945 ; amended January 25, 1988 and September 29,1989 ; amended

July 25 and September 6, 1990 .

(Memorandum of consultations, signed at Washington October 28, 1993(provisionally

applied) .)

1.

The Italian Republic: Air transport agreement, with memorandum andexchange of notes,

signed at Rome June 22, 1970; amended October 25, 1988 ; relatedmemorandum of

understanding signed September 27, 1990 ; amendment of 1970 agreement and1990 MOU

concluded November 22 and December 23, 1991 ; amendment of 1970 agreementand

1990 MOU concluded May 30 and October 21, 1997; agreement supplementingthe

1970 agreement concluded December 30, 1998 and February 2, 1999 .

(Protocol amending the 1970 agreement concluded December 6, 1999(provisionally

applied) .)

USA/CF/ANNEX 1/en 3

m. The Grand Duchy of Luxembourg: Air transport agreement, signed atLuxembourg

August 19, 1986 ; amended June 6, 1995 ; amended July 13 and 21, 1998 .

n. Malta: Air transport agreement, signed at Washington October 12, 2000.

o. The Kingdom of the Netherlands: Air transport agreement, signed atWashington April 3,

1957 ; protocol amending the 1957 agreement concluded on March 31, 1978 ;amendment

of 1978 protocol concluded June 11, 1986 ; amendment of 1957 agreementconcluded

October 13 and December 22, 1987; amendment of 1957 agreement concludedJanuary 29

and March 13, 1992 ; amendment of 1957 agreement and 1978 protocolconcluded

October 14, 1992.

p . The Republic of Poland: Air transport agreement, signed at Warsaw June16, 2001 .

q . The Portuguese Republic : Air transport agreement, signed at LisbonMay 30, 2000.

r.

Romania: Air transport agreement, signed at Washington July 15, 1998 .

s .

The Slovak Republic : Air transport agreement, signed at BratislavaJanuary 22, 2001 .

USA/CE/ANNEX 1 /en 4

t .

The Kingdom of Spain : Air transport agreement signed at Madrid February20, 1973 ; related

agreement of February 20, March 31 and April 7, 1987 ; amendment of 1973agreement

concluded May 31, 1989; amendment of 1973 agreement concluded November 27,1991 .

u.

The Kingdom of Sweden : Agreement relating to air transport services,effected by

exchange of notes at Washington December 16,1944 ; amended August 6,1954 ;

amended June 16, 1995 .

v. The United Kingdom of Great Britain and Northern Ireland : Agreementconcerning air

services, and exchange of letters, signed at Bermuda July 23, 1977 ;agreement relating to

North Atlantic air fares, concluded March 17, 1978 ; agreement amendingthe 1977 agreement,

concluded April 25, 1978 ; agreement modifying and extending the 1978agreement relating to

North Atlantic air fares, concluded November 2 and 9, 1978 ; agreementamending the 1977

agreement, concluded December 4, 1980 ; agreement amending the 1977agreement,

concluded February 20, 1985 ; agreement amending Article 7, Annex 2, andAnnex 5 of

the 1977 agreement, concluded May 25, 1989; agreement concerning amendmentsof the

1977 agreement, termination of the US/UK Arbitration Concerning HeathrowAirport User

Charges and the request for arbitration made by the United Kingdom in itsembassy's

note no . 87 of 13 October 1993 and settlement of the matters which gaverise to those

proceedings, concluded March 11, 1994 ; agreement amending the 1977agreement,

concluded March 27, 1997 .

USA/CE/ANNEX 1/en 5

Section 2

Notwithstanding section 1 of this Annex, for areas that are notencompassed within the definition of

"territory" in Article 1 of this Agreement, the agreements inparagraphs (e)

(Denmark-United States), (g) (France-United States), and (v) (UnitedKingdom-United States) of

that section shall continue to apply, according to their terms .

Section 3

Notwithstanding Article 3 of this Agreement, U.S . airlines shall not havethe right to provide

all-cargo services, that are not part of a service that serves the UnitedStates, to or from points in the

Member States, except to or from points in the Czech Republic, the FrenchRepublic,

the Federal Republic of Germany, the Grand Duchy of Luxembourg, Malta, theRepublic of Poland,

the Portuguese Republic, and the Slovak Republic .

USA/CE/ANNEX 1/en 6

(Arrangements, being provisionally applied, contained in the memorandum ofconsultations

dated September 11, 1986 ; arrangements contained in the exchange ofletters dated July 27,

1990; arrangements contained in the memorandum of consultations of March11, 1991 ;

arrangements contained in the exchange of letters dated October 6, 1994 ;arrangements

contained in the memorandum of consultations of June 5, 1995 ;arrangements contained in the

exchange of letters dated March 31 and April 3, 2000 (all provisionallyapplied) .)

Section 4

Notwithstanding any other provisions of this Agreement, this section shallapply to scheduled and

charter combination air transportation between Ireland and the UnitedStates with effect from the

beginning of IATA Winter season 2006/2007 until the end of the IATA Winterseason 2007/2008 .

Each U.S. and Community airline may operate 3 non-stop flights between the

United States and Dublin for each non-stop flight that the airlineoperates between the

United States and Shannon. This entitlement for non-stop Dublin flightsshall be based

on an average of operations over the entire three-season transitionalperiod . A flight

shall be deemed to be a non-stop Dublin, or a non-stop Shannon, flight,according to the

first point of entry into, or the last point of departure from, Ireland .

(ii) The requirement to serve Shannon in subparagraph (a)(i) of thisSection shall terminate

if any airline inaugurates scheduled or charter combination servicebetween Dublin and

the United States, in either direction, without operating at least onenon-stop flight to

Shannon for every three non-stop flights to Dublin, averaged over thetransition period.

USA/CE/ANNEX 1/en 7

4

b .

For services between the United States and Ireland, Community airlines mayserve only

Boston, New York, Chicago, Los Angeles, and 3 additional points in theUnited States, to be

notified to the United States upon selection or change . These servicesmay operate via

intermediate points in other Member States or in third countries.

c . Code sharing shall be authorized between Ireland and the United Statesonly via other points

in the European Community . Other code-share arrangements will beconsidered on the basis

of comity and reciprocity .

USA/CE/ANNEX I/en 8

Concerning

Cooperation With Respect to Competition Issues in the Air TransportationIndustry

Article 1

The cooperation as set forth in this Annex shall be implemented by theDepartment of

Transportation of the United States of America and the Commission of theEuropean Communities

(hereinafter referred to as "the Participants"), consistent withtheir respective functions in

addressing competition issues in the air transportation industry involvingthe United States and the

European Community .

Article 2

Purpose

The purpose of this cooperation is :

1 .

To enhance mutual understanding of the application by the Participants ofthe laws,

procedures and practices under their respective competition regimes toencourage competition

in the air transportation industry ;

2 .

To facilitate understanding between the Participants of the impact of airtransportation

industry developments on competition in the international aviation market;

USA/CE/ANNEX 2/en 1

ANNEX 2

f

3 .

To reduce the potential for conflicts in the Participants' application oftheir respective

competition regimes to agreements and other cooperative arrangements whichhave an impact

on the transatlantic market ; and

4 . To promote compatible regulatory approaches to agreements and othercooperative

arrangements through a better understanding of the methodologies,analytical techniques

including the definition of the relevant market(s) and analysis ofcompetitive effects, and

remedies that the Participants use in their respective independentcompetition reviews .

Article 3

Definitions

For the purpose of this Annex, the term "competition regime"means the laws, procedures and

practices that govern the Participants' exercise of their respectivefunctions in reviewing agreements

and other cooperative arrangements among airlines in the internationalmarket . For the European

Community, this includes, but is not limited to, Articles 81, 82, and 85of the Treaty Establishing

the European Community and their implementing Regulations pursuant to thesaid Treaty, as well

as any amendments thereto . For the Department of Transportation, thisincludes, but is not limited

to, sections 41308, 41309, and 41720 of Title 49 of the United StatesCode, and its implementing

Regulations and legal precedents pursuant thereto .

USA/CE/ANNEX 2/en 2

ITW M .

(1)

(3)

Article 4

Areas of Cooperation

Subject to the qualifications in subparagraphs 1(a) and 1(b) of Article 5,the types of cooperation

between the Participants shall include the following :

Meetings between representatives of the Participants, to includecompetition experts, in

principle on a semi-annual basis, for the purpose of discussingdevelopments in the air

transportation industry, competition policy matters of mutual interest,and analytical

approaches to the application of competition law to internationalaviation, particularly in the

transatlantic market . The above discussions may lead to the developmentof a better

understanding of the Participants' respective approaches to competitionissues, including

existing commonalities, and to more compatibility in those approaches, inparticular with

respect to inter-carrier agreements .

(2) Consultations at any time between the Participants, by mutualagreement or at the request of

either Participant, to discuss any matter related to this Annex, includingspecific cases .

Each Participant may, at its discretion, invite representatives of othergovernmental authorities

to participate as appropriate in any meetings or consultations heldpursuant to paragraphs I

or 2 above.

USA/CE/ANNEX 2/en 3

(4) Timely notifications of the following proceedings or matters, which inthe judgment of the

notifying Participant may have significant implications for thecompetition interests of the

other Participant:

a.

With respect to the Department of Transportation, (i) proceedings forreview of

applications for approval of agreements and other cooperative arrangementsamong

airlines involving international air transportation, in particular forantitrust immunity

involving airlines organized under the laws of the United States and theEuropean

Community, and (ii) receipt by the Department of Transportation of a jointventure

agreement pursuant to section 41720 of Title 49 of the United States Code; and

(5)

b .

With respect to the Commission of the European Communities, (i)proceedings for

review of agreements and other cooperative arrangements among airlinesinvolving

international air transportation, in particular for alliance and othercooperative

agreements involving airlines organized under the laws of the UnitedStates and the

European Community, and (ii) consideration of individual or blockexemptions from

European Union competition law ;

Notifications of the availability, and any conditions governing thatavailability, of information

and data filed with a Participant, in electronic form or otherwise, that,in the judgment of that

Participant, may have significant implications for the competitioninterests of the other

Participant; and

USA/CE/ANNEX 2/en 4

(6) Notifications of such other activities relating to air transportationcompetition policy as may

seem appropriate to the notifying Participant .

Article 5

(1)

Use and Disclosure of Information

Notwithstanding any other provision of this Annex, neither Participant isexpected to provide

information to the other Participant if disclosure of the information tothe requesting

Participant:

a .

is prohibited by the laws, regulations or practices of the Participantpossessing the

information; or

b .

would be incompatible with important interests of the Participantpossessing the

information.

(2) Each Participant shall to the extent possible maintain theconfidentiality of any information

provided to it in confidence by the other Participant under this Annex andto oppose any

application for disclosure of such information to a third party that isnot authorized by the

supplying Participant to receive the information . Each Participantintends to notify the other

Participant whenever any information proposed to be exchanged indiscussions or in any other

manner may be required to be disclosed in a public proceeding .

USA/CE/ANNEX 2 /en 5

(3) Where pursuant to this Annex a Participant provides information on aconfidential basis to the

other Participant for the purposes specified in Article 2, thatinformation should be used by

the receiving Participant only for that purpose .

Article 6

Implementation

(1) Each Participant is designating a representative to be responsible forcoordination of activities

established under this Annex .

(2) This Annex, and all activities undertaken by a Participant pursuant toit, are

a.

intended to be implemented only to the extent consistent with all laws,regulations, and

practices applicable to that Participant ; and

b.

intended to be implemented without prejudice to the Agreement between theEuropean

Communities and the Government of the United States of America Regardingthe

Application of their Competition Laws .

Concerning

U.S . Government Procured Transportation

Community airlines shall have the right to transport passengers and cargoon scheduled and charter

flights for which a U .S . Government civilian department, agency, orinstrumentality (I) obtains the

transportation for itself or in carrying out an arrangement under whichpayment is made by the

Government or payment is made from amounts provided for the use of theGovernment, or (2)

provides the transportation to or for a foreign country or internationalor other organization without

reimbursement, and that transportation is (a) between any point in theUnited States and any point

in a Member State, except - with respect to passengers only - betweenpoints for which there is a

city-pair contract fare in effect, or (b) between any two points outsidethe United States . This

paragraph shall not apply to transportation obtained or funded by theSecretary of Defense or the

Secretary of a military department .

USA/CE/ANNEX 3/en 1

Concerning

Additional Matters Related to Ownership, Investment and Control

Article 1

Ownership of Airlines of a Party

1 . Ownership by nationals of a Member State or States of the equity of aU .S . airline shall be

permitted, subject to two limitations . First, ownership by all foreignnationals of more than

25 percent of a corporation's voting equity is prohibited . Second, actualcontrol of a U .S .

airline by foreign nationals is also prohibited . Subject to the overall25 percent limitation on

foreign ownership of voting equity:

a.

ownership by nationals of a Member State or States of :

(1) as much as 25 percent of the voting equity ; and/or

(2) as much as 49 .9 percent of the total equity

of a U .S . airline shall not be deemed, of itself, to constitute controlof that airline ;

and

b . ownership by nationals of a Member State or States of 50 percent ormore of the total

equity of a U .S . airline shall not be presumed to constitute control ofthat airline . Such

ownership shall be considered on a case-by-case basis.

USA/CE/ANNEX 4/en 1

ANNEX4

2 . Ownership by U.S . nationals of a Community airline shall be permittedsubject to two

limitations . First, the airline must be majority owned by Member Statesand/or by nationals

of Member States. Second, the airline must be effectively controlled bysuch states and/or

such nationals .

3 .

For the purposes of paragraph (b) of Article 4 and subparagraph 1(b) ofArticle 5 of this

Agreement, a member of the ECAA as of the date of signature of this Agreementand citizens

of such a member shall be treated as a Member State and its nationals,respectively . The Joint

Committee may decide that this provision shall apply to new members of theECAA and their

citizens.

4 . Notwithstanding paragraph 2, the European Community and its MemberStates reserves the

right to limit investments by U .S . nationals in the voting equity of aCommunity airline made

after the signature of this Agreement to a level equivalent to thatallowed by the United States

for foreign nationals in U.S . airlines, provided that the exercise ofthat right is consistent with

international law .

Article 2

Ownership and Control of Third-Country Airlines

l .

Neither Party shall exercise any available rights under air servicesarrangements with a

third country to refuse, revoke, suspend or limit authorizations orpermissions for any airlines

of that third country on the grounds that substantial ownership of thatairline is vested in the

other Party, its nationals, or both .

2 .

The United States shall not exercise any available rights under airservices arrangements to

refuse, revoke, suspend or limit authorizations or permissions for anyairline of the

Principality of Liechtenstein, the Swiss Confederation, a member of theECAA as of the date

of signature of this Agreement, or any country in Africa that isimplementing an Open-Skies

air services agreement with the United States as of the date of signatureof this Agreement, on

the grounds that effective control of that airline is vested in a MemberState or States,

nationals of such a state or states, or both .

3 .

The Joint Committee may decide that neither Party shall exercise therights referred to in

paragraph 2 of this Article with respect to airlines of a specific countryor countries .

USA/CE/ANNEX 4/en 3

Article 3

Control of Airlines

The rules applicable in the European Community on ownership and control ofCommunity air

carriers are currently laid down in Article 4 of Council Regulation (EEC)No . 2407/92

of 23 July 1992 on licensing of air carriers. Under this Regulation,responsibility for granting

an Operating Licence to a Community air carrier lies with the MemberStates . Member States

apply Regulation 2407/92 in accordance with their national regulations andprocedures .

The rules applicable in the United States are currently laid down inSections 40102(a)(2),

41102 and 41103 of Title 49 of the United States Code (U .S .C .), whichrequire that licenses

for a U .S . "air carrier" issued by the Department ofTransportation, whether a certificate, an

exemption, or commuter license, to engage in "airtransportation" as a common carrier, be

held only by citizens of the United States as defined in 49 U .S.C§40102(a)(15). That section

requires that the president and two-thirds of the board of directors andother managing

officers of a corporation be U .S . citizens, that at least 75 percent ofthe voting stock be owned

by U.S . citizens, and that the corporation be under the actual control ofU .S . citizens. The

requirement must be met initially by an applicant, and continue to be metby a U .S . airline

holding a license.

3 .

The practice followed by each Party in applying its laws and regulationsis set out in the

Appendix to this Annex .

USA/CE/ANNEX 4/en 4

Anuendix to Annex 4

1 .

In the United States, citizenship determinations are necessary for all U.S . air carrier applicants

for a certificate, exemption, or commuter license . An initial applicationfor a license is filed

in a formal public docket, and processed "on the record" with filingsby the applicant and any

other interested parties. The Department of Transportation renders a finaldecision by an

Order based on the formal public record of the case, including documentsfor which

confidential treatment has been granted . A "continuing fitness"case may be handled

informally by the Department, or may be set for docketed proceduressimilar to those used for

initial applications .

2 .

The Department's determinations evolve through a variety of precedents,which reflect,

among other things, the changing nature of financial markets andinvestment structures and

DOT's willingness to consider new approaches to foreign investment thatare consistent with

U.S . law. DOT works with applicants to consider proposed forms ofinvestment and to assist

them in fashioning transactions that fully comply with U .S . citizenshiplaw, and applicants

regularly consult with DOT staff before finalising their applications . Atany time before a

formal proceeding has begun, DOT staff may discuss questions concerningcitizenship issues

or other aspects of the proposed transaction and offer suggestions, whereappropriate, as to

alternatives that would allow a proposed transaction to meet U .S .citizenship requirements .

USA/CE/ANNEX 4/APPENDIX/en 1

'1

3 .

In making both its initial and continuing citizenship and fitnessdeterminations,

DOT considers the totality of circumstances affecting the U .S . airline,and Department

precedents have permitted consideration of the nature of the aviationrelationship between the

United States and the homeland(s) of any foreign investors . In thecontext of this Agreement,

DOT would treat investments from EU nationals at least as favorably as itwould treat

investments from nationals of bilateral or multilateral Open-Skies partners.

4. In the European Union, paragraph 5 of Article 4 of Regulation 2407/92provides that the

European Commission, acting at the request of a Member State, shallexamine compliance

with the requirements of Article 4 and take a decision if necessary . Intaking such decisions

the Commission must ensure compliance with the procedural rightsrecognized as general

principles of Community law by the European Court of Justice, includingthe right of

interested parties to be heard in a timely manner .

5 . When applying its laws and regulations, each Party shall ensure thatany transaction involving

investment in one of its airlines by nationals of the other Party isafforded fair and expeditious

consideration .

USA/CE/ANNEX 4/APPENDIX/en 2

1

Concerning

Franchising and Branding

1 .

The airlines of each Party shall not be precluded from entering intofranchise or branding

arrangements, including conditions relating to brand protection andoperational matters,

provided that : they comply, in particular, with the applicable laws andregulations concerning

control ; the ability of the airline to exist outside of the franchise isnot jeopardized ; the

arrangement does not result in a foreign airline engaging in cabotageoperations ; and

applicable regulations, such as consumer protection provisions, includingthose regarding the

disclosure of the identity of the airline operating the service, arecomplied with. So long as

those requirements are met, close business relationships and cooperativearrangements

between the airlines of each Party and foreign businesses are permissible,and each of the

following individual aspects, among others, of a franchise or brandingarrangement would

not, other than in exceptional circumstances, of itself raise controlissues :

a) using and displaying a specific brand or trademark of a franchisor,including

stipulations on the geographic area in which the brand or trademark may beused ;

b) displaying on the franchisee's aircraft the colors and logo of thefranchisor's brand,

including the display of such a brand, trademark, logo or similaridentification

prominently on its aircraft and the uniforms of its personnel ;

USA/CE/ANNEX 5/en I

ANNEX5

c)

using and displaying the brand, trademark or logo on, or in conjunctionwith, the

franchisee's airport facilities and equipment;

d) maintaining customer service standards designed for marketing purposes;

e)

maintaining customer service standards designed to protect the integrityof the franchise

brand;

f)

providing for license fees on standard commercial teens;

g) providing for participation in frequent flyer programs, including theaccrual of benefits ;

and

h) providing in the franchise or branding agreement for the right of thefranchisor or

franchisee to terminate the arrangement and withdraw the brand, providedthat nationals

of the United States or the Member States remain in control of the U .S .or Community

airline, respectively.

2 .

Franchising and branding arrangements are independent of, but may coexistwith, a

code-sharing arrangement that requires that both airlines have theappropriate authority from

the Parties, as provided for in paragraph 7 of Article 10 of thisAgreement .

USA/CE/ANNEX 5/en 2

Joint Declaration

Representatives of the United States and of the European Community and itsMember States

confirmed that the Air Transport Agreement initialled in Brussels on 2March 2007 and envisioned

for signature on 30 April 2007 is to be authenticated in other languages,as provided either by

exchange of letters, before signature of the Agreement, or by decision ofthe Joint Committee, after

signature of the Agreement .

This Joint Declaration is an integral part of the Air Transport Agreement.

For the United States:

For the European Community

and its Member States ; ad referendum

[signed. John Byerly]

[signed . Daniel Calleja]

Date : 18 April 2007

Date: 18 April 2007

USA/CE/JOINT DECLARATION/en 1