To that end, lease terms and conditions conventionally contain an indemnification of the owner/lessor of a relevant aircraft against losses and/or claims it incurs as a result of a repossession action. A search of the United Kingdom Aircraft Mortgage Register for entries registered against relevant aircraft can be made by submitting a CAA Form CA350 (obtained from www.caa.co.uk) to the CAA. Pursuant to the Air Navigation Order 2009, the aerodrome licence-holder must ensure that the messages and signals between an aircraft and the air traffic control unit at the aerodrome are recorded, complete and preserved. 4.15 What global distribution suppliers (GDSs) operate in your jurisdiction? The CAA exercises certain licensing and other powers under EU Regulations, notably in connection with operational safety and airworthiness. A working day legally comprises 8 hours and 48 hours a week. In addition, this Title includes regulations regarding airspace and air traffic. Detailed PESTEL Analysis of Airline Industry. Source: HeinOnline subscription database. For this purpose, cross-sectional data analysis was applied, and the test was performed on Turkey. 4.5 Please provide details of the procedure, including time frames for clearance and any costs of notifications. Many pilots have left the industry over the last two years with the reduced activity seen. Civil Aviation (Access to Air Travel for Disabled Persons and Persons of Reduced Mobility) Regulations 2007 Statutory Instrument No 1895 2007. 3.3 Which courts are appropriate for aviation disputes? stamp duty) applicable to the buying and selling (i.e. There is no prohibition of vertical integration between air operators and airports. Regulation 261 establishes common rules on compensation and assistance to be given to passengers in the event of cancellation or long delay. As the airline industry continues to grow, they need to pay more attention to improve their service. Conditions of use are imposed, as well as charges. Available at: https://www.spendedge.com/casestudy/pestle-analysis-of-airline-industry (Accessed 21 June 2021). Recruiting staff into the industry quickly has been difficult. 4.16 Are there any ownership requirements pertaining to GDSs operating in your jurisdiction? These regulations cover all aspects of the airline industry, including the airlines themselves (carriers), as well as their equipment (aircraft) and pilots (airmen). The shortage post-COVID has already been seen in the recovering US market. It is very crucial to do the PESTEL analysis. To register aircraft on the United Kingdom Register of Civil Aircraft, a Form CA1 (see www.caa.co.uk) is submitted either by the owner or by the so-called charterer by demise (by virtue of a relevant loan, lease, hire or hire purchase) eligible to register in accordance with the Air Navigation Order 2009 [see Endnote 1]. The judgment provides much-needed clarity on which contractual wording covers losses resulting from the pandemic. These requirements came into force on 30 November 2019 and this registration must be renewed annually. Over the last 20 years, oil prices have proved very volatile (moving from a high of $126 in 2011 to a low of just $36 in 2016 as just one example). In a connected world, conflicts can have more far-reaching effects too. 1.1 Please list and briefly describe the principal legislation and regulatory bodies which apply to and/or regulate aviation in your jurisdiction. Much of this is related to mask-wearing, but other continuing restrictions are causing upset to passengers. UK Civil Aviation (Investigation of Military Air Accidents at Civil Aerodromes) Regulations 2005. it is to be given a purposive construction taking recitals into account; the process of interpretation includes provisions of international law incorporated into Regulation 261 by reference; and. Drone-related offences are punishable by up to five years imprisonment. Political and legal factors include government intervention on economic operations or a particular industry. Political analysis. As a general rule, an arbitrator has the same powers as any court, and an arbitral tribunals decision is binding. The proposal has made some progress with the CAA providing a written judgment in May 2020 to confirm that there would be no change to the design of flight paths in or out of the airport as a result of the new runway, which would have been an extensive process to undertake. The registration fees for such priority notices vary according to the MTOW of the subject aircraft, and are currently as follows (subject to revision annually): The relevant registration fee is applied by the CAA on a per aircraft basis. Amsterdam and Frankfurt airports have imposed similar cuts on flights. Finally, and notwithstanding the foregoing, it is important to acknowledge that Brexit has granted the UK some autonomy to apply its own rules and regulations independent of the EC. Airline Industry Legal Issues. If you are an affiliate of Harvard Law School, you are welcome to contact us at research@law.harvard.edu for additional help. The compliance to these rules and regulations is compulsory for any airline travelling to and from these countries. In Lipton & Anor v BA City Flyer Ltd [2021] EWCA Civ 454, the English Court of Appeal detailed how Regulation 261 claims will operate in the UK following Brexit. It should be noted, however, that this priority position of an aircraft mortgage is nevertheless subject to certain other in rem rights (liens) of third parties to retain or detain the relevant aircraft until a claim for payment (e.g. Fuel price: In general, fuel price always plays an important role in the world economy. Neither the EC and the European National Competition authorities (EU regulators) nor the UKs Competition & Markets Authority (CMA) have blocked airline alliances yet, which are usually considered to produce substantial efficiencies and consumer benefits, but have, often following lengthy investigations and negotiations with the parties, required commitments from the parties, to be satisfied that the alliance qualifies for exemption and, in particular, that competition is not significantly affected or eliminated. The impact of aviation on the environment has also continued to be discussed more widely this year, and has featured in cases such as the proposed Heathrow expansion. Does this depend on the value of the dispute? The relevant market may vary according to the type of passengers: premium and non-premium passengers; or time-sensitive and non-time-sensitive passengers. MACRO ENVIORNMENT: Macro environmental factors are those irrepressible external factors that affect the company's decision making process. Airport operators have also been held liable where there was a known hazard and no effective system to discover and disperse birds, leading to bird strikes. Liens in favour of maintenance organisations are widely considered to arise in common law; however, in the majority of cases the right of lien is expressed contractually and there is no requirement for improvement. The remedy is equitable and discretionary; a court will exercise considerable caution before granting it. South African Airways (B) case study (referred as "Case.an Airways" for purpose of this article) is a Harvard Business School . The UK is a party to the Chicago Convention 1944, which provides for availability, so far as practicable, of aerodromes in its territory (Article 28) and equality of conditions for use of aerodromes for international and domestic aircraft (Article 15). Although borders have largely re-opened, and there is less constant news coverage, the pandemic is not yet over. Click the linked book title to view the book's record in the HOLLIS library catalog. Note: This book is not available in the Harvard Library collections. Whatever the next restrictions are, there is unlikely to be much forthcoming government support for the industry or workers. On 2 December 2015, a provisional deal was reached by the European Parliament and Council on an EU Directive regulating the use of Passenger Name Record (PNR) data for the prevention, detection, investigation and prosecution of terrorist offences and serious crime, and was endorsed by the Civil Liberties, Justice and Home Affairs Committee on 10 December 2015. A public consultation on the effects of the expansion of Heathrow followed that decision. The CAA acts in the regulation of aviation without detailed supervision by the Government. There is also a discretion for the CAA to register an aircraft which is owned by a person not qualified under Part 1 Article 5(1) where the owner resides or has a place of business in the United Kingdom, but such aircraft must not be used for commercial air transport, public transport or aerial work (Part 1 Articles 5(2) and (3)). as a self-help remedy. Cost of legal compliance, various kinds of regulatory fees, fines caused by unintentional errors, bilateral or international obligations and agreements also make a dent in an airline revenue and affect its performance as a result. The airlines also need to keep an eye on the comfort of the passengers. They had until the end of September 2021 to apply for equivalent national UK trademark protection. Read those pages for additional information regarding the legal solutions our industry teams provide. Legacy airlines that rely on filling lucrative business and first class cabins will need to rethink pricing models. Under the Civil Aviation Act 1982, the person managing or owning an aerodrome may detain an aircraft where its operator has not paid the applicable airport charges in respect of that aircraft, or of any other aircraft, which that operator operates. A long-running commission of enquiry, chaired by Sir Howard Davies, gave its recommendation in July 2015 that a third runway be built at London Heathrow. The UK implements the relevant requirements by way of the legislation discussed below. To summarise, in order to fly a drone in the UK: 4.14 To what extent does general consumer protection legislation apply to the relationship between the airport operator and the passenger? Y[U The CAA is an independent body responsible for economic, safety and consumer protection regulation, and airspace policy. How Air Cargo is Revolutionising the Global Economy, Infrastructure For Sustainable Aviation Fuel, How the Ukraine war is affecting aviation traffic. The more usual course of action from a practical point of view is therefore to obtain a court order notwithstanding the rest. Trademarks, patents and designs are registrable with the IPO. The UK will no longer be able to exert an influence through the Single Sky Committee, but will continue to be able to participate more indirectly, such as through its involvement in standardisation bodies such as EUROCAE and ETSI. Whilst socio-cultural factors can affect the performance of an individual working alone (e.g. Considering the vast regions that many airlines operate, the business environment is often regulated by on the political atmosphere in a particular market. Further guidance on the requirements for registration of aircraft on the United Kingdom Register of Civil Aircraft is available at www.caa.co.uk. Harvard University Digital Accessibility Policy. Ad hoc funding by the UK Government for domestic flight routes is available to UK airlines where it can be demonstrated that it will boost regional links across the UK and create a positive economic impact in terms of employment and supply chain dynamics and structured as public service obligations (PSOs). The definition of qualifying aircraft was narrowed in January 2011 to bring the United Kingdom more in line with the rest of Europe. As regards the lessor of an aircraft registered with the CAA, theoretically it is permitted to take enforcement action to repossess the aircraft following a default by the lessee concerned on the relevant lease terms, without enforcing through the courts, i.e. The aviation industry also conducts advertising campaign on the social platform for attracting more clients. Users of airports are subject to airport charges, which are regulated by the CAA under the Civil Aviation Act 2012 and the Airport Charges Regulation 2011. Ensuring a smooth transaction between hosts and guests. With the implementation of the GDPR, the DPA 2018 and the PNR Directive (and the national variations), operators need to continue to review and monitor their mechanisms, processes and procedures in place to ensure compliance with new legislative requirements around the collection and provision of data and the secure handling, retention and use of it. For the sake of completeness, it should be noted that the Bills of Sale Acts 1878 and 1882 allow seizure of an aircraft (or aviation asset) on the occurrence of certain events of default (as specified in the Acts) relating to a security bill of sale. Broadly, the DPA 2018 applies to the processing (such as obtaining, recording, holding, using, disclosing or erasing) of personal data. These forms of combined travel are protected as a package under the Directive; in particular, where the travel services are booked at the same time and as part of the same booking process or where they are offered for an inclusive price. In fact, the world's 20 busiest airports, alone, saw roughly 1.5 billion . They are licensed and regulated by the CAA. (d) the agreement should not eliminate effective competition. RadcliffesLeBrasseur LLP, Philip Perrotta Failing to be tech-savvy can result in loss of clients. Many of these materials are provided as searchable full-text PDFs. 'A PESTLE analysis of the aviation industry', notesmatic, [online]. The Ukraine/Russian situation is not the only threat either. Among the changes to data protection legislation implemented via the GDPR, some key points include: i) requiring freely given, specific, informed and unambiguous consent from a data subject which must be as easy to withdraw as it is to give; ii) the provision of clear and unambiguous information regarding what the data is to be used for, how long it is to be used for and the requirement to set out exactly what the data subjects rights are in relation to the personal data they provide; iii) maximum fines for breach of the GDPR are the higher of 4% of annual global turnover or 20 million; iv) requiring organisations which engage in regular and systematic monitoring of data subjects on a large scale to appoint a data protection officer (also known as a DPO); and v) the requirement for those processing personal data to be accountable and provide adequate technical and organisational measures to protect any personal data held. The government has set up some strict rules and guidelines for the operation of an airline which can ensure the utmost security of the passengers. A Harvard study suggests that more than 57% of today's youth will be obese at age 35. 2.8 Does your jurisdiction make use of any taxation benefits which enhance aircraft trading and leasing (either in-bound or out-bound leasing), for example access to an extensive network of Double Tax Treaties or similar, or favourable tax treatment on the disposal of aircraft? Fla. 2021). 4.8 What are the main regulatory instruments governing the acquisition, retention and use of passenger data, and what rights do passengers have in respect of their data which is held by airlines and airports? Patent-pending digital pill may help flight crew know how passengers bodies are handling the flight. There is a 500,000 cap on the amount of damages that can be claimed (although this can be waived if agreed by the parties). Many external factors contributed to this situation. 2.5 What (if any) are the tax implications in your jurisdiction for aircraft trading as regards a) value-added tax (VAT) and/or goods and services tax (GST), and b) documentary taxes such as stamp duty; and (to the extent applicable) do exemptions exist as regards non-domestic purchasers and sellers of aircraft and/or particular aircraft types or operations? But they also will make it harder for airlines to show profits as the squeeze is expected to push up labor costs at a time when carriers face significantly higher fuel prices. These regulations cover all aspects of the airline industry, including the airlines themselves (carriers), as well as their equipment (aircraft) and pilots (airmen). It has been a worry for the airline companies and the government at the same time. These factors include demographic, socio-cultural, economic, political-legal and also the natural factors. 3.4 What service requirements apply for the service of court proceedings, and do these differ for domestic airlines/parties and non-domestic airlines/parties? Though the number of passengers has increased over the years, most airline companies failed to see a surge in their revenue. However, UAE is the safest country in the region and it has the . For example, if there are cases of employee harassment or passenger mistreatment, those events can create a deep impact on their business. A party may appeal to the High Court on a question of law arising out of the arbitral award. Politics and the airline industry go hand in hand - from . As a Regulation, it has direct effect in each EU Member State as well as the Member States of the European Economic Area (EEA). Aviation is a well-regulated and protected industry. K&L Gates LLP, The International Comparative Legal Guides and the International Business Reports are published by: Global Legal Group, Working with GLG has been a smooth and efficient co-operation from beginning to end. AirlinesAutomotiveBlockchain TechnologyConsumer ProductsCosmeticsCryptocurrencyCybersecurityDigital ArtsDigital MarketingEcommerceEnergyFashionLuxury BrandsHealth TechnologyProfessional ServicesReal Estate DevelopersRestaurantsRetailSoftwareSporting GoodsTechnologyTelecommunications. Overweight and obesity will challenge airports and airlines in the future. Most of the countries have multiple operating airline companies, which makes it a highly competitive market. Social factors have a profound impact on businesses, as well as the overall marketplace. Getting the Deal Through is a subscription database that provides information about applicable law in several business-related practice areas for multiple jurisdictions. Most countries have some rules concerning the service. Mhlanga and Steyn (2017) found that South African Airways was ordered to pay more than 104 million Rand in. The CAA is responsible for administering air safety on a day-to-day basis, in its own capacity and for and on behalf of EASA. In particular, airlines remain subject to restrictions in aircraft operations and safety that remain outside of their control. Airlines also create social values like any other business as the consumer of today has changed. Of course, one of the major events in 2022 has been the war in Ukraine. This last aspect or the ongoing global economic slowdown has meant that the already struggling airlines now have to contend with declining passenger traffic, competition from low cost carriers, high aviation fuel prices, labor demands, and soaring maintenance and operating costs. The delay therefore occurred wholly outside the UK. However, where a merger falls outside the turnover thresholds of the EU Merger Control Regulation 139/2004, but falls within the definition of relevant merger situation within the Act (see below), the CMA will have jurisdiction to investigate it within four months of completion or the date it was made public, whichever is later (discussed below). If the CMA believes that a merger has resulted or may be expected to result in a substantial lessening of competition, and satisfactory undertakings cannot be agreed with the parties, the CMA will evaluate the competitive effects of the merger and may, where it believes the merger has or may result in a substantial lessening of competition in the UK market, refer the merger for an in-depth Phase 2 investigation. The current EU case law is limited. This section specifically discusses the US law of air transport. As in many industries, an unpredictable situation like this is very hard to manage. If the relevant mortgagor is a company registered in England and Wales, in order to obtain all the protections conventionally afforded to a mortgagee, it will be necessary to also register the relevant mortgage at Companies House pursuant to the provisions of the Companies Act 2006, as it will become void against an appointed insolvency agent of the mortgagor (whether an administrator, a liquidator or a secured creditor). EU regulators (and therefore in all likelihood the UK competition authorities at the present time) consider that the degree of competitive constraint imposed by one-stop services varies according to the route and assesses the precise impact of competing one-stop flights on the parties joint venture on a route-by-route basis. There will still be a need for movement and in-person contact, but undoubtedly less. For example, London Heathrow is owned by Heathrow Airport Holdings Limited (formerly BAA) which is owned by FGP Topco Limited, a consortium led by Ferrovial SA; Aberdeen, Glasgow and Southampton airports are owned by AGS Airports Limited which is jointly held by Ferrovial SA (via Faero UK Holding Limited) and AGS Ventures Airports Limited; Manchester Airport is owned by Manchester Airports Group plc; and London Gatwick is owned by French VINCI Airports (majority shareholder) and Global Infrastructure Partners. Data subjects, such as individual passengers, now have further rights under the GDPR, including the right to: (a) access a copy of the information comprising their personal data; (b) object to processing that is likely to cause them damage or distress; (c) prevent processing for direct marketing; (d) object to decisions being taken by automated means; (e) have inaccurate personal data rectified, blocked, released or destroyed; (f) have personal data deleted where continued processing is unnecessary (the right to be forgotten); (g) request that certain data, which is processed by automated means, is transferred to a different controller; and. One such example is a PESTEL (Political, Economic, Social, Technological, Environmental and Legal factors) framework which is discussed below. factors that impact on airline performances (Lohmann & Koo, 2013). An Important Business Analysis Tool, Twitter PESTLE Analysis: 6 Notable Factors Affecting the Social Network, How to Pursue a Career in Cybersecurity: 7 Professional Tips to Follow, General Mills SWOT Analysis: 3 Opportunities to Gain Competitive Advantage, Root Cause Analysis: An Easy 6-Step Complete Guide, Mayo Clinic SWOT Analysis 2023: Healthcare Business Checkup, 3 Top Tech Tools for the Modern Commercial Contractor. Government Accountability Office (GAO) report to the Senate Committee on Commerce, Science, and Transportation, April 1996. They can calculate the carbon footprint for being responsible to the environment. Available at: https://www.marketingtutor.net/airline-industry-pestle-analysis/ (Accessed 21 June 2021). Product transportation, profit margins, and viability of certain markets are all examples of things which may be influenced by legal factors. , . (d) it would not be in the public interest for the aircraft to be, or to continue to be, registered in the United Kingdom. Terrorism likewise remains a threat, and the risk increases with more political instability. Otherwise, this can be a massive concern in the future. In certain circumstances, these rights of detention will also include a power of sale of the relevant aircraft, or attach to the rest of the operating fleet of which the aircraft is a part despite different ownership. In general terms, there are both (for historical reasons) legal and equitable remedies, and the following may be available: 3.6 Are there any rights of appeal to the courts from the decision of a court or arbitral tribunal and, if so, in what circumstances do these rights arise? Vous pouvez modifier vos choix tout moment en cliquant sur le lien Tableau de bord sur la vie prive prsent sur nos sites et dans nos applications. Leases and other charges not constituting in rem rights in a G-registered aircraft (such as mortgages) cannot be registered, and there is no separate register maintained by the CAA for the registration of ownership rights in engines or parts. For more information on how we can assist with airline industry legal issues please contact us. Similarly, the principle for international transfers of personal data previously contained in the DPA 1998 is now dealt with separately in Chapter V of the GDPR. Alike on legal front, air transport is regulated by several laws and regulations. This Regulation establishes the rules on compensation and assistance to passengers in the event of denied boarding, long delay of flights, and cancellation. covers common issues in aviation laws and regulations - including aircraft trading, finance and leasing, litigation and dispute resolution. It applies to all the people living in the region regardless of their nationalities. It has stuck with this view post-COVID starting in July 2022 that it sees the need for up to 6,000 new pilots per year for the next 20 years just in Europe. There is not a statutory definition of a force majeure event, but these typically include provisions for issues such as the weather (flood, drought, earthquake or other natural disaster), terrorist attacks and war, governmental acts, and most fittingly for the current environment, pandemics and epidemics. Reports of civil air accidents are published. Alan D. Meneghetti There are some short waivers in place, but the impact is getting closer. The principles of financing and leasing (whether operating or finance leasing) are well established under English law and particularly in the case of clearly-drafted agreements setting out the basis for acquisition of title in an aircraft or other aviation assets. They are currently as follows (and are subject to revision annually): For aircraft mortgages which attach to a number of aircraft, the CAA registration fee is levied on the heaviest aircraft by MTOW, plus 184 for each additional aircraft attached. First and Business Class ticket passengers are less price-sensitive than Economy ticket users. The supreme court of European union has imposed compensation on emirates airlines amounting to million of pounds.