Transport Commissioner Violeta Bulc wrote to US transport secretary Anthony Foxx yesterday confirming that following consultation with EU member states, the commission is taking the unprecedented step of triggering arbitration.
The process relates to Norwegian Air’s Irish subsidiary, Norwegian Air International (NAI), which applied to the US authorities for a foreign carrier permit in 2013 to operate a Cork Boston route this year, and a Cork New York route next year. It has also flagged the possibility of US routes from Shannon.
But its application has faced stiff opposition from unions on both sides of the Atlantic, which have claimed NAI will undermine wages and working conditions.
While the US Department of Transportation (SoT) granted tentative approval for the licence in April,with three weeks for submissions, a final decision is still awaited. The arbitration is not linked to the low-fares giant’s British subsidiary, NAUK, which had its application for a foreign carrier permit delayed by US authorities last month.
A senior EU source said the Commission, and the EU member states, share the view that the failure of the US DoT to act on NAI’s 2013 permit request constitutes a breach of the EU-US Air Transport Agreement.
“The Commission informed the US authorities of its view in November 2014 and regrets that no suitable solution could be found despite intensive discussions at all levels,” the source said.
“The Commission acted in good faith during this process and still invites the US authorities to comply with the EU-US Air Transport Agreement in order to reach an amicable solution.”
A spokesman for Norwegian said they were pleased with the move to arbitration.
It is expected that the arbitration process will get underway within weeks, and could take several months.
However, the decision to trigger arbitration could compel the US authorities to make a decision sooner.