Plans for cheap flights from Cork and Shannon to Boston could be grounded until next year as a dispute over the proposals between the the European Union and the United States goes to arbitration.
Irish-based Norwegian Air International originally intended to launch the Boston service from the Irish airports in April, but is waiting for US authorities to grant it a foreign carrier's permit so it can land there.
As Norwegian is licensed in the Republic, the EU-US Air Transport Agreement, the open skies treaty, obliges Washington’s department of transportation to grant the permit, but it has delayed in the face of pressure from unions and rival airlines.
Brussels has formally told the US it wants the issue to go arbitration, which could delay any decision for a further eight to nine months, pushing Norwegian's plans for Cork and Shannon into early next year.
“The arbitration will be set in motion after the summer and is then expected to take several months,” a spokesman for the European Commission’s transport directorate said.
He added that it was still open to the US to grant the permit and the commission has asked that the department of transportation do so. “We still hope that it won’t come to arbitration,” he said.
This will be the first time that anyone has used the arbitration clause in the air transport agreement.
The airline welcomed the news on Wednesday. “Norwegian Air International is an approved and fully operational EU carrier that meets all requirements under the open skies agreement between the EU and the US,” said its spokesman.
The Irish airline’s parent, Norwegian Air Shuttle, established it in the Republic so it would benefit from the air transport agreement, which allows EU airlines full access to the US.
Norwegian wants to launch a Ryanair-style low-cost airline offering flights from Europe to the US and Asia using the Irish company. It planned the Cork- and Shannon-to-Boston services as part of that and intended expanding them to New York in 2017.
US opponents, including the airlines Delta, United and American, the Southwest Airline Pilots’ Association and the Air Line Pilots’ Association, say that the group is using the Republic as a flag of convenience to hire low-cost labour.
However, Norwegian says that it will employ staff under Irish law and will hire only US and EU citizens to crew its transatlantic flights.
