A Study On The Exchange Of Traffic Rights

This thesis tries to make a systemic study on the legal issues relating to the exchange of traffic rights in the area of international air transport. Based on the study of its characteristic in view of international law, by presenting all the modes of exchange of traffic rights since the Chicago Conference 1944, this thesis extracts at first the key legal principles adhered during the course of traffic rights exchanges. Combining with the legal context of the liberalization in air transport carried out by U.S. and EU since the end of 1970s, the author analyzes the influence of Open Sky policy promoted by U.S. upon the regulation of traffic rights exchange. At the same time, taking notice of the impact brought about by WTO legal system, especially its involvement with air transport industry by virtue of GATS ANNEX ON AIR TRANSPORT SERVICE, this thesis discusses the feasibility to establish a multilateral legal platform for the exchange of traffic rights. Finally, this thesis reviews the history of China in launching the exchange of traffic rights, and evaluates, from the standpoint of law, the latest development of China to push forward the exchange of traffic rights. And then hereon this foundation, the author presents his opinions and suggestions on the legal principles shall be followed and legal issues shall be taken into account during the activities to develop the exchange of traffic rights by China.Chapter I of the thesis makes a research with the general legal issues relating to exchange of traffic rights from four aspects: the legal foundation, the style, the main contents, and its evolving history. As the emphasis of this chapter, the thesis, in light of the practice of the global community, with consideration to a series of international legal documents born after World War I, especially by help of the Chicago Convention of 1944, explores extensively the characteristic of traffic rights in light of international law. In view of the author, the doctrine of sovereignty in the airspace, as the cradle for the concept traffic rights, has been accepted as a part of customary international law. Traffic rights in its essence are an inseparable part of state sovereignty. The subject performing the exchange of traffic rights could be only the sovereign state. The airlines are only the chosen entities to carry out the decision of the states. This thesis then makes a discussion on the new legal issues brought about by 1982 United Nations Convention on the Law of Sea. Simultaneously, the thesis gives an introduction about the forms and contents of traffic rights, and makes a summary with the historical development of the legal system of traffic rights exchange.Chapter II of the thesis concludes and expatiates on the legal principles that shall be followed in the activities of traffic rights exchange. In particular, the thesis deeply analyzes the legal characteristic embodied in the Principle of Sovereignty of Airspace and the Principle of Pasta Sent Servant that shall be observed in the activities of exchange of traffic rights. Additionally, the thesis makes a research on the Principle of Bilateralism, Principle of Fairness and Equal Opportunities, Principle of Safety and Security. With regard to the particular legal principle in this field, the Principle of Substantial Ownership and Effective Control, the thesis makes a comprehensive study on its history, status in quo and foreseeable prospect.Chapter III of the thesis uses the method of historical study, introduces and analyzes the traditional bilateral modes for the exchange of traffic rights, including Chicago Standard Mode, Predetermination Mode, Bermuda I, Bermuda II, and Liberal Bilateral advocated by U.S. as the leader. The thesis summarizes the legal characteristics of every mode and evaluates their history status and influence respectively. The author pays more attention on Bermuda I and the Liberal Bilateral, which influenced the international community mostly.Chapter IV of the thesis studies the latest development of mode for the exchange of traffic rights, Open Sky Bilateral. Taking into consideration with the significant influence that has been and will be promoted by Open Sky Bilateral toward the legal system of exchange of traffic rights, the thesis has it as a single chapter for a comprehensive study. On the one hand, this thesis summarizes the growing up process and legal characteristic of the Open Sky Bilateral from the perspective of United States. Eleven characteristics of Open Sky policies are refined in this Chapter. On the other hand, the thesis makes brief and concise introduction about the three Liberation Packages adopted by European Union for the unification of Single European Sky. In Section 3 the author analyzes and present certain comments on the material influence inflicted by this mode upon the activities of exchange of traffic rights, especially pays more attention to the latest development of the Open Sky Bilateral, the Open Sky Agreement between U.S. and EU(2007). From three aspects, the thesis makes an analysis on the possible impacts this Open Sky Agreement will bring upon the legal system of exchange of traffic rights.Hereon the foundation of analyzing the advantages and disadvantages of the bilateral scheme of exchange of traffic rights that has been adopted and practiced for more then 60 years, the thesis takes notice of GATS ANNEX ON AIR TRANSPORT SERVICE which is the important indication that WTO has set foot in air transport service and built the legal foundation for WTO to get extended to the area of air transport service. The thesis makes an analysis with the contents of GATS relating to air transport service, carries out an evaluation with the feasibility to bring traffic rights into the regulation under GATS scheme. At the same time, the author discusses the adaptability of the Principle of Most Favored Nation Treatment and the Principle of National Treatment as required by WTO and GATS and the legal system of exchange of traffic rights. It's the author's opinion that the framework of WTO could be a suitable platform for the building up of a multinational system for exchange of traffic rights. However, the adaptability of WTO basic principles with air transport service is still a barrier to be overcome.Section one of Chapter VI of this thesis put forward the Conclusions in five parts.1. The Principle of Sovereignty over Airspace is the foundation guiding the exchange of traffic rights.2. Only the sovereign state could be the subject in light of international law to carry out the exchange of traffic rights.3. The bilateral treaty-based system set up for the traffic rights exchange based on 1944 Chicago Convention has been accepted for more than sixty years, the reform of which is in need now.4. The Open Sky approach is not publicly-accepted yet from the standpoint of international society. But we should never devalue its influence and impact.5. The building up of a multinational system for the exchange of traffic rights in now in progress. We should give close watch with the development.Then the author makes a review with the legal practices and gains of China in launching the exchange of traffic rights, especially makes a summary with a series of measures adopted by Chinese government in recent years and their effects on the country to put forward the exchange of traffic rights. Hereon this foundation, and by referring to the afore-said analysis of the legal characteristics and latest developments of exchange of traffic rights in globe context, the author presents his opinions and suggestions on the legal principles shall be observed and legal issues shall be taken into account by China during the activities to develop exchange of traffic rights.