Currently, Brazil has signed open skies agreements with Bahrain, Canada, Qatar, Chile, Singapore, South Korea, Costa Rica, United Arab Emirates, Ethiopia, Ghana, Hong Kong, Iceland, Jamaica, Mexico, Oman, Kenya and Zimbabwe. “Open skies agreements have been higher and have improved competition, which has increased benefits for consumers and have a positive impact on economic growth,” the airline said in a statement. The agreement removes all reciprocity restrictions or conditions for flights between the United States and Brazil, but does not allow airlines to fly under ninth freedom or domestic flights within foreign territory. The key factor in the new regulation is the ability of air carriers to sell local currency fares, tax exemptions for the importation of flight equipment and spare parts, the ability to hire and maintain local staff, and the creation and use of a ramp crew. A long-awaited “open skies” agreement between the United States and Brazil has entered into force, the U.S. Department of Transportation (DOT) confirms to FlightGlobal. “We congratulate Minister Pompeo, Secretary Chao and their teams for their leadership and commitment to this agreement.” In the case of Brazil, the agreement authorizes the exploitation of traffic rights up to the 6th freedom of air. Other countries may also express reservations about certain articles of the agreement. While an open-air agreement was first signed in March 2011, it took years to be ratified and was only approved by the Brazilian Congress in the last six months before being signed by Brazilian President Michel Temer. As has already been negotiated, the agreement will gradually increase the number of flights. As a result of these negotiations, the Brazil-U.S.
market is trending towards significant growth. With regard to Brazil in particular, bilateral agreements were signed in 2011, which aim to increase air frequencies between the main economic blocs, in particular with the United States and the European Union. Brazil, for example, which previously had access to 15 European Union countries, will have access to 27 EU member states after the ratification of the “open skies” agreement by the National Congress. This means that the agreement will allow airlines in Brazil and the EU to freely determine the number of flights they wish to fly, as well as the countries and cities they wish to serve, as well as the fares they wish to apply. In addition, the “open skies” agreement paves the way for foreign investment in local airlines, so that foreign capital can obtain more capital for Brazilian companies. This is one of the steps that blocked the American Airlines Joint Venture Agreement – LATAM, which will allow both companies to offer a seamless travel experience across the common network. The Fort Worth-based airline is not the only airline to benefit from the regulatory change. Both Azul Brazilian Airlines and GOL have acquired stakes from U.S. airlines, and Open Skies will allow Delta, which owns 9.45% of GOL Airlines, and United, which owns 8% of Azul, to move forward in joint venture agreements similar to American`s.