Autumn Edition - Transport and Mobility
Road, maritime and aviation
Key elements of transport policy in Europe are developed at EU- level across all sectors: road, aviation, maritime and rail. The UK is no longer part of that process and does not benefit from the discussions around policy formation or the long-term strategy for transport. Within the UK, policy formation for all modes of transport sits entirely with the UK Government.
In this regard we can say divergence between the UK and the EU on transport policy is absolute. The policy is being developed through entirely different processes by entirely different actors.
Nonetheless, the issues faced by the EU and the UK are consistent, given the naturally cross-border nature of the industry. The level of recognition, reciprocity and the spirit of cooperation are therefore fundamental.
The divergence between the UK and the EU however has resulted in some duplication of policy and programs. As the UK left the mechanisms of the EU, they replicated them. An example of this is with the EU Emissions Trading System (EU ETS). The EU ETS is a cornerstone of the EU’s climate change policies and is the world’s first major carbon trading market and remains the largest such market in the world. It is a key tool for reducing greenhouse gas emissions in a cost-effective manner.
When the UK left the EU it also left the EU ETS and put in place its own Emissions Trading System, the UK ETS. Airlines operating in Europe are required to make payments to offset their carbon usage under the ETS, post Brexit those same airlines that operate from a point in the UK to a point in the EEA now have to manage two different systems for Emissions Trading, the EU ETS and the UK ETS. This has again added both cost and administrative burden as systems are replicated across the jurisdictions.
We must also consider the impact of market forces on the sector. Transport is an industry which requires operators to meet rules and standards across multiple jurisdictions, whether transporting goods or people. As such it must be asked to what degree there can really be divergence and what would be the benefit?
Air passenger rights
As the UK now entirely controls its own transport policy, it has the freedom to act on areas where progress at an EU level is restricted or stalled. This was particularly evident this year where the UK has made advancements in some areas, notably the question of air passenger rights. In the summer of 2022, the UK Government adopted its Air Passenger Charter, a document that details the rights of passengers when flights are delayed or cancelled, and the obligations of airlines to their passengers.
This is in marked difference to the process in the EU which has been subject to substantial delays as Member States have struggled to find common ground with the Air Passenger Rights Regulation stuck in negotiations since 2013. While the new Charter adopted by the UK follows a similar pattern, their ability to move quickly on the topic is in stark contrast to the problems faced in the EU.
This is a clear divergence as the United Kingdom now operates with different rules in this area compared to the EU Member States. It points to the opportunity that withdrawal has provided the UK in terms of setting its own policies at its own pace.
As mentioned, operators in the transport sector benefit from close cooperation between different jurisdictions as this can reduce costs and administrative burdens. The withdrawal of the UK from the EU has created great upheaval for the transport sector as many of the policies in place to facilitate the passage of people and goods through the EU are no longer applicable. This is most evident in the queues of trucks and passengers trying to enter the EU this summer, both subject to more stringent entry requirements.
Within the transport sector there is, naturally, a desire to limit the impacts and to encourage closer cooperation. This is achieved through programs of reciprocity, along with the recognition of cross-jurisdictional certification processes and standards which apply to vehicles, craft, machinery, and workers. If a company can certify or gain a license in one jurisdiction and have that recognised in another it saves time and cost in recertifying.
To date there is little evidence of such cooperation.
Following the withdrawal of the UK from the EU provision was made for the UK authorities to continue to recognise the certification processes of EU bodies, this provision expires on 31 December 2022. We have already seen requirements for airlines that will operate in the UK to recertify with the UK authorities, and the same requirement for machinery to be used on maritime vessels to be certified with UK authorities. The most recent announcement is for the rail sector and similarly requires operators to seek certification before the deadline.
This lack of recognition and reciprocity between the UK and the EU is leading to an additional cost and higher administrative burden for companies in the transport sector who are required to re-certify vehicles / craft and equipment.