University of Macau / Faculty of Law

The airline industry has undergone an unprecedented crisis in the aftermath of the events of September 11th, 2001 in the United States. At that time, the U.S. federal government rapidly moved to create and implement an important rescue package to ensure the sustainability of the U.S. airlines. Contrarily, the European Commission decided to keep the existing legislations and policies regarding state aid, allowing limited support from the Member States to their national carriers. For the Commission, the U.S. state-involvement in the air industry, as well as similar developments in other countries, was bound to create distortions of competition. This situation led the EU to submit a proposal to the Council and the European Parliament for a Regulation with aims to protect the Community airlines from the unfair pricing practices of state-aided non-Community air carriers. The text, modeled after the legislation applicable in the field of trade of goods, would fill a "legal void" and be a new efficient legislative tool for the Commission. Questions did arise, however, about its political legitimacy as well as its legal basis.

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