Structure & Development of Air Transport: Regulation & Deregulation

This report examines the structure and development of the air transport industry, focusing on the evolution of international economic regulations and the impact of deregulation following the US Airline Deregulation Act of 1978. It discusses the role of organizations like ICAO and ECOSOC in shaping international aviation regimes, along with key events such as the formation of OPEC and the liberalization of economies in various nations. The report further analyzes the developments resulting from deregulation, including the introduction of bodies like the Civil Aeronautics Board and the Federal Aviation Administration. Finally, it explores the EU's "Horizontal Air Service Agreements" and their purpose in simplifying aviation services and fostering collaboration among stakeholders to improve the aviation economy.

STRUCTURE AND
DEVELOPMENT OF
THE AIR
TRANSPORT

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Development of international economic regulation of airlines- .................................................3
Main developments of economic deregulations since-................................................................4
EU “Horizontal Air Service Agreements” and the reason behind its introduction-....................4
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
Air transport has been one of the most significant root for the world for promoting cross
border activities (Fedorik, 2021) The report would be presenting a fully fledged picture that how
after International airline got evolved specifically after the US airline deregulation act 1978.
With this regard, the report would be presenting some key notions such as international
regulatory development for airlines, some major development took place after deregulation act
would be discussed. At the end of the report the “Horizontal Air Service Agreements” reverted
by EU will be articulated.
MAIN BODY
Development of international economic regulation of airlines-
Over the time International airline economy regulation has experienced great progress.
With the progress of time it was almost impossible for nations to keep themselves away so very
first time ICAO (International Civil Aviation Organization) came into existence. Which was
reflected from Convention on International civil aviation (1944). It was signed by 52 states and it
has been behind development of safe and peaceful so can extend the best set of services to such
transportation (Dempsey, 2021)
There was ECOSOC as a legal body to control international airline economy. It was
United Nations Economic and Social Council Chamber. It was founded in 1945 which is still
active and a mother organization of ICAO. It was offering a common platform to the world to
discuss their issues so can work on them and can sort out in order to provide better path to the
world.
Keeping this point into mind that after WW2 the world was moving to join hands and
international airline economy was also getting thrived. With this regard, it became moral and
legal duty for the world to lay down better regimes to control these notions. Then at last 4 April
1947 has been the day when UN fabricated a special body which is known as ICAO and it
controlled international aviation regimes.
In the year 1960 an event was held in Baghdad, Iraq and the main aim was to install some
regulations with respect to oil and aviation fuel. It led them to form OPEC where in 1961
January five nations made a contract. These nations were Iran, Kuwait, Venezuela, Iraq, Saudi
Arabia. They fabricated better regimes, it has been proven as one of the best step since paved the
way for better aviation operations in term of their fuel requirement fulfilment (Fedorik, 2021)

Then form 1980 to 1990s, in this duration range of nations made their economies
liberalized. In 1990-91 India and China have made some strong rules, Philippines made its
charter in 1987, 1988 Myanmar, 2001 China joined WTO etc. These all events paved the way for
the world aviation or airline industry to work with intensive efficiency and eradicate those
regulatory barriers.
In 2011 IAG, International Consolidated Airlines Group came into existence from its
British airways predecessor. Under this umbrella organization there are range of participates are
getting fortified. Then for 2030 the world is striving to fabricate better regimes in order to
achieve Millennium Development Goals (MDG).
Main developments of economic deregulations since-
It was seen that international air transport made severe growth or can be concluded that
double digit rate growth from 1945 to 1973 until the very first oil crisis was experienced by the
world. It has opened a wide window of development for international communities to work on
airlines' transportation related regulations in order to make that thrive and can surge their value
along with utter eradication of such perils (Vilà Montoya, 2022)
This crisis led US to work on different issues and the nation negotiated with some key oil
producers such as Arab nations, Egypt, Syria, Israel and this perils was sorted out. It has been
one of the best instance where the world economy had experienced great progress and made
these adverse situations favourable.
US has introduced its Airline Deregulation act 1978. The main purpose was to remove
federal control from the fares, market entry, routes etc., in order to bring some new participants
in the market. This deregulation got great development afterwards, in 1996 it was found that the
fare got hiked to 9%. It led to development of bodies such as Civil Aeronautics Board, Air
Traffic Control (ATC), Federal Aviation Administration (FAA) etc. (Říha, 2022)
EU “Horizontal Air Service Agreements” and the reason behind its introduction-
It was signed between EU and other parties. This was mainly focused by the group of nations to
make their aviation services simpler and for fulfilment of the aim they dived into this contract.
Specifically in the year 2002 the authorities of the nation came with this notion. The motive was
to provide a common platform or can be said a horizontal status to the participants to share their
ideas in order to eradicate barriers and making aviation flow smooth.

In 2008, they made it with India too. They are having such horizontal air services with
number of nations in order to make their aviation industry blossom. It is helpful for the nation to
bring different stakeholders into single umbrella and providing them better opportunities. EU is
making other nations join this agreement so can improve the aviation related economy (Vilà
Montoya, 2022)
The main aim behind introduction of this “Horizontal Air Service Agreements” was to
eradicate all obstacles form the way so can pave the way for better aviation practise in the nation.
EU has always been a very different type of constellation and it generally strives to bring better
to its people with this regard EU brought this policy.
CONCLUSION
Form the report above it can be summarized that the world has made great progress due
to international regulations of airlines. With this regard, it was also seen that how the
deregulation policy of US which was adopted in 1978 has made it bring some developments. At
the end of the report it was observed that the reasons which led EU to fabricate these regimes in
order to fetch better practises in the field of aviation.

REFERENCES
Fedorik, M., 2021. Impacts of various critical situations on aviation industry and parallel with
the COVID-19 pandemic.
Dempsey, P. S., 2021. Introduction to Aviation Law.
Fedorik, M., 2021. Impacts of various critical situations on aviation industry and parallel with
the COVID-19 pandemic.
Vilà Montoya, A., 2022. Pricing algorithms applications: implications for vertical and horizontal
agreements and compatibility with EU competition law.
Říha, M., 2022. EU ANTITRUST: HOT TOPICS & NEXT STEPS, January 24–25, 2022. The
Lawyer Quarterly, 12(2).