Budget carrier EasyJet demands EU flights certificate after Brexit

EasyJet has begun a formal procedure to obtain an air operator certificate to keep the status quo.
EasyJet has begun a formal procedure to obtain an air operator certificate to keep the status quo.PHOTO: EPA

LONDON (AFP) - British no-frills airline EasyJet said Friday (July 1) it had applied for a European Union licence to keep flying throughout the bloc even after Brexit, becoming the first carrier to activate a contingency plan.

The carrier said it had begun a formal procedure to obtain an air operator certificate (AOC) to keep the status quo after Britain's vote last week to quit the European Union cast doubts over airline routes.

"EasyJet is lobbying the UK government and the EU to ensure the continuation of a fully liberal and deregulated aviation market within the UK and Europe," it said in a statement.

"This would mean that EasyJet and all European airlines can continue to operate as they do today.

"As part of EasyJet's contingency planning before the referendum we had informal discussions with a number of European aviation regulators about the establishment of an AOC in an European country to enable easyJet to fly across Europe as we do today.

"EasyJet has now started a formal process to acquire an AOC," it said.

EasyJet stressed that it had no plans to move from Luton, which lies north of the British capital and where the airline has been based for two decades.

Britain's airline industry has soared over the last two decades under the EU's Single European Sky system, which lifted trade restrictions on EU airlines whose headquarters are located within the EU.

Unless British negotiators manage to secure preferential conditions, British airlines will lose this status once the country leaves the EU.

This will mean they no longer enjoy rights including being able to freely set airfares, and to launch any route in Europe without getting prior authorisation.

In concrete terms, passengers leaving or arriving in the United Kingdom will face new taxes, while British airlines will be slower to develop new routes.

Since the June 23 referendum, both EasyJet and British Airways owner IAG have issued profit warnings, as the pound has plunged against the euro on financial markets.

EasyJet said Monday that the surprise vote would create uncertainty in the economy and among consumers, impacting its second-half performance that ends in September.

"Britain being in Europe is the best thing for Britain," EasyJet chief executive Carolyn McCall told AFP a few months before Thursday's referendum.

"That is based on the fact that deregulation of aviation has been a fantastic benefit to consumers," she said, noting that it had reduced fares by 40 percent and increased routes by 170 percent.

Airlines are among the industries in Britain, in addition to banks, to have been left especially exposed by the shock Brexit vote.

The fall of sterling on exchange markets could lead to higher fuel and lease costs, and a likely fall in demand for flights to Europe by British travellers whose pounds aren't worth as much on the continent since the vote.

Ireland's no-frills airline Ryanair said earlier this week that it will put the brakes on new UK connections for the coming months given the uncertainty caused by the referendum.

"I don't think we'll open up many new lines in the UK for the next twelve or eighteen months, until this current uncertainty is removed," chief executive Michael O'Leary told AFP in Brussels on Tuesday.

Ryanair earns more than a quarter of its sales in Britain and is particularly at risk to turbulence from the nation's EU exit.

Based in euro-zone member Ireland, Ryanair would however be less affected by the tumbling pound.