5J, Z2 Cleared for UAE landing

CAB rules ends PR code-shares to EK and EY

September 10, 2012

The Civil Aeronautics Board (CAB) concluded new Air Service Agreement (ASA) with the United Arab Emirates providing additional 14 flights to the Emirate Kingdom.

CAB Executive Director Carmelo Arcilla said UAE agreed to increase entitlements from the current 14 flights per week to 28 flights for each side between Manila Abu Dhabu, and Dubai.

Abu Dhabi has 7 entitlements being used by flag carrier Etihad and Dubai has 7 entitlements used by flag carrier Emirates to Manila, while the other 14 entitlements was solely held by flag carrier Philippine Airlines (PAL). Both airlines have code-share relationship with PAL allowing them to fly a total of 28 flights a week to Manila using Boeing 777-300ER planes.

The new ASA allowed both Emirates and Etihad 7 more flights entitlements each per week to both Dubai and Abu Dhabi, respectively, while the other new 14 entitlements are to be shared by Cebu Pacific (CEB), Air Philippines, and Zest Air for rights to Dubai and Abu Dhabi. 

The new frequencies firms up Cebu Pacific and Zest Air’s plan to mount long-haul flights to UAE next year from Manila.The remaining 14 rights is held by Philippine Airlines which it said would also be used by them next year.

Arcilla said they would likely award seven UAE entitlements to Cebu Pacific and another seven to Zest Air.

Air talks were held in Abu Dhabi in Sept. 5 and 6, amending the previous ASA's both countries last negotiated in 2009.

Also agreed in the air talks were unlimited traffic rights between points in the Philippines and the UAE, except Manila, in accordance with Executive Order 29 (EO29), otherwise known as the "Civil Aviation liberalization policy" of the Aquino administration.Under EO 29, the Third, Fourth, and Fifth Freedom of the air Rights are allowed, except Manila subject to reciprocal rights.

The two delegations agreed to confirm the designation of Emirates Airline , Etihad Airways , Air Arabia , RAK Airways and Fly Dubai as National Carrier from UAE Side, while the Philippines designated Philippine Airlines, Cebu Pacific, Zest Air and Air Philippines as National Carriers.

The agreement was signed by UAE's General Civil Aviation Authority (GCAA) Deputy Director General Omar Bin Ghaleb and Undersecretary Jose Perpetuo M. Lotilla of the Department of Transportation '&' Communications in the Philippines.

Representatives from Abu Dhabi Department of Transport, Dubai Civil Aviation Authority, Sharjah Department of Civil Aviation, Ras Al Khaimah Department of Civil Aviation, Etihad Airways, Emirates Airline, Air Arabia and RAK Airways attended the negotiations.

According to the ASA, both parties agreed for 28 weekly frequencies for each side to/from Manila, 14 of which is divided between Dubai and Abu Dhabi, Forty two (42) additional weekly frequencies for each side to/from Clark International Airport, Twenty one (21) additional weekly frequencies for each side to/from Cebu International Airport; and unlimited weekly frequencies for each side to/from other airports in the Philippines.

The designated airlines of the UAE shall have the right to exercise full fifth freedom traffic rights only up to fourteen (14) weekly frequencies between any intermediate point(s) and Diosdado Macapagal International Airport (Clark) only, and any point(s) beyond, except Japan, the USA and Canada.

The designated airlines of the Philippines shall have the right to exercise full fifth freedom traffic rights only up to fourteen (14) weekly frequencies between any intermediate point(s) and any one point in the UAE only, and any point(s) beyond, except the United Kingdom, Saudi Arabia and Kuwait.

Arcilla also said PAL may have to end its code share relationship with Emirates and Etihad next year after the latest ruling of CAB requiring them to service the route or lose entitlements to the UAE. In the application hearing of CEB, PAL promised to reintroduce Dubai and Abu Dhabi to its route network by next year in exchange for not recalling its issued entitlements.

Cebu Pacific has filed before CAB a reconsideration to its earlier order denying CEB UAE entitlements. The airline earlier requested the agency to recall PAL’s flight entitlements to the UAE as the airline stopped direct flight there. It argued that since PAL is no longer mounting direct flights, CAB should reallocate entitlements to other airlines. CAB dismissed the case adopting PAL's argument that they are still flying UAE on code-share arrangement with UAE airlines Etihad and Emirates Airlines.

Arcilla said the motion for reconsideration filed by both Cebu Pacific and PAL is still pending with the board.  PAL seeks reconsideration on CAB's order requiring it to service the route or lose entitlements.

“There is no final decision yet,” he said.

For Emirates, termination of code-share relationship with PAL is not seen to make a dent on its drive to grow the market with its new entitlements, although it will affects the plan deployment of its A380 to Manila which capacity is dependent upon PAL's right. The airline is expected to continue flying Manila twice daily without PAL.

Etihad on the other hand says that it will maintain its frequency of two daily flights from the grant of additional seven rights although hints introduction of third daily flight should CAB's earlier order be reconsidered.

Philippine Airlines is expecting deliveries of four 240 ton new generation Airbus A330-300 in 2013 for services to the Middle East and Australia. The high-gross weight (HGW) A330 variant is capable of direct flights to all parts of Saudi Arabia and to as far as Istanbul in Turkey, fully loaded according to disclosures by Airbus.

CAB will also conduct air service negotiations with the Kingdom of Saudi Arabia on Sept. 24 and 25.

Earlier talks with Singapore on Aug. 15 and 16, and Australia on Aug. 28 and 29, bogged down amidst reluctance by the Philippine panel to offer unlimited fifth freedom rights proposal by Singapore and Australia. 

“They want Fifth Freedom so they can pick up passengers in Japan, Korea and China. Our airline thinks this request is negotiated on the basis of reciprocity of balance. Australia's beyond rights apply only to New Zealand, while Singapore offers Australia and limited rights to Indonesia. We agreed however to add more frequency after all entitlements are used up,” Arcilla said.

The country also had unsettled air talks with Indonesia and Taiwan.Indonesia still maintain restrictive aviation policy while Taiwan wants additional seat entitlements to the country despite existing unused entitlements.