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Open Skies ?


Kip Powick

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OTTAWA (CP) -- Canada and the United States are launching formal talks to open up the North American air industry to more cross-border competition and potentially lower air fares.

Transport Minister Jean Lapierre anticipates modest changes under a so-called Open Skies deal he says should be concluded by spring.

Lapierre cites three likely reforms that would lower the cost of some international flights, including:

- Liberalized pricing rules that would allow foreign carriers to undercut domestic ones.

- Allowing passengers to travel from Canada to the United States and to a third country on a single flight.

- Allowing cargo carriers to drop off packages in two cities across the border, instead of the one currently permitted.

Lapierre says both countries have agreed to leave aside the thornier issue of "cabotage" -- the idea that carriers should be allowed to pick up and drop off passengers on foreign soil.

The federal cabinet gave Lapierre the go-ahead to launch into negotiations with the U.S. late last month.

Lapierre said he expects formal negotiations to start within two weeks. The countries held exploratory talks during the summer.

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