The outcome of the UK referendum on EU membership signals that
there are likely to potentially be big changes ahead for the UK
economy and the aviation and travel sector.
While March 2017 has been flagged as the date the exit process
is likely to start, the exact timelines and priorities are still
being defined. The industry is wondering how best to respond to the
growing uncertainty over its future.
Much of the debate on what the terms of exit could or should be
is taking place at a very high level. But businesses want to know
the detail on what to expect in order to plan ahead.In addition, it
is very important that the aviation and travel industry gets
involved in the debate when it comes to renegotiation.
Why might Brexit be significant for the UK and global aviation
Aviation and travel are global
industries which are influenced by international trade and
politics. Any major changes relating to regulation, trade or
politics is thus likely to have an impact on the dynamics of these
The outcome of the UK referendum has
created uncertainty over how the UK and the EU aviation sectors
will continue to operate and collaborate in a mutually beneficial
way. After the UK leaves the EU, the UK aviation sector could see
an overhaul which may require significant changes in the way it
Considerations for airlines and travel companies in relation to
Airlines and travel businesses should
adopt a sensible approach to planning which would include a
thorough analysis of the relevant risks and opportunities that are
emerging specifically for their organisation before, during and
after the exit takes place.
In this process businesses should
consider a range of different aspects, including; Economic and
Financial, Regulation, Corporate Governance and Strategy,
Operational Strategy, and the Consumer and Customer
What the industry needs to consider when planning short, medium
and long term
Short term - the
immediate effect on air traffic as well as revenues in the industry
will be governed largely by foreign exchange volatility.
Medium term - when
the terms of exit become clearer, regulatory and operational issues
could become more pertinent considerations. Airlines and travel
companies might need to take strategic decisions on the best course
of action for them, especially when addressing the likely future
inflationary pressures on the industry's cost base.
Long term -
strategies for operations, consumer protection and other regulatory
matters as well as customer relationships will have to be
With the inclusion of an electronic bills of lading clause in the latest iteration of the NYPE form, as well as the International Group of P&I Clubs' approval of 3 electronic trading systems, we discuss some of the possible advantages and disadvantages of such systems to international trade.
It is common practice for traders, usually when they are the sellers of the goods and the charterers of a vessel, to instruct the carrier to discharge cargoes without production of the original bills of lading and to agree to indemnify the carrier against the consequences of doing so.
A trading dispute under an FOB contract provides the opportunity to clarify a number of issues including the role of local custom in the nomination of a port, whose right it is to nominate a loading place within a port, the nomination of a vessel incapable of loading at the original loading place and the nomination of a vessel incapable of performing the shipment.
Zohar Zik considers the decision of ACG Acquisition XX LLC v Olympic Airlines SA, where the court refused to grant summary judgment on a claim for unpaid rent in respect of a leased aircraft where it was arguable that ACG Acquisition XX LLC ("ACG"), the lessor, had breached the lease agreement and failed to provide Olympic Airlines SA ("Olympic"), the lessee, an aircraft in an airworthy condition.
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