European transport ministers have approved a mandate for the European Commission to negotiate with the Rudd Labor Government on a potential ‘open skies’ agreement between Australia and the European Union (EU).

I welcome this decision as an important step towards a historic open skies agreement which could deliver greater competition, more flights and lower air fares between Australia and EU countries.

An ‘open skies’ agreement could remove many – if not all – of the existing regulatory limitations on Australian and European airlines operating between our two continents – allowing them to offer more flights and a wider range of services at the most competitive prices.

Such an outcome would benefit Australian businesses and travellers.

Currently, flights from Australia to Europe are limited by outdated bilateral agreements. For example, our carriers are only allowed to offer three flights per week to Paris.

The new Australian Government is committed to negotiating a truly comprehensive agreement with the EU.

The agreement will be broader than market access issues, and is likely to address competition, safety and security and environmental protection issues.

The EU is Australia’s largest aviation market. In 2007, 4.5 million passengers travelled between Australia and the EU – an average of 43,780 passengers each way per week.

Negotiations for an ‘open skies’ agreement will build on Australia’s ‘Horizontal’ air services agreement with the EU.

The Horizontal agreement, signed in April 2008, recognises the existence of a single European market for air transport links to and from Australia.