Freedoms of the Air and Carrier Liability

The Chicago Convention gives every State complete and exclusive sovereignty over the airspace above its territory, so no airline has a natural right to fly into a foreign country, let alone to sell seats there. The permissions it needs are the freedoms of the air: traffic rights granted by one State to another's airlines, from simply crossing its airspace to carrying passengers inside it. The commercial rights are mostly exchanged in bilateral agreements between governments, and they decide which routes an airline may fly.

Once the passengers are on board, a second body of law applies: what the airline owes them if they are hurt, their bags are lost or the flight is cancelled. International conventions, from Warsaw in 1929 to Montreal in 1999, set the carrier's liability; European regulations add compulsory insurance and fixed compensation for denied boarding, cancellations and long delays. Both subjects appear in the EASA air law syllabus, and both shape the commercial decisions made around every airline flight.

The Freedoms of the Air

The freedoms are numbered by how much the granting State gives away. ICAO's Manual on the Regulation of International Air Transport (Doc 9626) defines nine; only the first five appear in the agreements signed at Chicago, and ICAO calls the others "so-called" freedoms.

The first two are the technical freedoms: the aircraft passes through without trading. The third to fifth are the commercial or traffic freedoms. The third and fourth are normally negotiated as a matched pair, since a route that can carry traffic in only one direction is worth little. The fifth is the hardest to obtain, because it puts a foreign airline into competition for traffic between the granting State and a third State. A sixth freedom service is really a third and a fourth freedom sold as one journey through the airline's hub.

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Transit and Transport Agreements

The Chicago Conference failed to agree a multilateral exchange of commercial rights, and instead opened two separate agreements for signature in December 1944:

• The International Air Services Transit Agreement grants the first and second freedoms between its parties for scheduled services. It was widely accepted, so overflight and technical stops are rarely negotiated route by route.
• The International Air Transport Agreement, the "five freedoms agreement", offered the first five freedoms together. Few States accepted it.

The commercial freedoms are therefore traded in bilateral air services agreements between pairs of States. Each agreement lists the routes, designates the airlines of each side and sets the rules on capacity and fares, restrictively in some cases, liberally in "open skies" agreements. The European Union has gone furthest: within its single market, EU airlines may operate any route inside the Union.

Technical Stops and Cabotage

A technical stop, in the Transit Agreement's words a landing for non-traffic purposes, is a landing for fuel, maintenance, a crew change or a diversion, during which no passengers, cargo or mail are taken on or set down. Once traffic is loaded or unloaded, it is no longer a technical stop and needs traffic rights.

Scheduled services use the Transit Agreement for these stops. For non-scheduled flights, Article 5 of the Convention itself allows aircraft of Contracting States to fly into or across another State and make stops for non-traffic purposes without prior permission, subject to that State's right to require them to land or to follow prescribed routes. Annex 9 treats a flight plan received at least 2 hours before arrival as adequate notice for such a landing, provided it is made at a designated international airport (see facilitation).

Cabotage is the carriage of passengers, cargo or mail between two points in the same State by an aircraft of another State: a foreign airline flying a domestic route. Article 7 allows every State to refuse it, and to grant it to no State on an exclusive basis. Most States do refuse it, reserving domestic traffic for their own carriers. Within the EU, however, a member State may not refuse cabotage by an airline of another member State, which is how an Irish-licensed airline can fly between two Italian cities.

Scheduled Services and IATA

Article 6 of the Convention requires the special permission of the State concerned for any scheduled international air service. ICAO describes a scheduled air service as a series of flights, open to the public for remuneration, operated to a published timetable or so regularly that they form a recognisable systematic series; an international one passes through the airspace of more than one State. Charter and other non-scheduled flights fall outside that definition. The distinction survives in Item 8 of the ICAO flight plan, where the type of flight is S for scheduled air service, N for non-scheduled air transport, G for general aviation, M for military and X for other (see ATC flight plan).

The International Air Transport Association (IATA), founded in Havana in 1945, is the trade association of the airlines. It is not a regulator and must not be confused with ICAO, whose members are governments. IATA sets standards for interline ticketing, runs a clearing house for payments between airlines, allocates the two-letter airline codes seen on tickets (ICAO assigns separate three-letter designators for flight plans), publishes industry standards such as its Dangerous Goods Regulations (see dangerous goods), and runs the IATA Operational Safety Audit (IOSA) of airlines.

The Warsaw System of Liability

The Warsaw Convention of 1929 created the first uniform rules for international carriage by air. It laid down the documents of carriage, the passenger ticket, baggage check and air consignment note, made the carrier liable for death or injury, lost or damaged baggage and cargo, and delay, and in return capped that liability at low limits. Amendments followed, the most important being the Hague Protocol of 1955, which doubled the passenger limit; together they are called the Warsaw system.

The Montreal Convention of 1999, in force since 2003, replaced the Warsaw system between the States party to it. It applies to international carriage between two States party to it, or within one of them when the itinerary includes an agreed stopping place in another State. For death or bodily injury it sets two tiers:

• up to a set limit the carrier is liable regardless of fault, and cannot exclude or limit that liability;
• above that limit the carrier is liable without limit unless it proves the damage was not due to its negligence, or was due solely to a third party.

The limit was 100,000 SDR in the 1999 text, the figure most exam questions use. ICAO reviews the limits every five years for inflation, and since 28 December 2024 they stand at 151,880 SDR for death or injury, 6,303 SDR per passenger for delay, 1,519 SDR per passenger for baggage and 26 SDR per kilogram of cargo.

Special Drawing Rights

The Special Drawing Right (SDR) is a unit of account defined by the International Monetary Fund, whose value is set from a basket of major currencies. Liability limits are written in SDR rather than in dollars or euros so that the same figure applies in every country and is not tied to the fortunes of one currency. The amount is converted into national currency when the claim is settled or decided. EU insurance rules use the same unit.

Operator Insurance Requirements

Liability without the money to pay it protects nobody, so the EU makes operator liability insurance compulsory. Regulation (EC) No 785/2004, as amended, applies, with few exceptions such as state aircraft, to air carriers and aircraft operators flying within, into, out of or over the territory of the EU, including non-EU airlines. Operators must insure their liability for passengers, baggage, cargo and third parties on the ground:

• passenger cover of at least 250,000 SDR per passenger, which member States may lower to 100,000 SDR for non-commercial flights in aircraft of 2,700 kg or less;
• third-party cover per accident, rising with the aircraft's maximum take-off mass.

The insurance certificate is carried on board; unlike the certificates of registration and airworthiness it may be a copy. Hull cover for the aircraft itself is a commercial decision, not a legal requirement. Even a private flight in a light aeroplane under Part-NCO must carry its third-party liability insurance certificate.

EU Passenger Rights (EC 261/2004)

Regulation (EC) No 261/2004, the EU Air Passenger Rights Regulation known as EU261, gives passengers fixed rights to compensation and care. It protects passengers departing from an airport in the EU with any airline, and passengers flying into the EU from a third country on an EU airline. Passengers travelling free or on discounted fares not available to the public are excluded, although frequent flyer tickets are covered.

Denied boarding is refusing to carry a passenger who has presented for boarding in time with valid documents, other than for reasonable grounds such as health, safety, security or inadequate travel documents. When a flight is overbooked, the airline must first call for volunteers, who give up their seats for agreed benefits and are also entitled to reimbursement or re-routing. Only if there are too few volunteers may it deny boarding against passengers' will, and then it must pay compensation and provide care.

The same amounts apply to cancellations, unless the passengers were told early enough or offered suitable re-routing. For delays the regulation itself gave only care: meals and refreshments and a means of communication once the delay reaches 2, 3 or 4 hours depending on distance, and a hotel when the departure is put back to the next day. In the Sturgeon case of 2009 the Court of Justice ruled that passengers reaching their final destination 3 hours or more late are also entitled to compensation. No compensation is due when the airline proves that extraordinary circumstances, which could not have been avoided even if all reasonable measures had been taken, caused the cancellation or delay; care remains due.

Library articles are written for study and exam preparation. They do not replace your aircraft's approved documentation, your operator's procedures or the regulations themselves.