U.S. urged by EU to give Norwegian Irish unit the all clear

The European Union’s transport chief pressed the U.S. to let Norwegian Air Shuttle ASA serve American destinations from Ireland, hinting at an unprecedented arbitration request to end a two-year-old stalemate.

European Transport Commissioner Violeta Bulc said the EU-U.S. “open-skies” agreement, which took effect in 2008, requires American authorities to allow Norwegian Air Shuttle’s Irish subsidiary to fly trans-Atlantic routes. Amid domestic industry and political opposition, the U.S. Department of Transportation has failed to decide on the Irish unit’s application in December 2013 for a foreign-carrier permit.

Following meetings she held this week in Washington, Bulc left open the possibility of triggering for the first time a dispute-settlement clause in the open-skies pact. The European Commission, the 28-nation EU’s executive arm, is supporting Norwegian Air Shuttle in a bid to increase competition on trans-Atlantic routes. While Norway isn’t a member of the EU, Ireland belongs to the bloc.

“The EU is seriously considering all available options to swiftly solve the issue,” Bulc said in an e-mailed statement on Wednesday in Brussels. “I hope that actions will rapidly be taken to ensure compliance with the EU-U.S. air-transport agreement.”

The U.S. government’s inaction over the application by Norwegian Air Shuttle’s Irish arm, which wants to connect Cork and Boston, has slowed what is among the industry’s most ambitious expansion plans. The Fornebu, Norway-based discount carrier began as a domestic operator in 1993, added bases elsewhere in Europe beginning in 2006 and started offering long-haul services in 2013.

The airline now serves the U.S., the Caribbean and Bangkok from several northern European cities including London and intends in July to offer flights from Paris to New York, Los Angeles and Fort Lauderdale, Florida. It uses Boeing Co. 787 Dreamliners for long-haul operations and Boeing 737-800 aircraft for short-haul routes.

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