Emirates responds to subsidy claims

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Sir Tim Clark Emirates president speaking about subsidy claims July 2015

Emirates has released a response to the allegations of subsidy and unfair competition made by US airlines in recent months.

The Dubai-based airline says in a statement issued on 30 June that the allegations made by the US carriers, Delta Air Lines, United Airlines and American Airlines, are wrong.
Emirates accused the three airlines of having, “launched an aggressive lobbying campaign in January, in a protectionist bid to restrict consumer choice, and restrict the growth of international flights to the USA operated by Emirates and other Gulf airlines.”

Emirates president, Sir Tim Clark, (see picture), says: “The methods employed by the US legacy carriers to discredit Emirates have been surprising and frankly, repugnant. We do not underestimate their lobbying prowess, but facts are facts. Unlike the [airlines’] white paper, which is riddled with inaccuracies, conjecture, and legal misinterpretations, Emirates’ response is comprehensive and based on hard facts”. Emirates responded to the allegations one by one. First, the airline denies that it is subsidised. Clark stresses that Emirates has, “been profitable for 27 years straight,” and that its expansion has been funded by its own cash flow.

Second, Clark says that the US carriers, “built their case on the wrong legal standards”. He stresses that the World Trade Organization’s anti-subsidy rules do not apply to international aviation, nor are they implicitly incorporated in the US open skies agreements. His view is that, “the US legacy carriers have framed their complaint in terms of their own narrow interests”, adding that they favour open skies agreements, “only when such work to their financial advantage”.

Clark concludes: “The [US airlines’] white paper is littered with self-serving rhetoric about fair trade, [a] level playing field, and saving jobs, but their mess of legal distortions and factual errors falls apart at the slightest scrutiny”.

The Partnership for Open and Fair Skies, which includes American, Delta and United, responded in a statement. It says: “Emirates can submit as many pages as it wants, but it still won’t paper over what has been well-documented: Emirates has received billions in subsidies and unfair benefits from the treasury of the UAE. Our investigation shows that these massive subsidies have …[distorted] international competition and tilting the playing field to its advantage.”