Part I – general 5 The Sources of Int’l Air Law 5 Q? How does customary law relate to int’l law?

2) Structure of IATA:

The structure of the organization is very much geared to this two-tear type of activity. On the trade association side, you have the Secretariat, headed by the Director General. You have two main groupings, which report to the Secretariat on legal matters, Legal Advisory Group & an Apolitical Advisory Group. & then you have four committees which report directly to the main executive body of the organization, which was called Ex. Committee & now called the Board of Governors. It consists of 25 people & most of them are the chief executive of the big carriers & each governor is elected for a period of 3 years.

In theory, the Supreme Body of the Organization, is called Annual General Meeting. It is annual meeting where all members of IATA are called together. All members are entitled to participate & vote w/ one vote. This is only in theory. In practice, the Annual General Meeting does not have much power. They meet usually for two days & most of the time is taken up by routine matters or industry presentations. Thus, the real decision-making happens at the Board of Governors. Yearly assembly of the members at the Annual General Meeting & each member of the org has a seat & vote in the body. The GA determines by vote who is to become a member of the board of governors (Executive) 1/3 is elected yearly for terms of 3 years (hence they’re offset).

Then there is an executive body that is called the Board of governors, which consists of 25 members. The director general is the chief executive officer of the organization. He reports to the Board of Governors. The Executive decide on policy matters, who is the chief executive; prepare the budget (which is approved by the GA). The executive is assisted by a number of committees, which assist the board of governors normally in policy. (See below for structure). These are sub-groups of the executive as members of the committee come from those of the 25 executives.

Standing committees & the so-called special committees – these are groups that are consisting of airline executives – no other executives are admitted. The committees report to the board & make recommendations on policy matters, one of these committees is called the legal advisory council, which consists of the 25 legal advisors of the airline & make recommendations to the board. Committees are advisory in nature & do not do more than that, as it is the Board that approves recommendations.

3) Main functions of IATA

What does the organization & what does the organization stand for? Why do the carriers regroup in such an organization & pay the high dues to maintain the organization?
The organization has a two-fold purpose & therefore a two-type structure:

Trade Association Function:

Main purpose of the organization: to work w/ gov’ts to pursue measures that the industry needs to develop. IATA represents of all members when lobbying gov’ts & enlisting the support of the governments towards what the industry is doing. This is called the trade association function: You harmonize the rules by which the members operate. You represent the members towards the government, you establish a liaison b/t the gov’t & the members &, if necessary, you lobby the gov’t in favour of the aims of the members. They also lobby ICAO, thus the lobbying effect is not done only on the individual government level. These are the classical functions of the organization.

Tariff Coordination Function:

Another group of functions & for which IATA was more known in 50s, 60s, & early 70s than the classical function are called tariff coordination. The carriers meet in conferences & discuss & usually agree on the fares & the rates that are going to be filed w/ gov’ts on the int’l routes in question. The fares are the term used to describe for passenger rates. The term “rates” means the price charged for the transportation of cargo. “Fares & rates” when used together are called tariffs.
Tariff coordination is a system, which deals w/ routes by geographical region. These conferences are divided into 3 geographical regions:

1. 
   The Americas
   
2. 
   Europe & Africa
   
3. 
   Asia & Oceania.
   

When you have transatlantic routes, we used to have an amalgamation of the Conferences of the Americas & Europe & Africa. The conference system is a system that has set up specific conferences for specific geographical regions. W/ deregulation, this conference system has lost a lot of its clout. In the 60s & 70s, all the int’l routes were subjected to this conference system. Beginning the late 1970s, some countries were no longer so happy w/ the system. For example, the American carriers were required to stay out. Later they were allowed to rejoin.

This conference system has been phased out in the North America & Europe. Thus, there are some areas in the world where the conference system has been phased. But, in most other areas the conference system is still working & is still used.
-On the tariff coordination side, you have basically the same scenario w/ the director general & the secretariat. Thus they have a double function. & then you have all the conferences. The conferences are, at least in theory, sovereign: they do not report to anyone. They are sovereign for procedural matters & on certain policy matters they are subject to the policy guidance of the Board of Governors. But, as far as individual decision-making is concerned, the conferences are sovereign &, therefore, not subject to reporting to anyone.

Q? Why was a Conference System implemented?

The conference system is used b/c of the interrelationship b/t the different routings in the global system, you need a way of establishing a fares & rates system where the interrelationship b/t the varied routes could be taken into account. No single government & no single carrier could establish the fares & rates on int’l routes without taking into account the neighboring routes & the feeder routes. B/c of this interrelationship, the governments thought that the best system would be a system whereby the carriers themselves established the fares in the same way this had been done previously in the maritime conferences. After the second world war, when IATA & the int’l air traffic system was re-established, most governments thought the best way for establishing int’l fares & rates would be a system which would be modeled on the maritime conferences. This is why they fostered & encouraged the re-establishment of IATA in 1945 in Havana. In the following year, when the U.S. & the U.K. met at Bermuda to negotiate their first bilateral air transport agreement, the two parties agreed that the fares & the rates under the Bermuda I, 1946 agreement would be established by a conference system & they had IATA in mind.
They stipulated, however, that any fares & rates that would be agreed to in such a conference would be made subject to governmental approval. Thus, it is a mixed system: the carriers themselves are left to negotiate the fares & rates but those fares & rates cannot enter into force before they have been agreed to & approved by the governments concerned. So, this was the pattern that showed the way. The Bermuda I agreement established a pattern which later on was emulated by all other governments. They used the Bermuda I agreement as a model for the way in which tariffs should be coordinated & agreed upon. All subsequent bilateral agreements until the early 1980s, followed exactly this model. IATA was almost entrusted by the governments w/ the negotiation & coordination of fares & rates subject only to government approval. This is the basis on which the tariff coordination system was set.
This activity for IATA was not only extensive, but it also put IATA in the driver’s seat b/c IATA was not only given the powers to coordinate those tariffs but also to enforce them. If there was a carrier who would dare to charge to lower than the fares agreed upon in conference, IATA was authorized to investigate this & if there was an infringement to impose fines. This is why IATA came to be known as a cartel. Thus, IATA got a bad name in the late 70s & early 80s. Thus, IATA had some anti-trust proceedings agst them. Thus, in the early 80s, IATA had to loosen up its rules & its enforcement powers were taken away from them. So, today the tariff coordination functions are still there. But, IATA today is a toothless tiger: they can agree to the fares, but if a carrier goes its own way, IATA can do nothing about it. Since 1978, no member is no longer obliged to participate in tariff coordination.

Q? What happens if a bilateral air transport agreement does not mention gov’tl approval?

The fact that governmental approval is not mentioned does not mean that the governmental approval is not necessary. In fact, certain governments require governmental approval of all results of tariff coordination conferences. The U.S. Government is one such government & since 1993 the E.U. government does the same.

Directory: pubdocs -> files
files -> International maritime conventions
files -> Chapter 1: Property as rights, not thing
files -> Insurance Law – May 4
files -> Contractual Obligations – Prof. Helge Dedek Introduction 1
files -> Constitutional Limits on Criminal Law 1
files -> Antonio Iacovelli Winter 2005 Advanced Criminal Law
files -> Private International Law – Prof. Walsh Summer 2005
files -> Part I: conceptualizing and justifying ip space 3
files -> Topic One Seaworthiness and Common Venture, chapter 15

Download 0.73 Mb.

Share with your friends: