Etihad lays out its case to German court over airberlin codeshare

Carrier says air pact is ‘clear and unequivocal’.

An aircraft operated by German carrier airberlin leaves Tegel airport in Berlin. Reuters

Etihad Airways has presented a German court with its main reasons for appealing against an earlier court decision, when 29 codeshares the carrier operates with the German airline airberlin were revoked.

The UAE flag carrier, which has a 29.2 per cent stake in airberlin, submitted its reasons for the appeal to the Higher Administrative Court in Lüneburg after filing a notice of appeal on Monday, the Abu Dhabi-based airline said.

Etihad had said on Monday that it would “fight all the way” to protect its investment in airberlin after the Administrative Court of Braunschweig ruled last week that the country’s ministry of transport was entitled to stop Etihad from selling tickets on some routes operated by airberlin, Germany’s second-largest airline.

“As the Air Traffic Agreement and the Route Schedule are bilateral agreements, their legal interpretation should be based upon a common understanding between the two governments,” Etihad said. “This common understanding has been demonstrated by the German ministry of transport’s approval of the now-disputed codeshares six times in a row since 2012. The unilateral decision by the ministry to change this interpretation is not legally permissible.”

The German court has ruled that Etihad would not be able to operate codeshares on some flights from January 16 to the end of its winter schedule in March because they were not covered by the air traffic agreement between the UAE and Germany.

During the past 12 months, Etihad and its Arabian Gulf peers Emirates and Qatar Airways have been under increasing regulatory scrutiny amid allegations from American and European rivals of unfair practices in breach of open-skies agreements.

“This is a battle for the proper enforcement of the bilateral agreement between Germany and the UAE and for the protection of competition and consumer benefits,” said Jim Callaghan, the general counsel for Etihad. “We believe the terms of the bilateral agreement are clear and unequivocal and we are confident that a correct review of our appeal will lead to the continuation of competition and choice in the German market.”

Etihad has said the German transport ministry had previously approved the codeshare agreement between it and airberlin covering 63 routes. However, in the summer of 2014 the ministry of transport raised concerns about 29 of the codeshares, based on “lobbying by Lufthansa”, Germany’s flag carrier.

In November, the transport ministry approved the 29 codeshares to continue only until January 15 this year.

The ministry left the remaining codeshare agreements intact.

Etihad has also asked for injunctive relief to continue to fly the disputed routes until March 26 to avoid inconveniencing its passengers, it said.

The codeshares are important for airberlin as it tries to return to profitability after years of losses.

Such deals allow carriers to offer more destinations as part of their network, reaching more customers and thus helping to fill planes and boost revenues.

Airberlin said that the countries’ bilateral air traffic rights agreement allows Etihad to fly to four destinations in Germany with its own aircraft, plus a further three in Germany via codesharing, and that the agreement permits flights that go from these points beyond Germany.

The German magazine Der Spiegel reported on its website that workers’ representatives at airberlin have written to the German chancellor, Angela Merkel, to ask her to find a political answer to the dispute.

Separately, airberlin said yesterday that its load factor increased in December as its seat capacity declined.

Load factor was 79.9 per cent, up 0.9 per cent from a year earlier, while capacity was down 8.4 per cent.

* The National, with additional reporting by Reuters