Cabotage
Encyclopedia
Cabotage ˈkæbətɨdʒ is the transport
of goods or passengers between two points in the same country by a vessel or an aircraft registered in another country. Originally starting with shipping
, cabotage now also covers aviation
, railways and road transport
. Cabotage is "trade or navigation in coastal waters, or, the exclusive right of a country to operate the air traffic within its territory."
Cabotage is commonly used as part of the term "cabotage rights," the right of a company from one country to trade in another country. In aviation terms, it is the right to operate within the domestic borders of another country. Most countries do not permit cabotage by foreign companies, although this is changing within Europe for member states of the European Union
. Economically, cabotage regulations that limit trade to domestic carriers constitute a form of protectionism
. Within a nation, cabotage rules may be politically justifiable for that very purpose, or because of national security
or public safety
concerns.
, pure cabotage is the ninth freedom. An example of this situation would be if a service between St. Louis
and Denver
was offered by a non-U.S. carrier without continuing service to a foreign destination. While this situation is virtually nonexistent in scheduled service, certain charter flights are allowed under U.S. rules.
If service offered between two domestic points continues to or from a foreign destination, the practice is considered continuing cabotage, which is the eighth freedom. If a carrier does not have this right, then on a hypothetical service from Paris to Kolkata
via Mumbai, it could not allow passengers to board in Mumbai and fly to Kolkata; only passengers who boarded in Paris could be carried on to Kolkata.
Cabotage situations can also occur as a consequence of hub-and-spoke operations
. Consider that Air Canada
has a major hub at Toronto
that offers flights to several U.S. cities. While a passenger is able to buy a ticket from Boston
to Toronto, and a separate ticket from Toronto to Seattle later that same day, both flights cannot be offered on the same itinerary because this would effectively be a U.S. domestic service.
(now closed) and Frankfurt. Air France flew from Düsseldorf. British Airways flew from Munster/Osnabrück, Hannover, and some other cities.
In October 2007, the United Kingdom granted Singapore carriers the right to fly domestic UK routes as part of an open skies
agreement. Under the agreement, British carriers were allowed to fly to any city from Singapore.
The Closer Economic Relations
agreement allows Australian air carriers to fly domestically and internationally from New Zealand
and vice versa. Two Australian carriers, Jetstar (a Qantas
subsidiary) and Pacific Blue
(a Virgin Australia subsidiary) fly domestic routes within New Zealand, and Qantas offers flights connecting New Zealand and North America. Air New Zealand
offers one international destination from Australia outside New Zealand, flying between Sydney
and Rarotonga
. Previously, Qantas Jetconnect
and Ansett New Zealand
were Australian owned airlines based in New Zealand.
Transport
Transport or transportation is the movement of people, cattle, animals and goods from one location to another. Modes of transport include air, rail, road, water, cable, pipeline, and space. The field can be divided into infrastructure, vehicles, and operations...
of goods or passengers between two points in the same country by a vessel or an aircraft registered in another country. Originally starting with shipping
Shipping
Shipping has multiple meanings. It can be a physical process of transporting commodities and merchandise goods and cargo, by land, air, and sea. It also can describe the movement of objects by ship.Land or "ground" shipping can be by train or by truck...
, cabotage now also covers aviation
Aviation
Aviation is the design, development, production, operation, and use of aircraft, especially heavier-than-air aircraft. Aviation is derived from avis, the Latin word for bird.-History:...
, railways and road transport
Road transport
Road transport or road transportation is transport on roads of passengers or goods. A hybrid of road transport and ship transport is the historic horse-drawn boat.-History:...
. Cabotage is "trade or navigation in coastal waters, or, the exclusive right of a country to operate the air traffic within its territory."
Cabotage is commonly used as part of the term "cabotage rights," the right of a company from one country to trade in another country. In aviation terms, it is the right to operate within the domestic borders of another country. Most countries do not permit cabotage by foreign companies, although this is changing within Europe for member states of the European Union
European Union
The European Union is an economic and political union of 27 independent member states which are located primarily in Europe. The EU traces its origins from the European Coal and Steel Community and the European Economic Community , formed by six countries in 1958...
. Economically, cabotage regulations that limit trade to domestic carriers constitute a form of protectionism
Protectionism
Protectionism is the economic policy of restraining trade between states through methods such as tariffs on imported goods, restrictive quotas, and a variety of other government regulations designed to allow "fair competition" between imports and goods and services produced domestically.This...
. Within a nation, cabotage rules may be politically justifiable for that very purpose, or because of national security
National security
National security is the requirement to maintain the survival of the state through the use of economic, diplomacy, power projection and political power. The concept developed mostly in the United States of America after World War II...
or public safety
Public Safety
Public safety involves the prevention of and protection from events that could endanger the safety of the general public from significant danger, injury/harm, or damage, such as crimes or disasters .-See also:* By nation...
concerns.
Example situations
In the context of the freedoms of the airFreedoms of the air
The freedoms of the air are a set of commercial aviation rights granting a country's airline the privilege to enter and land in another country's airspace...
, pure cabotage is the ninth freedom. An example of this situation would be if a service between St. Louis
Lambert-St. Louis International Airport
Lambert-St. Louis International Airport is a Class B international airport serving Greater St. Louis. It is located approximately northwest of downtown St. Louis in unincorporated St. Louis County between Berkeley and Bridgeton. It is the largest and busiest airport in the state with 250 daily...
and Denver
Denver International Airport
Denver International Airport , often referred to as DIA, is an airport in Denver, Colorado. By land size, at , it is the largest international airport in the United States, and the third largest international airport in the world after King Fahd International Airport and Montréal-Mirabel...
was offered by a non-U.S. carrier without continuing service to a foreign destination. While this situation is virtually nonexistent in scheduled service, certain charter flights are allowed under U.S. rules.
If service offered between two domestic points continues to or from a foreign destination, the practice is considered continuing cabotage, which is the eighth freedom. If a carrier does not have this right, then on a hypothetical service from Paris to Kolkata
Netaji Subhash Chandra Bose International Airport
Netaji Subhash Chandra Bose International Airport is an airport located in Kolkata, West Bengal, India, serving the greater Kolkata metro area. The airport was originally known as Dum Dum Airport before being renamed in the honour of Subhas Chandra Bose...
via Mumbai, it could not allow passengers to board in Mumbai and fly to Kolkata; only passengers who boarded in Paris could be carried on to Kolkata.
Cabotage situations can also occur as a consequence of hub-and-spoke operations
Airline hub
An airline hub is an airport that an airline uses as a transfer point to get passengers to their intended destination. It is part of a hub and spoke model, where travelers moving between airports not served by direct flights change planes en route to their destinations...
. Consider that Air Canada
Air Canada
Air Canada is the flag carrier and largest airline of Canada. The airline, founded in 1936, provides scheduled and charter air transport for passengers and cargo to 178 destinations worldwide. It is the world's tenth largest passenger airline by number of destinations, and the airline is a...
has a major hub at Toronto
Toronto Pearson International Airport
Toronto Pearson International Airport is an international airport serving Toronto, Ontario, Canada; its metropolitan area; and the Golden Horseshoe, an urban agglomeration that is home to 8.1 million people – approximately 25% of Canada's population...
that offers flights to several U.S. cities. While a passenger is able to buy a ticket from Boston
Logan International Airport
General Edward Lawrence Logan International Airport is located in the East Boston neighborhood of Boston, Massachusetts . It covers , has six runways, and employs an estimated 16,000 people. It is the 19th busiest airport in the United States.Boston serves as a focus city for JetBlue Airways...
to Toronto, and a separate ticket from Toronto to Seattle later that same day, both flights cannot be offered on the same itinerary because this would effectively be a U.S. domestic service.
Cabotage in passenger aviation
Australia and Chile allow passenger airlines owned by foreign entities to operate domestic flights. Until 1991, Lufthansa was prohibited from flying into West Berlin. Pan Am, British Airways, and Air France operated routes between the Federal Republic of Germany and West Berlin. For a short time in the late 1980s, TWA also flew between then-West Germany and West Berlin. During this time, Pan Am flew to Tegel, in Berlin, from Munich-Riem AirportMunich-Riem Airport
Munich-Riem Airport was the main, international airport of Munich until it was closed down on 16 May 1992, the day before the new airport near Freising commenced operation. It was located near the old village of Riem in the Munich borough of Trudering-Riem.-History:Construction on the airport...
(now closed) and Frankfurt. Air France flew from Düsseldorf. British Airways flew from Munster/Osnabrück, Hannover, and some other cities.
In October 2007, the United Kingdom granted Singapore carriers the right to fly domestic UK routes as part of an open skies
Open skies
Open skies is an international policy concept which calls for the liberalization of rules and regulations on international aviation industry most specially commercial aviation - opening a free market for the airline industry...
agreement. Under the agreement, British carriers were allowed to fly to any city from Singapore.
The Closer Economic Relations
Closer Economic Relations
Closer Economic Relations is a free trade agreement between the governments of New Zealand and Australia. It is also known as the Australia New Zealand Closer Economic Relations Trade Agreement and sometimes shortened to...
agreement allows Australian air carriers to fly domestically and internationally from New Zealand
New Zealand
New Zealand is an island country in the south-western Pacific Ocean comprising two main landmasses and numerous smaller islands. The country is situated some east of Australia across the Tasman Sea, and roughly south of the Pacific island nations of New Caledonia, Fiji, and Tonga...
and vice versa. Two Australian carriers, Jetstar (a Qantas
Qantas
Qantas Airways Limited is the flag carrier of Australia. The name was originally "QANTAS", an initialism for "Queensland and Northern Territory Aerial Services". Nicknamed "The Flying Kangaroo", the airline is based in Sydney, with its main hub at Sydney Airport...
subsidiary) and Pacific Blue
Pacific Blue
Pacific Blue may refer to:*Pacific Blue *Pacific Blue Airlines...
(a Virgin Australia subsidiary) fly domestic routes within New Zealand, and Qantas offers flights connecting New Zealand and North America. Air New Zealand
Air New Zealand
Air New Zealand Limited is the national airline and flag carrier of New Zealand. Based in Auckland, New Zealand, the airline operates scheduled passenger flights to 26 domestic destinations and 24 international destinations in 15 countries across Asia, Europe, North America and Oceania, and is...
offers one international destination from Australia outside New Zealand, flying between Sydney
Sydney
Sydney is the most populous city in Australia and the state capital of New South Wales. Sydney is located on Australia's south-east coast of the Tasman Sea. As of June 2010, the greater metropolitan area had an approximate population of 4.6 million people...
and Rarotonga
Rarotonga
Rarotonga is the most populous island of the Cook Islands, with a population of 14,153 , out of the country's total population of 19,569.The Cook Islands' Parliament buildings and international airport are on Rarotonga...
. Previously, Qantas Jetconnect
JetConnect
Jetconnect is an airline based in Auckland, New Zealand. It is a shell company of Qantas. It was established in July 2002 and started operations in October 2002. It operates trans-tasman services between New Zealand and Australia under the Qantas brand. It employs crew based in New Zealand and...
and Ansett New Zealand
Ansett New Zealand
Ansett New Zealand was a wholly owned airline subsidiary of Ansett Australia, serving the New Zealand domestic market between 1987 and 2000. In order to comply with regulatory requirements relating to the acquisition of Ansett Australia by Air New Zealand, Ansett New Zealand was sold to News...
were Australian owned airlines based in New Zealand.
See also
- Jones Act
- Freedoms of the airFreedoms of the airThe freedoms of the air are a set of commercial aviation rights granting a country's airline the privilege to enter and land in another country's airspace...
- Passenger Services ActPassenger Services ActThe Passenger Vessel Services Act of 1886 is a piece of United States legislation which came into force in 1886 relating to cabotage. Essentially, it says:...
- Open skiesOpen skiesOpen skies is an international policy concept which calls for the liberalization of rules and regulations on international aviation industry most specially commercial aviation - opening a free market for the airline industry...
- ProtectionismProtectionismProtectionism is the economic policy of restraining trade between states through methods such as tariffs on imported goods, restrictive quotas, and a variety of other government regulations designed to allow "fair competition" between imports and goods and services produced domestically.This...