Title: Informal Ecofin: guiding principles on intervention for insurance problems by airline companies
Category: Press Releases by the Belgian EU Presidency
Description: The terrorist attacks in the US have severely affected the civil aviation sector on both side of the Atlantic, notably as far as its insurance covering is concerned.
The Ecofin Council of 21 September has been informed of the problems due to further cover limitation of the insurances to compensate for damages on third persons following acts of war or terrorism. It expressed its concern and appeals to industry to find, wherever possible, market-based solutions urgently without recourse to assistance from governments.
The Special Transport Council of 14 September invited the Commission to set up an ad hoc group in order to examine coordination and cooperation needs concerning security within the Union. A first reporting of this group is expected for the Transport Council of 15 October. This report have to take into account the orientations adopted by the assembly of the International Civil Aviation Organization, which will start next 25 September.
The Ecofin Council invites the Commission to enlarge urgently the work of this ad hoc group to insurance problems, which should also include representatives of Ministries of Finance, so that the necessary coherent measures could be coordinated.
Those Governments of the European Union, which because of situations of "force majeure" are considering to provide liability cover to airlines companies facing insurance problems, are agreed to satisfy the following precise conditions :
- government support will be limited to address a specific short-term failure in the commercial insurance market, to ensure that third party cover for war and terrorism remain available ;
- governments will charge a reasonable premium which as far as possible reflects the risks involved, for the schemes they introduce, although itÂ’s possible this will be waved in the short-term;
- the schemes will be introduced for one month with work continuing on a sustainable solution and to encourage industry to return to the market as soon as possible.
General state aids to help unprofitable companies having to be excluded, the measures proposed are the best way to solve the temporary problems of the airline sector. These measures, including amounts involved, will be notified to the Commission.
Date: 24/09/2001
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Source: European Union Website |