After nearly 3 years, DOT approves Norwegian Air permit

The Department of Transportation on Friday gave final approval to the controversial foreign air carrier permit application of Norwegian Air Group’s Ireland-based subsidiary, ending a review process that lasted for nearly three years.

The application had drawn fierce opposition from Delta, United and American, as well as from U.S. airline industry unions and some members of Congress. However, it received staunch support from the U.S. travel industry and the European Union. JetBlue, a potential transatlantic competitor to Norwegian, also weighed in on the case recently, calling the DOT’s delayed action “concerning.”

In the DOT’s final order, acting assistant secretary for aviation Jenny Rosenberg said that the case was among the most novel and complex ever reviewed by the department.

“Regardless of our appreciation of the public policy arguments raised by opponents, we have been advised that the law and our bilateral obligations leave us no avenue to reject this application,” she wrote.

Norwegian Air Group, which already flies low-cost transatlantic flights to the U.S. under the Norwegian Air Shuttle brand, had argued that approval of the Irish subsidiary, called Norwegian Air International, would allow it to more easily expand its connecting route network to South America, Asia and Africa.

While Ireland is a member of the European Union, Norway is not, and therefore Norwegian Air Shuttle cannot as easily take advantage of international EU aviation agreements as Norwegian Air International could.

In a statement Friday, Norwegian said that the ruling would open the door to flights from Ireland to the U.S. The carrier has said it plans to fly from Cork to Boston and New York.

“While the delays Norwegian have faced have been unfortunate and unnecessary, ultimately the decision now made by the U.S. DOT finally paves the way for greater competition, more flights and more jobs on both sides of the Atlantic,” the company said. “Above all, it is a victory for millions of passengers who will benefit from more choice and lower fares.”

But the decision evoked a fierce reaction from the Air Line Pilots Association (ALPA), the U.S.’s primary airline pilots’ union, which has long accused Norwegian of vying to use Ireland as a so-called flag of convenience in order to take advantage of labor laws that are weaker than those of Norway. Norwegian Air, ALPA contends, intends to hire employees from Singapore and Thailand on short-term, low-wage contracts.

In a statement Friday, ALPA president Tim Canoll said the union is considering all possible options to reverse the decision.

“This flawed action is a lasting legacy of the Obama administration and demonstrates an egregious lack of support for working men and women in this country,” he said. “ALPA would never have supported this Air Transport Agreement if we had known how our government would apply it. Given this decision, why should anyone trust the U.S. government to enforce its own trade agreements?”

In its ruling, the DOT took note of the arguments put forward by ALPA and others, but made references to assurances Norwegian has made to use only U.S- and EU-based crew on transatlantic flights.

In tentatively approving the Norwegian Air application in April, the DOT determined that labor provisions within the U.S.-EU aviation agreement don’t provide a basis for rejecting an otherwise qualified foreign air carrier permit application.

Travel industry advocates cheered Friday’s decision.

“If ever there were a trade policy that brings jobs to U.S. soil, this is it: Norwegian Air is flying and will buy more America-made planes, their passengers will spend money in American businesses, and American travelers will have more and cheaper options when they fly,” U.S Travel Association CEO Roger Dow said. “This announcement is an unmistakable endorsement of competition, connectivity and Open Skies agreements, and a welcome repudiation of protectionist, anti-competitive policymaking.”

The fight over Norwegian Air’s U.S. expansion likely is not over yet.

The DOT is still reviewing an application by the company to operate U.S. flights using a U.K-based entity.

That decision could serve as a test of the approach that the incoming Trump administration will take on international aviation matters.