3. The Parties shall review their progress towards a second-stage agreement no later than eighteen months after the date on which the negotiations referred to in paragraph 1 are to begin. If the Parties have not reached an agreement during the second phase within twelve months of the commencement of the review, each Party reserves the right to subsequently suspend the rights set forth in this Agreement. This suspension will enter into force at the earliest at the beginning of the International Air Transport Association (IATA) traffic season, which will begin at least twelve months after the date on which the suspension is notified. 7. Access by Community air carriers to transport purchased by the UNITED States Government is governed by Annex 3. Today, the United States and the European Union sign a comprehensive agreement on first-stage air services, which will have significant economic benefits for America and Europe. The agreement will replace existing bilateral agreements between the US and EU member states and establish an open skies plus framework between the US and the 27 EU member states. Open skies advantages: the agreement allows each U.S. and European airline to fly between every city in the European Union and any city in the United States; operate without limitation on the number of flights, aircraft and routes; set rates based on market demand; and enter into cooperative agreements, including code-sharing, franchising and leasing. In addition, the agreement will promote enhanced regulatory cooperation in areas as diverse as competition law, public subsidies, the environment, consumer protection and safety.
It sets up a joint consultative committee that will allow the US and the EU to clarify issues and develop areas of cooperation. Investment measures: Under the Agreement, US investors are allowed to invest in a European Community airline, provided that the airline is majority owned by a Member State and/or nationals of Member States and is effectively controlled by those airlines. The agreement clarifies that under US law, EU investors can hold up to 49.9% of a US airline`s total equity and even more on a case-by-case basis, provided that foreigners hold no more than 25% of the voting shares and that the airline is under the effective control of the US. . . .