Rep. Rick Larsen (WA-02), the top-Ranking Democrat on the House Subcommittee on Aviation, along with Rep. Peter DeFazio (OR-04) and Republican Reps. Frank LoBiondo (NJ-02) and Drew Ferguson (GA-03), have introduced bipartisan legislation that would preclude the Department of Transportation (DOT) from issuing a foreign air carrier permit for US operations to an airline that exploits “flags of convenience” to avoid regulations in its home country.

On December 2, 2016, DOT issued a foreign air carrier permit to Norwegian Air International (NAI), an airline that established itself in Ireland in order to avoid Norway’s strong labor protections.

“The Department of Transportation’s decision to grant Norwegian Air International a foreign air carrier permit was in direct contravention of the US–EU Open Skies Agreement which ensures airlines doing business in the US have strong labor standards,” said Larsen. “This bill would prevent DOT from issuing foreign carrier permits when airlines try to side step regulations and labor laws by setting up flags of convenience schemes.”

“When the Department of Transportation granted Norwegian Air International’s permit, it guaranteed a race to the bottom in our transatlantic aviation market. Now, any airline can set up under a flag of convenience to exploit weak labor laws in other countries, save money, and undercut competition. Our bipartisan bill protects American jobs from predatory and unfair competition, and it protects the American flying public from deceptive flags of convenience,” said DeFazio.

DOT’s controversial decision to grant NAI a permit will encourage future opportunistic airlines to continue this race to the bottom in international civil aviation, threatening U.S. carriers’ ability to compete in critical international markets.

H.R. 2150, the Flags of Convenience Don’t Fly Here Act, would prohibit DOT from issuing a permit to a foreign airline to serve the United States unless DOT determines that the foreign air carrier is not exploiting a “flag of convenience” by establishing itself in a country other than the country of its majority owner to avoid regulations. The bill would also require DOT to ensure any new foreign air carrier permits issued to European airlines are consistent with the fair labor standards and fair competition requirements of the US-EU-Norway-Iceland Air Transport Agreement.

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