Richard North, 08/03/2020  

There is something rather odd about the phrasing of the announcement made by Grant Shapps, transport secretary, in respect of the European Union Aviation Safety Agency (EASA).

According to Shapps, who has been speaking to Aviation Week, the UK will withdraw (my italics) as a member state of EASA after the transition period and shift responsibility for aircraft certification and safety regulation to its own Civil Aviation Authority (CAA).

The point at issue is the choice of that word, withdraw. We are not going to withdraw, as such. The UK ceased to exercise any role in the management of EASA when it left the EU at end of January this year. And, at the end of the transition period, all EU law related to aviation safety will cease to apply to the UK and the UK will automatically no longer play any part in the EU's aviation safety system.

There is a provision whereby a European third country can participate in EASA (see Article 129), but the conditions are such that the UK could not entertain such an arrangement, not least that it would have to adopt all EU law relating to aviation safety. Working within the framework of EASA would also mean having to accept the jurisdiction of the ECJ.

We have known this would be unacceptable for some considerable time though, which makes the Aviation Week "exclusive" something of a non-story. We actually wrote about it in 2014, and several times since then, with an especially relevant report in late 2018, where I noted that the issues were fully apparent in January 2017.

This, of course, hasn't stopped the likes of the BBC and the Guardian treating this as something new, using the "hook" of the secretary's comments as the justification for the story - typical of the breed where nothing is news until they have published it.

The Financial Times, however, takes a different slant, headlining: "UK aerospace industry warns of risk from leaving European agency". It thus tells us of the industry warning of jobs and investment at risk, and its preference that the UK should continue to participate in EASA.

This is underlined by Paul Everitt, chief executive of ADS, the aerospace industry trade body, representing industries delivering £36 billion a year. He declares that "UK influence in EASA ... helps make our industry attractive to the investment it needs to be home to the development of a new generation of advanced aircraft technology".

There is something rather pathetically naïve about this statement, not untypical of the general approach of industry to Brexit. There is no likelihood whatsoever of a Johnson administration accepting the terms set out in EU law for participation in EASA. Dropping out was a done deal the moment Johnson became prime minister.

However, this is now going to create a massive problem for civil aviation, both in terms of design and manufacturing and operations. In the first instance, the UK must rebuild its body of law, covering a vast range of enterprises and activities. Then it must reconstruct the CAA which, having ceded many of its functions (and personnel) to EASA, must re-acquire capabilities to act as an independent regulator.

Shapps talks glibly of the UK, outside of EASA membership, seeking "mutual recognition of certifications in bilateral agreements with other countries and blocs".

He also seems to indicate that this will be something of a leisurely process, stating that the CAA will "eventually" assume responsibility for new aircraft type certificates and airworthiness approvals, suggesting that this will occur "over a period of time".

What he doesn't seem to appreciate is that, when the UK is outside EASA, many of the certifications and approvals issued to UK enterprises (and individuals) will no longer be valid and that certification issued by the CAA will not be recognised.

Pending a formal agreement with the EU on aviation safety, this will mean that many certificates and approvals will have to be renewed in one or other of the EU Member States, at considerable inconvenience and expense – assuming there is time. As it stands, there is considerable risk of major disruption, and a very strong chance that some businesses will be unable to function.

As to any formal agreement with the EU, this will have to be in the form of a Bilateral Agreement on Safety in Aviation (BASA) which, if the USA is any guide, will have to be a long and complex agreement, especially as we are starting from scratch.

Within any such agreement, Shapps can forget any idea of mutual recognition. The US and the EU rely on "equivalence". Any idea of mutual regulation is usually based on the adoption of US Federal Aviation Agency (FAA) standards.

In the future, it is unlikely that the UK will be treated any differently, which means that the UK will have to demonstrate that its rules and procedures have the same effect as the EU regime. And the chances of that happening to any substantial degree in the near future – or even by the end of the year – are precisely nil.

As we know, the industry body ADS estimated that it might take ten years to rebuild our regulatory capacity. But it has also put a price of £40 million a year for the venture, against a current contribution to the European agency of £1-4 million annually.

In the interim, British businesses will be forced to rely on the good offices of either EASA or the FAA for approvals and certification. But the irony is that, in September 2017, the CAA chief executive Andrew Haines was predicting that, should we leave EASA, "we should adopt the existing EASA regulatory system, rather than developing a new framework from scratch".

The end result of a great deal of turmoil and expense, therefore, might be that we end up with exactly the same system that we had before we left the EU. And as long as we are then locked into a BASA with the EU (and the US), there is no scope for any regulatory divergence. And nor would we want any. Aviation is a global industry and it would be entirely impractical for the UK to go it alone. What is coming over, therefore, is a sense that this government has vastly underestimated the complexity of dropping out of the EASA system, while substantially over-egging any gains from so doing.

That said, as long as it is the intention of the UK to avoid any commitments on regulatory alignment, there is no other option. We will have to go through a long, arduous and expensive process, in the knowledge that, for those enterprises which have survived the coronavirus crisis, life will be that much more expensive.

Eventually, given the tarnished reputation of the FAA over the Boeing 737-MAX affair, the UK may be able to carve out a regulatory niche, providing services for third countries such as Brazil. But the competition from European regulators will be strong, and they have a considerable head start.

The downside of that is that the aerospace sector in the UK, needing to work more closely with the regulator, might transfer much of its design and development, and its manufacturing, to EU Member States. But at least, we have taken back control. And we all know how much sense that makes.

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