ABSTRACT
The limiting of airlines designated to operate services to the US from Heathrow has proved most beneficial to the two UK nominated carriers, British Airways (BA) and Virgin Atlantic. A significant difference can be observed between the way routes and traffic develops with and without an "Open Skies" agreement. "Open Skies" removed restrictions on capacity, fares, routings and the number of airlines each country could designate. The proportion of UK-US passenger traffic accounted for by British Airways (BA) and Virgin Atlantic (Virgin) is significantly higher than that of the six US carriers providing transatlantic services. With UK airlines accounting for nearly 60" of the scheduled passenger traffic between the two countries, the incentive to radically alter the terms of the bilateral from the British perspective has not been overwhelming. In US Department of Transportation (DoT) report published in October 2000 transatlantic airfares were shown to have fallen considerably as a result of "Open Skies".
