EU and US start 'Open Skies' aviation talks

BRDO, Slovenia, May 15 (Reuters) - The European Union and the United States launched talks on Thursday aimed at liberalising transatlantic aviation, closely watched by European airlines which are keen for greater U.S. access.

"The European Union has one clear political goal, we want to establish an open aviation area between the United States of America and the European Union," said Zoltan Kazatsay from the European Commission's Directorate for Energy and Transport.

"But how to reach this specific situation and when to reach it is another issue," he told a news conference.

The second round of "Open Skies" discussions builds on an agreement that came into force at the end of March, allowing carriers to access any U.S. city from any point in the EU and visa versa.

The move promises to increase competition between airlines, could cut ticket prices and may eventually pave the way for transatlantic mergers to create the world's first global airlines.

But significant hurdles still stand in the way, with Britain leading critics of the earlier agreement and calling for the abolition of U.S. federal laws that cap foreign control of U.S. airlines at 25 percent of the voting stock.

European airlines also want greater access to the U.S. domestic market, with the right to sell tickets for flights between U.S. cities.

But the U.S. said on Tuesday it would seek a wider deal by pledging to forego access restrictions on airlines from more than 60 nations. Kazatsay said, however, that the EU would "like to concentrate on the deepening of the existing agreement".

"We think that a broader multilateral initiative cannot replace the bilateral removal of this type of restrictions," he said.

C. Boyden Gray, the U.S. envoy to the European Commission, said that a lot of work would need to be put into persuading the U.S. Congress not to block the deal amid fears of possible takeovers of U.S. airlines.

"It's going to take a lot of work to persuade our congress that this is something that should be allowed, I don't think it's impossible to do at all but it will take generating public support in the United States and that is do-able but is not easy," Gray said.

British Airways (BAY.L) has been among the first to capitalise on the existing agreement, with plans for flights to the United States from Paris Charles de Gaulle airport on top of its traditional hub at London's chaotic Heathrow airport.

Meanwhile, rivals Air France (AIRF.PA) and Delta Air Lines (DAL.N) are planning to move on Heathrow in a joint venture they expect to generate $8 billion a year.

(Reporting by Marja Novak; editing by Elaine Hardcastle)