The Legal Impacts of COVID-19 in the Travel, Tourism and Hospitality Industry

6 Alitalia has been nationalised 15 , Germany is considering nationalising Condor after a deal with LOT to buy the airline collapsed due to the travel restrictions 16 , and the EU has relaxed State Aid rules 17 . In addition to treating airlines like essential air services by mandating routes stay open, the US CARES Act requires that airlines exchange warrants, an equity interest or debt in their companies in order to utilise the loan program 18 . Likewise in Europe, EU competition chief Margrethe Vestager recently advocated for the Member States to take stakes in companies in order to block Chinese takeovers 19 . At the same time, voices on the left are clamouring for nationalisation as a means to chart a course for a low-carbon future 20 . In many States, airlines will be fully or partially government-owned, making the response look like an atavistic move back to the Chicago/Bermuda model. Scenario four: A new beginning Finally, the fourth scenario is that we rethink things anew. The hardest thing about change in the aviation industry is that it is always in motion. As the old adage goes: you can’t change an engine whilst the aircraft is in flight. Fleets are grounded around the world, making this time very similar to the post-World War II environment. It is time to revisit anew the laws and policies that guide international air transport. States should further relax ownership and control provisions, allowing cross-border mergers. The focus should be placed on the aviation industry as an ecosystem, with concerns of airports and air navigation service providers receiving higher priority than only being relegated to the position of down-stream service providers in a supply chain. This might take a new competition lawmodel at the international level, focused on market structures rather than prices. Forward- looking digital technologies for passenger ticketing might also be marshalled to eliminate inefficiencies and maximise outputs. Environmental concerns should play a larger role in market structures. The grounding of fleets during the COVID-19 crisis will demonstrate that ICAO’s CORSIA is a mere window dressing on an industry that contributes substantially to increases in global warming emissions. Reactions 15 Thomas Pallini, “Italy just took full ownership of its national airlines Alitalia to save it from collapse amid the coronavirus. Here’s the carrier’s full troubled story” Business Insider (21 March 2020) https://www.businessinsider.com/alitalia-nationalized-by-italy-history-2020-3?r=US&IR=T 16 Klaus Lauer, et al, “Exclusive: Germany ready to nationalise airline Condor – sources” Reuters (1 April 2020) https://www.reuters.com/article/us-condor-nationalisation-exclusive/exclusive-germany-ready-to-nationalise- airline-condor-sources-idUSKBN21J5F9 17 Foo Yun Chee, “EU to ease state aid rules to help virus-hit companies” Reuters (17 March 2020) https://www.reuters.com/article/us-health-coronavirus-stateaid/eu-to-ease-state-aid-rules-to-help-virus-hit- companies-idUSKBN2141VC 18 David Hernandez, et al, “Coronavirus Aviation Industry Relief Legislation” The National Law Review (19 April 2020 ) https://www.natlawreview.com/article/coronavirus-aviation-industry-relief-legislation 19 Javier Espinoza, “Vestager urges stakebuilding to block Chinese takeovers” Financial Times (12 April 2020) https://www.ft.com/content/e14f24c7-e47a-4c22-8cf3-f629da62b0a7 20 Paris Marx, “Nationalize the Airlines” Jacobin (25 March 2020) https://www.jacobinmag.com/2020/03/nationalize-airline-industry-coronavirus-climate-emissions