U.S., Japan Reach Open Skies Pact

The United States and Japan have a new tentative agreement on an “open skies” aviation treaty that would give UPS new freedoms to add air service in competition with FedEx.

The pact is contingent on approval for Japan’s troubled international airlines to strike new joint ventures.

Japan Airlines and All Nippon Airways both need antitrust approval for operating agreements with foreign airlines, including U.S. carriers, as they cope with huge losses and heavy debt burdens.

FedEx is the dominant U.S. cargo airline serving the country, with UPS granted only limited rights under the highly restrictive treaty.

The countries reached the air services agreement late Friday after new talks in Washington aimed at bringing service parameters struck in 1952 into the modern era.

“Achieving open skies with Japan, a major U.S. transportation and trade partner, has been a longstanding U.S. goal, and is good news for air travelers and businesses on both sides of the Pacific," U.S. Transportation Secretary Ray LaHood said in a statement.

U.S. carriers have long sought a more open agreement with Japan but the countries were divided over Japan’s insistence on maintaining strict controls over access to Tokyo Narita International Airport. Japan eased its stance in the last round of talks, according to reports, agreeing to allow more flights for U.S. carriers.