[Congressional Record Volume 145, Number 106 (Monday, July 26, 1999)]
[Senate]
[Pages S9302-S9303]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                   THE EUROPEAN UNION'S HUSHKIT RULE

 Mr. McCAIN. Mr. President, I support the amendment offered by 
Senator Gorton regarding the European Union's (EU) rule affecting 
hushkitted and re-engined aircraft. This Sense of

[[Page S9303]]

the Senate amendment will make clear to the Europeans that the United 
States will not tolerate unfair, discriminatory restrictions on trade 
that go against international principles and standards.
  For those who are not familiar with the issue, I will provide a brief 
background. To comply with international aircraft noise standards, the 
U.S. aviation industry adopted so-called hushkit technology to bring 
its older aircraft into compliance. Some airlines also purchased new 
engines for their older aircraft. Even though these hushkitted and re-
engined aircraft comply with the new international noise standard, the 
EU took legislative action to freeze the number of these aircraft 
within the EU Community at the 1999 level. Although the EU delayed 
final implementation of this rule for one year, this move has the 
effect of setting a more stringent noise standard in Europe.
  Unfortunately, implementation of this rule is likely to have a 
discriminatory and costly impact on the United States aviation industry 
without any noise reduction benefits. The fact that this rule does not 
have a similar effect on industries in the EU is troubling. It is my 
understanding that certain aspects of the rule were tailored to protect 
European aviation interests. But one of the worst aspects of this rule 
is the terrible precedent that it sets for unilateral action by 
countries or groups of countries outside of the established 
international standards-setting process.
  Earlier this year I wrote to European officials to express my deep 
frustration with their having chosen this particular, unilateral course 
of action to address the issue of aircraft emissions. Regulations such 
as the one at issue should be taken through the appropriate 
international channels, such as the International Civil Aviation 
Organization. Adoption of this rule by the EU has effectively breached 
a 50-year regime of global environmental rules in aviation.
  A regional rule such as this one will undermine the ability of 
lesser-developed nations, the aerospace industry, airlines, and the 
United States to work toward international standards for more stringent 
aircraft engine emissions, which is the purported rationale for the EU 
rule. I sincerely hope that the EU will come to realize the benefits of 
a single, rational aviation regime for all nations.
  The delay in implementation of the rule was granted as a result of a 
U.S. commitment to work in partnership with the EU within the 
established international process to develop a new, more stringent 
global aircraft noise standard. Since its adoption, the Federal 
Aviation Administration has been working bilaterally with 
representatives of the European Commission to develop an agreement to 
work in partnership on resolving this matter to everyone's 
satisfaction.
  Despite the ongoing consultations, and regardless of the delay in 
implementation of the rule, U.S. industry is being negatively impacted 
right now. Because the hushkit rule is on the books, the market assumes 
that the rule will eventually come into effect. This has had a profound 
impact upon many businesses. So it is important that this matter be 
resolved soon.
  The Europeans must understand how important it is that the 
considerations of the United States are taken into account with respect 
to this matter. If progress is not made in the near future, calls for 
taking strong action against the EU will grow. As a committed proponent 
of free trade, I am adamantly opposed to the EU rule. For the same 
reason, I do not support inappropriate retaliation on the part of the 
United States in this matter. Despite my opposition, however, the U.S. 
may in fact retaliate, which could do harm to businesses and consumers 
on both sides of the Atlantic.
  Whether retaliatory in nature or not, the U.S. has many tools at its 
disposal to address the matter if the EU proves to be intractable in 
its position. For example, the United States Trade Representative is 
considering preparation of a World Trade Organization case focusing on 
the discriminatory aspects of the rule. Northwest Airlines has filed a 
complaint with Department of Transportation asking for retaliatory 
measures. Most recently, the U.S. aviation industry has asked the 
government to take official action under the so-called Chicago 
Convention, which governs many aspects of international aviation, 
claiming that the EU rule is not in compliance with international 
standards.
  I do not want this issue to become the subject of a trade war. But if 
the EU fails to grasp the determined opposition of the U.S. aviation 
industry to this rule, there may be serious repercussions. I hope that 
this Sense of the Senate will begin to get the message to the EU that 
this issue cannot remain unresolved for too much longer.

                          ____________________