Brazil to Sign Agreement Creating a Single South American Aviation Market

Brazil, Argentina, Chile and Paraguay will sign a memorandum of understanding in Asunción on Tuesday (14) to create a single aviation market in South America.

The agreement, known as ALAS (Air Liberalization for the Development of a Single South American Sky), gives the four countries up to 12 months to develop common regulatory rules that will gradually expand operating freedoms for airlines across the region.

The model follows the approach adopted by the European Union, allowing Brazilian airlines to operate in neighboring countries while permitting foreign carriers to operate domestic routes in Brazil on a reciprocal basis.

Brazilian law currently allows only airlines incorporated in Brazil to operate domestic flights, a restriction that has helped keep the market concentrated in just three carriers: Azul, Gol and Latam.

Under the proposal, a foreign airline would be allowed to carry passengers between two Brazilian cities provided the segment is part of an international route. At a later stage, that requirement would be eliminated.

The memorandum also provides for regulatory convergence among the participating countries and the mutual recognition of aviation certifications and licenses.

At the same time, Brazil's Ministry of Ports and Airports is expected to issue new guidelines for negotiating international air service agreements, covering authorized airlines, routes, flight frequencies and traffic rights between countries.

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