In 1999 liberalization of the air transport market in the EC has continued to have many positive results. As with US deregulation in 1978, it is clearly leading to growing consolidation, principally by way of alliances, and the Commission's ongoing investigation of the transatlantic airline alliances continues to dominate the agenda. For all its positive results, there is some question as to whether liberalization has been achieved at the cost of a deterioration in public service, despite the scope left by the 1992 third package for public service obligations. With the increased competition resulting from liberalization, airlines have come under pressure to cut costs. A prime target has been distribution costs, assisted by developments in technology. This is leading to differences in the relationship between airlines and travel agents and in the role of agents. In its communication on the European airline industry adopted in May 1999, the Commission made it clear that the completion of the single market in air transport with a genuine external dimension, particularly involving the US, is a priority. All these topical issues have been discussed at the Association's annual conference for 1999. The Association is grateful to TAP for its generous assistance with air travel to and from Lisbon.

1998 had seen further efforts by the European Commission to reduce the number of natural monopolies in the air transport market. The Council of the EU discussed a directive aimed at regulating airport practices by limiting the level of charges, putting an end to unfair practices and improving transparency for users. At the same time, the Commission set conditions on airline alliances after having carried out investigations into several alliances between EU and US carriers. Another significant issue in 1998 has been the review of conditions of carriage and tickets in consultation with the Commission and with consumer organisations, as well as the proposal for a revision of Regulation No. 895/91 regarding denied boarding compensation. Also in high profile during 1998 has been the proposal for a multilateral treaty between the EU and Eastern European countries regarding the adoption of the air law regime of the EU and EU competition law, which would create a common European aviation area. These various developments have provided the principal topics for discussion at the Association's annual conference for 1998. The Association is grateful to Austrian Airlines Osterreichische Luftverkehrs AG and Bank Austria Aktiengesellschaft for their generous contribution towards the cost of the seminar.