View source for Cabotage

{{Short description|Transport within a country by an operator from another country}}{{distinguish|Sabotage}}
'''Cabotage''' ({{IPAc-en|ˈ|k|æ|b|ə|t|ᵻ|dʒ|,_|-|t|ɑː|ʒ}}) is the [[transport]] of goods or passengers between two places in the same country. The term originally applied to shipping along coastal routes, port to port, but now applies to [[aviation]], [[railways]], and [[road transport]] as well.
'''Cabotage rights''' are the right of a company from one country to trade in another country. In aviation, it is the right to operate within the domestic borders of another country, particularly to carry passengers and cargo from one point in the other country directly to another point in the same country. Most countries do not permit aviation cabotage, and there are strict sanctions against it, for reasons of economic [[protectionism]], [[national security]], or [[public safety]]. One notable exception is the [[European Union]], whose member states all grant cabotage rights to each other.<ref>{{cite web |url=http://ec.europa.eu/transport/strategies/2001_white_paper_en.htm |title='European transport policy for 2010: time to decide' EU Commission White paper |publisher=Ec.europa.eu |date=2005-12-01 |access-date=2014-01-09 |url-status=dead |archive-url=https://web.archive.org/web/20120927035247/http://ec.europa.eu/transport/strategies/2001_white_paper_en.htm |archive-date=2012-09-27 }}</ref>
==Etymology==
The term "cabotage" is borrowed from French. It is derived from ''caboter'' which means "to travel along the coast". The origin of ''caboter'' is obscure: it may come from ''cap'' or ''cabo'' "cape", or it may refer to a type of boat. Attempts to link the word to the Italian explorer [[John Cabot|Cabot]] are not supported by evidence.<ref>{{Cite web |url = https://www.cnrtl.fr/etymologie/caboter |title=Centre National de Ressources Textuelles et Lexicales |language=fr}}</ref>
==In shipping==
Cabotage laws apply to merchant ships in most countries that have a coastline so as to protect the domestic shipping industry from foreign competition, preserve domestically owned shipping infrastructure for national security purposes, and ensure safety in congested territorial waters.<ref>{{cite web|title=Adherence to the cabotage system|url=http://www.naiko-kaiun.or.jp/e/union/union10.html|publisher=Japan Federation of Coastal Shipping Associations|access-date=26 December 2014|archive-date=26 December 2014|archive-url=https://web.archive.org/web/20141226093328/http://www.naiko-kaiun.or.jp/e/union/union10.html|url-status=dead}}</ref>
For the history of cabotage in UK law, see [[Navigation Acts]].
[[Indonesia]] implemented a cabotage policy in 2005 after previously allowing foreign-owned vessels to operate relatively freely within the country.<ref>{{cite news|title=Cabotage provides a big boost to shipping industry |url=http://www.thejakartapost.com/news/2013/09/23/cabotage-provides-a-big-boost-shipping-industry.html|access-date=26 December 2014|work=The Jakarta Post|date=23 September 2013}}</ref>
In the Philippines, the Tariff and Customs Code of the Philippines (Republic Act No. 1937) which is also known as the Cabotage Law restricts [[coastwise trade]] or the transport of passengers and goods within the country, to vessels with Philippine registry which has to secure a coastwise licence from the [[Maritime Industry Authority]]. After the passage of Foreign Ships Co-Loading Act or the Republic Act No. 10668 in 2015, foreign vessels with cargo intended to be exported out of the country may dock in multiple ports in the country before transiting to a foreign port.<ref>{{cite web|title=Beyond Republic Act No. 10668: Policy Considerations to Improve Coastwise Trade|url=http://industry.gov.ph/wp-content/uploads/2016/02/Beyond-Republic-Act-No-10668-Policy-Considerations-to-Improve-Coastwise-Trade.pdf|access-date=5 October 2017|publisher=Sector Planning Bureau of the Department of Trade and Industry|date=2015}}</ref>
China does not permit foreign flagged vessels to conduct domestic transport or domestic transhipments without the prior approval of the Ministry of Transport.<ref name="ukpandi">{{Cite web|url=https://www.ukpandi.com/-/media/files/imports/13108/briefings/33224---uk_legal_briefing_cabotage_web.pdf|publisher=UK P&I Club|title=Legal Briefing: A Quick Overview of Maritime Cabotage Regimes|date=August 2018|access-date=4 November 2021}}</ref> While Hong Kong and Macau maintain distinct internal cabotage regimes from the mainland, maritime cabotage between either territory and the mainland is considered domestic carriage and accordingly is off limits to foreign vessels.<ref name="ukpandi"/> Similarly, maritime crossings across the [[Taiwan Strait]] requires special permits from both the People's Republic of China and the Republic of China and are usually off-limits to foreign vessels.<ref name="ukpandi"/>
In the EU, rights to cabotage in newly admitted member states (in particular, Greece, Spain and Portugal) were restricted;<ref>[http://www.bloomsburyprofessional.com/uk/exceptions-from-eu-free-movement-law-9781849466202/ EU derogations]</ref> but this introductory provision was abandoned after criticism in the light of the [[MS Express Samina|Paros ferry disaster]].<ref>[http://www.greekislandhopping.com/Updates/updatepages/u_disaster.html Paros ferry disaster] {{webarchive|url=https://web.archive.org/web/20110120222458/http://greekislandhopping.com/Updates/updatepages/u_disaster.html |date=2011-01-20 }}</ref>
The [[Hague–Visby Rules]], a convention which imposes duties on maritime carriers, apply only to "carriage of goods by sea between ports in two different states", and thus do not apply to cabotage shipping.<ref>Hague-Visby rules, Article X</ref> However, section 1(3) of the UK [[Carriage of Goods by Sea Act 1971]] declares that the Rules "shall have effect … where the port of shipment is a port in the United Kingdom, whether or not the carriage is between ports in two different States …".
===United States===
In the United States, the [[Merchant Marine Act of 1920]] (Jones Act) requires that all goods transported by water between U.S. ports be carried on ships that have been constructed in the United States and that fly the U.S. flag, are owned by U.S. citizens, and are crewed by U.S. citizens and U.S. permanent residents. The [[Passenger Vessel Services Act of 1886]] states that no foreign vessels shall transport passengers between ports or places in the United States, either directly or by way of a foreign port.
A vessel satisfies the “U.S. built” requirement if:<ref name="ukpandi"/>
* “all major components of its hull{{efn|A component is “major” if it exceeds 1.5 percent of the vessel’s steelweight. A component is deemed part of the hull if it forms part of the watertight envelope of the vessel.}} and superstructure are fabricated in the United States”
*assembly of the vessel occurs “entirely in the United States.”
The requirements of the Jones Act apply to transport between:<ref name="ukpandi"/>
* all points in the territorial sea, within three miles of the coast,
* points in internal waters of the United States,
* the island territories and possessions of the United States.
* pursuant to the Outer Continental Shelf Lands Act, the requirements also apply to structures attached to the American outer continental shelf for the purpose of exploration, development, or production of natural resources.
==In passenger aviation==
Cabotage rights remain rare in passenger aviation. The [[Convention on International Civil Aviation|Chicago Convention]] prohibits member states from granting cabotage on an exclusive basis, which has limited the availability of cabotage as a bargaining chip in bilateral aviation agreement negotiations.<ref name="havel">{{cite book|last1=Havel|first1=Brian F.|title=The Principles and Practice of International Aviation Law|year=2014|publisher=Cambridge University Press|isbn=9781107020528|pages=50–53|url=https://books.google.com/books?id=C8H2AgAAQBAJ&q=chile%20cabotage&pg=PA50|access-date=26 December 2014}}</ref> Cabotage is not granted under most [[open skies]] agreements.
===European Union===
Carriers licensed under EU law are permitted to engage in cabotage in any EU member state, with some limitations.<ref>[http://ec.europa.eu/transport/modes/road/haulage/cabotage_en "Cabotage"] European Commission.</ref> [[Ryanair]], [[easyJet]], [[Vueling]], [[Wizz Air]], and [[Aer Lingus]] have bases and operate domestic services outside their home countries.
===Australia and New Zealand===
The [[Closer Economic Relations]] agreement allows Australian air carriers to fly domestically and internationally from [[New Zealand]] and vice versa. An Australian carrier, [[Jetstar]] (a [[Qantas]] subsidiary), flies domestic routes within New Zealand. [[Air New Zealand]] offers one international destination from Australia outside New Zealand, flying between [[Sydney]], Australia and [[Rarotonga]] of the [[Cook Islands]]. [[Air New Zealand]] also flies one domestic route in Australia, between [[Sydney]], Australia and [[Norfolk Island]], Australia. Previously, [[Jetconnect|Qantas Jetconnect]],  [[Pacific Blue Airlines|Pacific Blue]] (a [[Virgin Australia]] subsidiary) and [[Ansett New Zealand]] were Australian-owned airlines based in New Zealand that operated domestic New Zealand services.
Australia also permits foreign-owned airlines incorporated under Australian law (such as the domestic arm of [[Virgin Australia]]) to operate on domestic routes, although it prohibits such airlines from operating international routes as Australian [[flag carrier|flag carriers]]. They can, however still operate international routes if they are operated by an Australian-owned subsidiary.
===Chile===
[[Chile]] has the most liberal cabotage rules in the world, enacted in 1979, which allow foreign airlines to operate domestic flights, conditional upon reciprocal treatment for Chilean carriers in the foreign airline's country. This unusual regime is partly due to Chile's geographical need for air service, and partly to incentivize liberalization in other countries amid the international expansion of its flag carrier [[LATAM Chile]], which now has major operations in many other Latin American countries.<ref name="havel" /> Like Australia, Chile allows foreign companies to set up Chilean subsidiaries to offer domestic flights in Chile, regardless of reciprocity.<ref>{{cite web|url=http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:52005DC0406:EN:NOT |title=Communication from the Commission – Strengthening aviation relations with Chile |publisher=Eur-lex.europa.eu |access-date=2014-01-09}}</ref>
===Other examples===
Before 1991, [[Lufthansa]] was prohibited from flying to [[West Berlin]], so [[Pan American World Airways|Pan Am]], [[British Airways]], and [[Air France]] operated the routes between [[West Germany]] and West Berlin. For a short time in the late 1980s, [[Trans World Airlines]] also flew between then-West Germany and West Berlin. During this time, Pan&nbsp;Am flew to Tegel, in Berlin, from [[Munich-Riem Airport]] (now closed), Hamburg and Frankfurt. Air France flew from [[Düsseldorf]]. British Airways flew from [[Münster]]-[[Osnabrück]], [[Hannover]], and some other cities.
In 2003&ndash;2004, the [[United States Department of Transportation]] authorized [[Polynesian Airlines]] to provide temporary cabotage service in [[American Samoa]] after all US-flagged airlines ceased operations in the region, one of very few instances where the US has granted cabotage rights in an emergency.<ref>{{cite web|title=Cabotage definition and standards for emergency exemption|url=http://www.doi.gov/oia/igia/2011/upload/20-AviationCabotageDOT.pdf|publisher=U.S. Department of Transportation|access-date=26 December 2014}}</ref>
In October&nbsp;2007, the [[United Kingdom]] granted [[Singapore]] carriers the right to fly domestic UK&nbsp;routes as part of an [[open skies]] agreement, which also allows British carriers to fly to any city from Singapore.<ref>{{cite web|url=http://www.channelnewsasia.com/stories/singaporebusinessnews/view/303608/1/.html |title=Channelnewsasia.com |publisher=Channelnewsasia.com |access-date=2014-01-09}}</ref>
Reciprocal cabotage rights exist by treaty between New Zealand and Brunei, and between the People's Republic of China and Albania.<ref name="havel" />
In 2024, due to [[International sanctions during the Russo-Ukrainian War|western sanctions]] on its aviation industry, Russia sent cabotage proposals to "friendly countries" such as India and China, in the hope that airlines from these countries can operate domestic routes in Russia to mitigate its airplane shortage.<ref>{{cite news |last1=Majumder |first1=Arindam |title=Hit by mid-war turbulence, Moscow issues a mayday call to Indian airlines |url=https://economictimes.indiatimes.com/industry/transportation/airlines-/-aviation/hit-by-mid-war-turbulence-moscow-issues-a-mayday-call-to-indian-airlines/articleshow/114703326.cms?from=mdr |access-date=31 October 2024 |work=The Economic Times |date=29 October 2024 |language=en}}</ref>
== In road transport ==
The European Union allows limited cabotage for road transport. A non-resident carrier which has driven to another EU country is allowed to pick up and deliver a further load inside the host country before returning to the border.<ref>[http://www.europarl.europa.eu/factsheets/en/sheet/127/international-and-cabotage-road-transport International and cabotage road transport]</ref>
== Related concepts ==
==="Modified sixth freedom"===
The "modified [[freedoms of the air|sixth freedom]]" refers to the right to carry passengers between two points in country A through a hub in country B; for instance, a Boston-Toronto-Seattle itinerary.<ref>{{cite book|last1=Vasigh|first1=Bijan|title=Introduction to Air Transport Economics: From Theory to Applications|date=2008|publisher=Ashgate Publishing|pages=156–157|isbn=9780754670797|url=https://books.google.com/books?id=ZzPekWiS9I0C&q=qantas%20new%20york%20cabotage&pg=PA157|access-date=26 December 2014}}</ref> Such services are currently considered to constitute cabotage and are not permitted.<ref>{{cite press release|title=Canada's new government delivers greater Air Travel choice through Open Skies agreement with the United States|publisher=[[Government of Canada]]|date=12 March 2007|url=http://news.gc.ca/web/article-en.do?nid=283149|access-date=10 January 2014}}</ref> In 2002, the United States fined [[Asiana Airlines]] for selling tickets from the mainland US to [[Guam]] and [[Saipan]] via Seoul.<ref>{{cite news|last1=Compart|first1=Andrew|title=DOT fines Asiana for violating cabotage laws|url=http://www.travelweekly.com/Travel-News/Airline-News/DOT-fines-Asiana-for-violating-cabotage-laws/|access-date=26 December 2014|work=Travel Weekly|date=31 October 2002}}</ref>
===Tag rights===
Certain airlines operate services within a foreign country without the right to carry local traffic. For instance, [[Qantas]] operates service between New York and Los Angeles solely for use by international connecting passengers. Such services are not generally considered to be cabotage.
==Notes==
{{notelist}}
==References==
{{reflist}}
==External links==
*[https://web.archive.org/web/20110101022429/http://ec.europa.eu/transport/rail/packages/2007_en.htm European Commission > 3rd railway package including cabotage]
*[https://okiemtruckera.pl/blog/kabotaz-i-transport-kabotazowy/ What is the meaning cabotage?]
*[https://web.archive.org/web/20120927035247/http://ec.europa.eu/transport/strategies/2001_white_paper_en.htm "European transport policy for 2010 : time to decide" European Union Commission White paper]
[[Category:Business terms]]
[[Category:Political terminology]]
[[Category:International law]]
[[Category:International trade]]
[[Category:Freight transport]]
[[Category:Civil aviation]]