A huge amount of business based on regulations, monopolies handed over by the State or sectors in which it is not easy to compete, the days pass in a state of alert. It turns out that no one knows, nor can, determine how far the president’s deregulatory imprint will go. Javier Miley.
In the world of transport, the warning light panel is on, at least in two of the most important for the transfer of passengers through Argentina. The long distance bus and the commercial airline market They are on the threshold of beginning a new time. How would it be? Unregulated, without having to go through bureaucratic desks to request authorizations or submit dozens of procedures that hinder competition. The main changes for the commercial airline market involve the elimination of authorizations to deliver a route. Any local airline can fly wherever they want.
As for the long-distance buses, which have transport capacity and meet safety requirements, for example, can provide services where they consider appropriate. It could be summarized that there will be much more freedom in the skies and on the routes. The question, as always, is how the market will react and whether this system could not generate an enormous concentration in large business groups, in addition to an eventual lack of connection with some destinations.
Eight days after publication, as established by law, the decree signed by the President remained in force. There is, of course, a chapter that is questioned by the Labor Justice and that has to do with all labor regulations. The rest governs.
In that standard there was a profound change in aviation legislation. For a few weeks now, a group of lawyers from insurance companies, advisors from that market and officials have been meeting in a commission that is trying to shape the regulations necessary for that standard to become operational. The conversations are usually remote, but faces were also seen at times in the offices of the Ministry of Transportation managed by Franco Mogetta from Córdoba.
There are some advanced topics; others that, for the sector, are disruptive. There is not much consensus on these and a discussion has begun. The agreement already exists to definitively advance the total elimination of public hearings as a requirement for airline companies to request routes.
This instance is still necessary and must be convened by the Government. During Kirchnerism there was one in 2005 and then never again, neither in Cristina Kirchner’s two years nor in the fourth term, headed by Alberto Fernández. Then, during the presidency of Mauricio Macri, another meeting was called in 2016 and all the routes requested by the companies that arrived, such as Flybondi o Norwegianlater bought by Jet smart. Since then, it has never been done again.
Now, those working on deregulation say, the procedures will be digitized and as long as the company meets the requirements demanded of an airline, it can fly wherever it wants.
Now, among these requirements there is one that divides waters. It is about maintaining the requirement for companies that make internal flights to have Argentine crew and planes registered in the country. That is, a company according to local laws.
But nothing is written or finished. There are not a few who consider that close to mercy They want to deregulate all the Argentine skies. That is, any company can come with a foreign crew and plane and serve an internal route. Such openness has several critics, even within the commission itself that works on the regulation of the DNU. That point remains to be seen and the big openers are not so optimistic.
The case of the buses
Another initiative that is taking shape is the deregulation of long-distance buses. The Government’s idea is that any registered company can go wherever it wants, without restrictions and without having to process any permit.
Currently, the exploitation of the routes is done through a precarious permit since these regulations have never been modernized. The basis of the system is that there are main routes, for example, between two cities, and the State, through regulations, requires that this bus have some services that enter the towns that are on the route. This standard is what generates connectivity, although it is not the most celebrated by transporters because it is not as profitable as the sections from one head to the other.
This scheme imposed by the State is based on the regularity and habitualityWhether there are passengers or not, whether it is high or low season, it still has to be complied with. In the sector they consider that, beyond the competition that could occur between companies for more profitable destinations, it is likely that a stage of disconnection between some cities will begin. The Government is not afraid of that assumption; They say that it will only be regulated and that some smaller ones will appear to do business with those shorter stretches.
Another of the topics to look closely at the labor regulations that the different types of long-distance carriers have. For example, minibuses or tourism services, those that organize trips for recitals or shopping tours, have collective agreements that are much cheaper than long-distance ones. Therefore, there are many who demand that everyone be made equal, and then yes, open the competition. It sounds logical, that everyone competes under the same conditions.
As an example, a case is worth: a long-distance bus has to have two drivers to go from Buenos Aires to La Plata while a combi travels with only one. That detail alone could take someone else who has a different collective agreement off the road. But beyond some consultations with the chambers and the transporters, the Government will move forward with the deregulation of buses and airplanes. It only remains to gauge how much the activity will open.