'Open Skies' Deal Could Trim Cost of Air Fare

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The United States and the European Union have finally agreed to a long-awaited "Open Skies" pact.

When it goes into effect in March 2008, European and American airlines will be able to fly from any American city to any European city.

It should mean more flights to more places, and in the long run, cheaper tickets.

For more than 60 years, trans-Atlantic air flight has been bogged down with a stunning amount of red tape.

The U.S. has separate aviation agreements with every European country, giving each country's national carrier a lot of power to prevent other airlines from competing.

Next year, all U.S. and EU airlines will be free to fly anywhere they want in each other's territories.

Britain's Virgin Atlantic, for example, says it might offer flights from U.S. cities to Paris, Frankfurt, Amsterdam and Madrid.

Germany's Lufthansa could offer a regular London-New York flight.

British Airways had loudly fought the deal, because it wanted to maintain its dominance in Europe's biggest hub, the very crowded Heathrow in London.

But Europeans failed to get what they most wanted: the right to fly from city to city in the United States. There will be no Air France flights from New York to Los Angeles.

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