Safety is always paramount. Many global standards are already in place, providing a ready-made framework for consolidation.
Governments conform to ICAO resolutions and performance is audited by ICAO and national programs, such as that implemented by the United States Federal Aviation Administration.
Aviation has also imposed its own global standard. IATA’s Operational Safety Audit (IOSA) is crucial in providing industry safety standardization and continuous performance improvement. IOSA is a requirement for all IATA members, and several governments including Bahrain, Brazil, Chile, Costa Rica, Egypt, Lebanon, Madagascar, Mexico, Panama, Syria, and Turkey have mandated IOSA in their national safety oversight programs. There are 348 air carriers on the IOSA registry, and in 2009 IOSA carriers’ safety performance was more than 44% better than that of non-IOSA carriers.
It has been argued that consolidation could lead to so-called flags of convenience. These are a source of controversy in the shipping industry, with Liberia and Panama leading the list of “open registration” countries. In November 2010, the Maritime Union of Australia asked its government to crack down on ships sailing under flags of convenience following an accident in Brisbane involving the Liberian-registered MSC Basel. The maritime sector has no single solution and countries usually ensure complicity with international law through Port State Control—a check against a graded blacklist.
In aviation, though, the global framework is growing in strength. ICAO’s Universal Safety Oversight Audit Program recently agreed to publish its results and IATA, ICAO, the US Department of Transportation, and the Commission of the European Union have signed a Memorandum of Understanding to create a Global Safety Information Exchange.
The joint recognition of safety standards by some governments provides further proof of robust regulation. For example, a Thai-registered Air Asia aircraft could form part of the Air Asia Indonesia fleet. In Latin America, Chilean crew and aircraft can form part of LAN’s Peruvian operations.