Cabotage rights remain rare in passenger aviation. The
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. Cabotage is not granted under most
open skies agreements.
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. Previously,
Qantas Jetconnect,
Pacific Blue (a
Virgin Australia subsidiary) and
Ansett New Zealand were Australian-owned airlines based in New Zealand that operated domestic New Zealand services. Similarly,
Air New Zealand operated two domestic routes in Australia, between
Sydney &
Brisbane, Australia and
Norfolk Island, Australia; this was suspended due to Air New Zealand staffing issues related to COVID-19 border closures in 2021, being taken over by Australian carrier
Qantas, initially on a temporary basis, but ongoing as of 2025. 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 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.
European Union Carriers licensed under EU law are permitted to engage in cabotage in any EU member state, with some limitations.
Ryanair,
easyJet,
Vueling,
Wizz Air, and
Aer Lingus have bases and operate domestic services outside their home countries.
United States Foreign-registered aircraft are prohibited from carrying passengers or cargo between points in the US, except as part of a through trip involving travel to or from a foreign point. In order to fly between points within the US, at least one leg of the trip must be booked on a US airline.
Other examples Before 1991,
Lufthansa was prohibited from flying to
West Berlin, so
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 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 2003–2004, 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. In October 2007, the
United Kingdom granted
Singapore carriers the right to fly domestic UK routes as part of an
open skies agreement, which also allows British carriers to fly to any city from Singapore. Reciprocal cabotage rights exist by treaty between New Zealand and Brunei, and between the People's Republic of China and Albania. == In road transport ==