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Sports team charters free to take flight as airline spat resolved Add to ...

The National Hockey League emerged as the biggest winner from yesterday's meeting between Prime Minister Stephen Harper and U.S. President Barack Obama.

Mr. Harper announced after the meeting that a tentative deal had been struck to end a Canada-U.S. dispute over charter airline flights for sports teams.

"We think we're very close to resolving that," Mr. Harper told reporters.

The dispute began last month as a spat between transportation regulators in Canada and the United States. It quickly turned into a trade battle with both countries disallowing multiple stops by sports-team charters.

The issue was causing a nightmare for NHL clubs because they would not have been able to play more than one game in the United States or Canada without first returning to their home country.

This "creates a potential disaster for our team," Julien BriseBois, vice-president of hockey operations for the Montreal Canadiens, said in a court filing. The National Basketball Association and dozens of entertainers, including U2, were also affected.

The disagreement centred on the issue of "cabotage," which involves moving passengers between domestic cities in either country. Both countries generally forbid cabotage by foreign airlines, but sports teams had been given some exemptions because of the nature of their operations.

In August, U.S. transportation officials alleged Air Canada broke the cabotage rules for sports teams during several flights last year for the NHL's Boston Bruins and NBA's Milwaukee Bucks. Air Canada is one of the largest players in the sports-team charter business, serving 10 NHL teams, including all six Canadian-based teams, as well as the Bucks.

The U.S. Department of Transportation told Air Canada to drop all of its sports services. That prompted Transport Canada to retaliate by disallowing American carriers from making multiple stops in Canada. As a result, dozens of flights for upcoming NHL pre-season games were cancelled, along with several flights for the Toronto Blue Jays.

Last week, Air Canada sued U.S. Transportation Secretary Ray LaHood, alleging the U.S. action was "arbitrary, capricious, and contrary to law." Transport Minister John Baird also fired off an angry letter to Mr. LaHood protesting his department's conduct.

Under the tentative deal announced yesterday by Mr. Harper, the charter flights will resume as before for the upcoming sports season, and Air Canada will drop its suit. Both countries will still be able to investigate allegations of cabotage, but disputes will be handled through negotiation.

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