Abstract
The aviation industry is made up of the air transport; airport; air navigation services; and aircraft manufacturers industries as well as other business activities such as travel agencies and ground handling services. All these are at the cusp of exponential growth requiring adaptation to technological innovation, notably among which are codes that would greatly assist the efficiency of business processes. Blockchain—a relatively new technological initiative in the business process—promises “smart contracts” and is shaping modern business management in how businesses are managed and how value is created within enterprises, bringing to bear a distinct correlation between aviation and Blockchain. Inasmuch as the internet moves information and transmits the flow of data, Blockchain moves value which could assist industries in aviation to transact business faster; and improve tracking of passengers and freight while eliminating transaction costs. The networks based on Blockchain serve products and services better, making it a better tool for moulding the air transport product and enabling airports to become “smart airports”. As this chapter shows, Blockchain could be the platform in various areas of aviation and is insulated from deleterious hacking, thereby offering security and immutability.
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Notes
- 1.
Bitcoin is a cryptocurrency introduced by Satoshi Nakamoto in 2009 which is calculated to eliminate third parties such as banks and brokers from transactions. It is recognised as a form of electronic cash and is a decentralized digital currency without a central bank or single administrator and which can be sent from user to user on the peer-to-peer bitcoin network without the need for intermediaries. It is “an innovative payment network and a new kind of money”. See https://bitcoin.org/en/.
- 2.
In the 1964 case of Hedley Byrne v. Heller & Co the bankers for Hedley Byrne (an advertising partnership) telephoned the bank of Heller & Partners Ltd. inquiring about the financial state and credit record of one of Heller’s client companies, Easipower Ltd. Hedley Byrne was about to undertake some significant advertising contracts for them and wanted to be sure of their financial security. Heller vouched for their client’s record but qualified it by waiving responsibility, stating that the information was: “for your private use and without responsibility on the part of the bank and its officials.” Hedley Byrne relied on this information and entered into a contract with Easipower which went bankrupt soon afterwards. This case exemplifies the principle that had Blockchain existed then, the Bank of Hedley Byrne would have obviated the risk of being adversely affected by the negligent misstatement which resulted in economic loss. See [1964] A.C. 465.
- 3.
How Blockchain will Accelerate Business Performance and Power the Smart Economy, Harvard Business Review, 27 October 2017. See https://hbr.org/sponsored/2017/10/how-blockchain-will-accelerate-business-performance-and-power-the-smart-economy.
- 4.
Ibid.
- 5.
Advance Passenger Information (API) involves the capture of a passenger’s biographic data and other flight details by the carrier prior to departure and the transmission of the details by electronic means to the Border Control Agencies in the destination country. API can also act as a decision-making tool that Border Control Agencies can employ before a passenger is permitted to board an aircraft. Once passengers are cleared for boarding, details are then sent to the Border Control Agencies for screening against additional databases and can identify passengers of interest. While this technique is beginning to be used by more and more Border Control Agencies it has been used by a number of countries for some time. API has the potential to considerably reduce inconvenience and delays experienced by passengers as a result of necessary border processing. It also provides a system which carriers can use to comply with relevant legislation of the countries they fly to. See GUIDELINES ON ADVANCE PASSENGER INFORMATION (API), WCO/IATA/ICAO: 2013, at 3.8.
- 6.
See Dylus (2019), pp. 45–52.
- 7.
Iansiti and Lakhani (2017). See https://hbr.org/2017/01/the-truth-about-blockchain.
- 8.
Blockchain: How it Affects Legal Liability, Hogan Injury, at https://www.hoganinjury.com/ask-a-lawyer/.
- 9.
The International Air Transport Association (IATA) is the trade association for the world’s airlines, representing some 275 airlines or 83% of total air traffic. IATA supports many areas of aviation activity and helps formulate industry policy on critical aviation issues.
- 10.
Future of the Airline Industry 2035, IATA:2017 at 37.
- 11.
Id. 38.
- 12.
Blockchain in Aviation White Paper, IATA: October 2018, at 11.
- 13.
Id. 18.
- 14.
Ibid.
- 15.
Other travel industry initiatives are Aeron: a Blockchain for aviation safety; Loyyal—which reinvents the creation, reward and management of customer incentives; Ozone—an alternative distribution system for air transportation; SITA FlightChain—which is a partnership of SITA with some airlines and airports and is a shared ledger on flight information. It stores flight information and uses smart contracts to judge potentially conflicting information; TravelBlock—which offers an alternative to the Global distribution System; and TravelChain—which is an open source Blockchain managed by market players and travel industry partners.
- 16.
Airport Council International (ACI) World is a non-profit organization representing the world’s airports.
- 17.
Airport Digital Transformation – White Paper ACI, 21 October 2017, at 6.
- 18.
Id. 10.
- 19.
SITA, which is the world’s leading specialist in air transport communications and information technology, is a multinational company providing IT and telecommunication services to the air transport industry. The company provides its services to around 400 members and 2800 customers worldwide which it claims is about 90% of the world’s airline business.
- 20.
Kevin O’Sullivan, Blockchain in Air Travel, Blogs@SITA, https://www.sita.aero/resources/blog/blockchain-in-air-travel.
- 21.
Ibid.
- 22.
Accenture is a Canadian company which claims to solve their clients’ toughest challenges by providing services in strategy, consulting, digital, technology and operations.
- 23.
See Abeyratne (2005), pp. 255–268.
- 24.
Considerations About Cybersecurity In Aviation (Presented by Austria on behalf of the European Union and its Member States1, the other Member States of the European Civil Aviation Conference; and by EUROCONTROL), AN-Conf/13-WP/160, 28/9/18 at 12.
- 25.
Id. 3.
References
Abeyratne R (2005) The E-passport and the public key directory – consequences for ICAO. Air Space Law XXX(4–5):255–268
Dylus EP (2019) The international blockchain registry of mobile assets. Air Space Law 44(1):45–52
Iansiti M, Lakhani KR (2017) The truth about blockchain. Harv Bus Rev, January–February
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Abeyratne, R. (2020). Blockchain and Aviation. In: Aviation in the Digital Age. Springer, Cham. https://doi.org/10.1007/978-3-030-48218-3_6
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