Talks collapse on EU-US-shared passenger information
The European Union and the US have failed to reach a deal on air passenger data, putting airlines at risk of huge fines or loss of landing rights.
American airlines demanded all inbound flights from Europe after 9/11 should provide personal passenger information.
The row has been ongoing since it was ruled in May that the subsequent deal was illegal. The efforts to seal a deal were given up last night.
Washington wants more power to distribute the details of EU passengers than the European Court is prepared to accept.
If EU carriers do not hand over the level of information Washington wants, they could lose landing rights at US airports. However, if they do hand it over they could face legal action.
A spokesperson for the EU Commission said the breakdown in talks had confusing legal implications.
"There is no agreement. There is a legal vacuum as of midnight tonight," EU Transport Commission spokesman Jonathan Todd said on Saturday.
In an interview with BBC television Mr Todd insisted talks would be ongoing and EU Justice Ministers will meet in Brussels on Thursday in a bid to resolve the problem.
However US Homeland Security Secretary Michael Chertoff denied the talks were over and said he did not believe European Courts would punish airlines if they continued to hand over sensitive information.
Personal details, including phone numbers and credit card numbers, have been handed over to US officials since the previous agreement was reached in 2003.
