The term cabotage describes the operation of transportation services by a company that originates neither in the country of origin nor in the country of destination. Cabotage refers to both the transportation of goods and passengers.
Brief description
We speak of cabotage, for example, when a Czech carrier conducts a transport from Germany to Austria, because it originates neither in Germany nor in Austria. Cabotage occurs not only when the transport crosses a border, but also when the starting point and destination lie in a country from which the carrier does not originate.
To protect local markets, cabotage was often banned and prohibited. Inside the European Union, these regulations have been relaxed step by step to correspond to the main idea of free movement of goods.
