Etihad Airways (EY, Abu Dhabi International) last week signed a codeshare deal with Air Canada (AC, Montréal Trudeau), a move that has been greeted with some surprise given the previously frosty ties between Canada and the United Arab Emirates that arose over visa fees. The bilateral dispute originally stemmed from the UAE's discontent at Emirates (EK, Dubai International) and Etihad Airways (EY, Abu Dhabi International) being granted only 6 flights per week between them (to Toronto Pearson) by Transport Canada, the government regulatory authority. The two carriers lobbied to obtain rights to increase the frequency and number of destinations (including Vancouver International and Montréal Trudeau) against strong objections by Air Canada, and Transport Canada. When this failed, the UAE applied pressure in the form of exorbitant visa fees and other bureaucratic hurdles. However, earlier this month, the UAE scrapped the visa fee for Canadian citizens, two years after increasing it to USD250, thereby paving the way for Emirates and Etihad to get their desired daily services. Analysts expect the deal could pave the way for a liberalization of Canada's protectionist aviation policy regarding the granting of added frequencies to foreign airlines.