From ALPA:

"Cabotage would mean that a foreign airline does business in the U.S. domestic market subject to the laws of its own country rather than U.S. laws. If Air China were permitted to operate cabotage service, for example, it would be doing business in the U.S. domestic market as a Chinese business, subject to Chinese tax law, not U.S. tax law, Chinese labor law, not U.S. labor law, Chinese environmental law, not U.S. environmental law, etc. We don’t permit this in any other business sector: if Toyota wants to build cars in the U.S. it must set up a U.S. corporation to do so and have its U.S. plants be subject to U.S. laws; if Airbus want to build planes here it must do the same."

Cabotage service is not the answer | Pilot Partisan