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The U.S. and the European Union will resume talks Wednesday on further deregulating air traffic over the Atlantic Ocean, even as some U.S. lawmakers push legislation to reduce cooperation among international carriers.

The three-day session in Washington is expected to focus on U.S. and European laws that affect cargo and passenger carriers doing business on both continents. The U.S. will take aim at European restrictions on night flights and other regulations that officials say hurt cargo carriers such as United Parcel Service Inc. (UPS) and FedEx Corp. (FDX). The E.U., meantime, will continue its long push to loosen U.S. restrictions on foreign ownership and control of its airlines.

The talks are part of a series of meetings designed to expand an "open skies" pact that since March 2008 has allowed European airlines to operate flights to the U.S. from any city in the E.U. and vice versa. The meeting comes weeks after the Obama administration said it favored such treaties as a way to improve service and the health of the ailing airline industry.

But achieving the U.S.-E.U. goal of expanding their pact by the end of next year faces key obstacles, including strong opposition from labor unions and their backers in the U.S. Congress.

In May, the U.S. House overwhelmingly approved legislation that would place new limits on foreign investors' influence on management of an airline. The bill would also force airlines to unwind global alliances that allow them to cooperate on scheduling and revenue sharing, unless U.S. regulators acted. The measures have met opposition in the Senate, which has yet to act.

Luisa Ragher, head of transport, energy and environment for the E.U.'s European Commission in Washington, said the House bill would "do damage" to the open skies treaty.

"We still have a huge concern and we want to hear from the U.S. government" about prospects for the legislation, Ragher said. "It is very difficult to say where the administration stands."

Former President George W. Bush pushed for loosening restrictions on foreign control of airlines, but President Barack Obama has yet to reveal his leanings on that issue.

John Byerly, U.S. deputy assistant secretary of state for transportation affairs, who is leading the open skies talks, said working out such issues will be part of negotiating. "Our intention is to now hasten and intensify the pace of negotiating, get proposals...out on the table," Byerly said.

At the top of the U.S. agenda is resolving concerns about European regulations on noise and night flights. A German court ruling recently upheld restrictions on night flights at Frankfurt Airport to protect residents against air-traffic noise. Cargo carriers opposed the restrictions.

"The whole business model of FedEx and UPS is being able to pick up late in the day, fly to a hub at night" and make deliveries early in the morning, Byerly said.

Malcolm Berkley, a UPS spokesman, called the night-flying issue "critical."

"Any agreement without protective language regarding night flights is a concern that threatens our ability to operate," Berkley said.

He said the company backs a U.S. push for E.U. countries to use "balanced approach" when considering curfews and noise restrictions, conducting cost-benefit studies, for example.

The EU, for its part, is seeking to loosen U.S. restrictions that limit foreign ownership of U.S. carriers to 25%.

Both agendas face significant hurdles because they would likely require changes in U.S. and European laws.

Easing foreign-ownership restrictions faces skepticism from U.S. labor unions, who fear they could lose leverage if foreign investors gain influence, Byerly said.

Labor supporters in the U.S. Congress, including Rep. James Oberstar, D-Minn., the House Transportation Committee chairman, have sought to reduce cooperation among international airlines, not increase it, arguing that global alliances threaten competition.

Jim Berard, a spokesman for Oberstar, said the congressman's defense of the House bill would be "very strong," but that it would be difficult to predict the outcome of negotiations with the Senate, which could occur by the end of this year.

-By Josh Mitchell, Dow Jones Newswires; 202-862-6637; joshua.mitchell@dowjones.com