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“Our role is to maintain and monitor a
framework in which fair competition can
flourish”
– Arthur LevittJnr
Do the discount of airport charges and other similar
incentives for a few select airliners at airports promote
anti-competitive conducts?
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Public Air Law
Effects of Airports Charges on Fair
Competition
Leiden University
Air & Space Law
Adewale Mobolai B. (s1779591)
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Abstract
This paper provides a comprehensive overview on airport
charges. Starting with discussion of whether airports are
natural monopolies or if they face real competition, It further
goes on to ascertain if the discounts and incentives offered to
a few select carriers on airport charges, most times to
prevent airport switching and further increase commercial
revenue as opposed to maintaining their dominant position,
affects fair competition and promotes anti-competitive
conducts. The directives enacted by the European Union on
airport charges will be reviewed and also the instruments put
in place by these regulations to curb or prevent anti-
competitive conducts.
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Table of Contents
1. Introduction………………………………………………………………………….… 5
2. Airport Regulations……………………..…………………………..…………….. 7
3. Airport Competition…………….…………………….…………….…………… 11
4. Cases………….………….……………………….……………………………………… 15
6. Conclusion……………………..…………………………………………………….… 18
1.Introduction
The aim of this paper is to analyse the effectiveness of the European Union
Airport Charges Directive (2009/12/EC) (hereafter "EU Airport Charges
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Directive") in dealing with possible discrimination in the airport sector in
relation to airport charges. It should be borne in mind that, from the onset and
for a long time, airports have operated as natural monopolies; this scenario
began to change with the deregulation of airports which has led to changes and
diversity in ownership models for European airports such as, privately owned
airports or a joint partnership structure between the government and private
institutions and also as a public company. This new airport policy has changed
the way airports relate to each other as well as their relationship with the
airlines, especially after the introduction of the liberalization of air services that
fostered competition in aviation and put pressure on the airports to improve
their performance
This has led to a sort of competition between airports as they have to compete
amongst one another on price and service quality in order to retain and attract
the traffic they need, as both airliners and passengers are now “footloose”,
which is not helped by the fact that over 60% of the European population live
within two hours’ driving time of at least two airports, aligned with the growth
in numbers of direct routes served by airlines, which provides higher consumer
choice.1
Airport competition is limited and probably distorted by the wide
range of regulations it is subjected to which include the regulations enacted by
the European Union aimed at levelling the playing field in the airport sector.
Airport charges are paid by airlines for the use of airport facilities.2
They include
aircraft landing, freight and other charges related to the use of airport
infrastructure such as runways and passenger terminals. Ultimately these
charges are paid, indirectly, by passengers and freight customers via the ticket
price or freight forwarding fee. Airport charging systems are in many instances
imposed or otherwise regulated by national authorities. Even where the
airports concerned are privately owned, the charges have to comply with the
rules by the authorities.3
Many airports offer discounts as an incentive to grow
their network and attract new airlines. Nonetheless, there are some situations
in which incentives can discriminate between airlines –
1 J. Wiltshire,IATA Economics Briefing No 11: Airport Competition, November 2013
2 Charges are levied based on the weight formula being Maximum Take-Off Weight (MTOW) as indicated in
certificateof airworthiness asa basisfor assessment.
3 European Union, Mobility and Transport,Air charges
<https://ec.europa.eu/transport/modes/air/airports/airport-charges_en>accessed 14th November, 2016
6 | s 1 7 7 9 5 9 1
 when incentive schemes are not open to all carriers,
 benefit only a limited number of users
 And are funded by thoseairlines that do not benefit from them.
In such a situation, incentives and discounts distort competition between
airlines and are detrimental to users who do not benefit from them.4
Given the broad scope of EU Competition Law5
, the policy-makers in Europe
may choose either to impose a strict price regulation on the airports or simply
rely on the application of Article 102 when it is a dominant airport. Yet even
the application of EU Competition Law has to take account of the particular
features of the industry, such as issues related to market definition, the
countervailing buyer power of the airlines and the economic incentives
provided by the commercial activities in the airport area.
First the author examines how the European airport industry is regulated and
then goes on to describe how the airports compete and what kind of obstacles
may be hindering the competitive process.
2.Airport Regulations
Airport regulations were originally established in Article 15 the Chicago
Convention6
, in 1944, in the guidelines from the International Civil Aviation
4 IATA, Charges,Discounts and Incentives < https://www.iata.org/policy/Documents/charges-discounts-
incentives.pdf > accessed 14th November, 2016
5 European Union, Consolidated version of the Treaty on the Functioningof the European Union (13 December
2007) , 2008 O.J. C 115/47
6 Chicago Convention on International Civil Aviation (Chicago,7 Dec. 1944) 15 U.N.T.S. 295, entered into force 4
April 1947,art15
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Organization (ICAO) laid down in 1947. The Convention's rules were binding on
the signatory states and governed sensitive areas such as discrimination against
foreign airlines, whereas the ICAO's rules concerned best practices and were
designed to provide a harmonious relationship between the airlines and
airports.
In 1974, ICAO’s document 9082/7 - Policies on Charges for Airports and Air
Navigation Services which contained the recommendations and conclusions of
the Council resulting from ICAO’s continuing study of charges in relation to the
economic situation of airports and air navigation services provided for
international civil aviation was published. States are encouraged to incorporate
the four key charging principles of; 7
 Non-discrimination: Charges must be non-discriminatory both between
foreign users and domestic users and between any two or more foreign
users
 Cost relatedness: The charge is related to all the costs of operating the
airport and its ancillary services. As a general principle it is desirable,
where an airport is provided for international use, that the users shall
ultimately bear the full and fair shareof the costof providing the airport.
 Transparency: Airports should maintain accounts that provide
information adequate for the needs of both airports and users, and that
the facilities and services related to airport charges are identified as
precisely as possible, should publish their financial statements on a
regular basis, and should provide appropriate financial information to
users in consultations.8
 Consultation with users: Consultation between operators and airlines
implies discussion of proposed charges, which should be notified a
minimum of two months before the increase is due to take effect. This is
not a negotiation, where no agreement can be reached by both parties,
airport operators are free to impose charges at the level they deem
necessary.
7 Prof. Dr. P. Mendes de Leon, Public Air LawReader 2016-2017,pg. 335
8 Guidanceon accountingcontained in the Airport Economics Manual (Doc 9562) may be found useful in this
context, although there are other approaches.
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Into their national legislation, regulation or policies, as well as into their future
air services agreements, in order to ensure compliance by airport operators
and air navigation services providers (ANSPs). The most recent of the above
document was published in 2012 and is the 9th
edition, which confirms a
constant effort by ICAO to review the document and keep it up to date with the
latest developments in the aviation industry. There may be separate sets of
airport charges for domestic and international flights at international airports
and domestic airports.
The European Union has traditionally been involved in airport policy, for
example, the Council Regulation (EEC) 95/93 of 18 January 1993 on Common
Rules for the Allocation of Slots at Community Airports and the Council
Directive 96/67/EC of 15 October 1996 on Access to the Ground Handling
Market. A need for a directive targeting airport charges specifically arose from
the existence of multiple frameworks applied in the different Member States
that could have threatened fair competition among airlines using European
airports.9
On 24 January 2007, the European Commission proposed an initial
legislative document whose purpose was to set up common principles for the
levying of airport charges at European airports under the form of a Directive of
the European Parliament and of the Council. The Directive 2009/12/EC of The
European Parliament and of The Council of 11 March 2009 (“The Directive”)
was established with explicit reference to ICAO’s Policies on Charges for
Airports and Air Navigation Services (Doc 9082).10
The final legislative act was
adopted on 11 March 2009 by the Council, which approved all amendments
voted by the European Parliament.
The European Commission initially proposed that the Directive be applied to
any European airport whose traffic is over 1 million passenger movements or
25,000 tonnes of cargo, or which accounts annually for more than 15% of the
passenger movements in the Member State in which it is located. But the
European Parliament and the Council decided to subject to the Directive all
European airports whose annual traffic is over 5 million passenger movement
9 ICAO CaseStudy on Commercialization,Privatization and Economic Oversightof Airports and Air Navigation
Services Providers,Directive2009/12/EC of the European Parliamentand of the Council of 11 March 2009 on
Airport Charges,28 January 2013
10 Like the ICAO, the Directiveonly sets out principles thatmust be embodied in national law.
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and to add the largest airport in each Member State.11
The Directive applies to
all airport charges apart from the provision of air navigation and ground
handling services which are already subject to Commission Regulation (EC) No
1794/2006 and CouncilDirective 96/67/EC respectively.12
The Directive looked to emphasizethe following points;
 Prohibition of discrimination among airport users. This does not prevent
the modulation of airport charges for issues of public and general
interest, including environmental issues. The criteria used for such a
variation shallbe relevant, objective and transparent.
 Charges must be set in Transparent fashion and must be open and clear
to anyone inquiring about the charge.
 The level of airport charges may vary in accordance with the tailor-made
services provided and airport operators have access to them on a non-
discriminatory basis.
 Member states must establish procedures for resolving disagreements
between the parties
 EU Member states must establish an independent supervisory authority
(ISA) to guarantee the execution of The Directive once ratified into
national law.
The scope of Directive 2009/12/EC is restricted to procedural matters that
affect the economic regulation of airports
ISA functions have been granted to the national Civil Aviation Authorities,
which are already in charge of several aviation matters in Member States.
Some countries have instead granted ISA functions to existing independent
regulators (Belgium, Luxembourg) or competition and regulation commissions
(Netherlands, Estonia, Ireland). In Denmark, Finland and Sweden the national
transport authorities now have ISA functions. Finally in Germany, federal
governments retain competence over regional aviation and as such they have
been designated as the ISAs, while referring to the central Ministry for policy
11 Directive2009/12/EC was expected to affect 150 of the EU's airports by the time that it came into force
(Marques and Brochado,2008).
12 Security charges arealso beyond the scopeof Directive 2009/12/EC as they were the object of another
Directiveproposal in 2009.
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matters. In Italy, no ISA has been formally appointed – the CAA (ENAC) is
performing its functions temporarily as part of its regulatory activities.13
No
Member States have “established” an ISA ex-novo, but rather they have
assigned its functions to existing entities. The level of activity at ISAs has been
low, with respect to the specific functions contemplated by the Directive.
However several ISA representatives have been involved in consultation
sessions in their respective Member States. These meetings took place either
as part of the reformulation of economic regulatory measures in some Member
States (UK, Ireland) or as part of the annual consultation mandated by the
Directive (Czech Republic, Romania).14
3.Airport Competition
Competition, as defined by the OECD (1993), is "a situation in a market in which
firms or sellers independently strive for the patronage of buyers in order to
13 The European Commission recently issued a formal noticeto the Italian government for failures in
implementing the EU AirportCharges Directive(2009/12/EC). With infringement procedure 2014/4187 (still in
its pre-litigation phase) the commission contested the consultation procedurethat aimed to regulate charges
at five major Italian airports (Fiumicino and Ciampino in Rome, Malpensa and Linate in Milan and Venice
airport) through contractagreements between airportmanagement and the Italian Civil Aviation Authority
(ENAC).
14 S. Gleaves, Evaluation of Directive2009/12/EC on airportcharges 75 (2013)
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achieve a particular business objective, e.g., profit". Competition between
airports can take many forms but it ultimately occurs in two areas: pricing and
services. First, they compete to attract airlines; then they attempt to attract
other service providers that may or may not compete with their other services
(ground handling and commercial).15
In a report by ACI Europe, the following methods were listed as the ways which
airports compete amongstthemselves;16
 Competition to attract new airline services (passengers and freight); by
stressing the quality of the infrastructure and the attractiveness of their
amenities to the passengers served by the airlines and also granting
discounts on the cost of landing and taking off. For example Brussels
citing Charleroi as their main competitor, Amsterdam citing Brussels,
Lisbon citing Madrid, Malmö citing Copenhagen and so on for new low
cost carriers (LCC)
 Competition between airports with overlapping hinterlands; Airports in
the same cities, such as Heathrow and Gatwick which are airports
situated in London with a similar amount of time to be accessed by
passengers and similar costs.
 Competition for a role as a hub airport and for transferring traffic
between hubs; this are airports that have a large amount of transfer
passengers.17
Other examples are Liège and Cologne competing to be the carrier hub for
express parcels; the Frankfurt Hahn and Stockholm Skavsta competition for
being the aircraft base for low-cost carrier as with Liverpool and Manchester;
Also Munich and other larger German airports competing to be the second hub
for Lufthansa - the list identifies alternatives open to the airline, whether or not
any formal competition by the airports in question took place. In fact,
Manchester Airport did not have the margin of unused capacity that might
15Dr. P. Morrell,Airportcompetition or network access? A European perspective (2010)
16 ACI Europe, European airports:a competitive industry Policy paper submitted by the Airports Council
International (ACI) Europe Policy Committee (2009)
17 The listis notexhaustive.In the book Airport Competition; The European Experience (2010), written by Dr. J.
P. Forsyth a longer listis given.
12 | s 1 7 7 9 5 9 1
have motivated it to seek low-cost airline services. The same would have
applied to Düsseldorf Airportin relation to Lufthansa’s second hub.18
Competition law can be broadly defined as the rules that guide the
Government's intervention to stop or prevent anti-competitive conduct and
preserve competition in the markets with the aim of enhancing economic
welfare. The way competition law is enforced is constantly evolving as it is
influenced by political, economic and institutional factors.19
When the EU Competition Law is applied to deal with an abuse of dominance in
the airport services, there is likely to be opposition to the Commission's
decision on the grounds that there already exists regulators established by
National law as directed by Directive2009/12/EC, with one of the aims being to
promote Fair competition and with the ability to permit or block a particular
form of conduct. This issue was addressed in the dispute between the
Commission and Deutsche Telekom20
(DT) in which the latter was accused of
adopting a margin squeeze system of pricing to the detriment of its
competitors. In its decision, the Commission found that the DT had abused its
dominant position by charging prices for access to its network that were even
higher than it charged to its own subscribers in the downstream retail market.
DT defended itself by arguing that its fees had been approved by the German
regulator and that any legal action should be taken against Germany under
Article 258, TFEU (formerly Article 226, TEC). The Commission was of the view,
backed by the case-law, that the "competition rules may apply where the
sector-specific legislation does not preclude the undertakings it governs from
engaging in autonomous conduct that prevents, restricts or distorts
competition".
The General Court upheld the Commission's decision by stating that DT could
only have escaped prosecution under Article 102 if the anti-competitive
conduct had been required by national legislation or if the latter had created a
legal framework which in itself precluded the possibility of competition. The
decision went even further by holding DT responsible for not correcting its
18 See Forsyth, supra note 17, at 16
19 G. Monti, EC Competition Law (2007)
20 Commission Decision N.2003/707/EC, OJ L 263/9 2003
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conduct when the German regulator had failed to recognize its anti-
competitive effects.21
Although the DT case has not received a final word from the ECJ, the Court is
expected to decide in favour of the Commission. This is due to the
constitutional status of the Treaty that gives competition provisions prevalence
over national law, even when the latter has been set out in response to an EU
Directive.
Article 102 TFEU(formally 82 TEC) describes an abusivedominant position;
Any abuse by one or more undertakings of a dominant position within the internal market or in a
substantial part of it shall be prohibited as incompatible with the internal market in so far as it may
affect trade between Member States.
In the United Brands v. Hoffmann-La Roche case(1978), the European Court of
Justice (ECJ) offers definitions of a ‘‘dominant position’’ and of the ‘‘abuse’’ of
such a position, which are still used today;
“[A] position of economic strength enjoyed by an undertaking which enables it to prevent effective
competition being maintained on the relevant market by giving it the power to behave to an
appreciableextent independently of its competitors, customers and ultimately of its consumers”
In the ECJ’s decision, dominance is defined as the power to behave to an
appreciable extent independently of the behaviours of others. However,
European competition law does not impose sanctions on the dominant position,
per se, but only its abuse.22
In the same case the ECJ portrayed abusive conduct
as behaviour which, through recourse to methods different from those which
condition normal competition in products or services on the basis of the
transactions of commercial operators, has the effect of hindering the
maintenance of the degree of competition still existing in the market or the
growth of that competition. Although Article 102 provides some examples of
abuses, the list is not exhaustive.
For the liability conditions of Article 102 TFEU to apply, the airport must have a
substantial share of the internal market. The General Court ruled in Aéroports
21 CaseT-271/03, Deutsche Telekom AG v Commission,C 128, 29, 24/05/2008, Paragraph 86
22 The ECJ confirms a findingthat an undertaking has a dominantposition is notitself a recrimination butsimply
means that, irrespectiveof the reasons for which ithas such a dominant position,the undertaking concerned
has a special responsibility notto allowits conductto impair genuineundistorted competition on the common
market (NV Neverlandsche Banden-IndustrieMichelin v.Commission,1983).
14 | s 1 7 7 9 5 9 1
de Paris (ADP) v Commission23
that this requirement should be assessed in
terms of the size of the undertaking and volume of passengers that use the
dominant airport in comparison with the airport capacity that exists in the
European Union.24
The first step in determining whether an airport has a dominant position is to
determine in which market, judged by its products and geographical
dimensions, its competitors are capable of promoting effective competition or
constraining the airport's conduct. Once the boundaries of this market have
been determined, it is necessary to calculate the market share of the
competitors to make a preliminary assessment of their degree of dominance.
The regulatory and competition authorities have relied heavily on examining the
overlap of arbitrarily-defined catchment areas to define the number of airports
within a certain drive-time.
As mentioned by the UK Competition Commission in its "Working paper on
market definition" (2009), the demand for airport services is derived from the
demand for air transport. Hence a change in price or quality of airport services
can affect the demand in two, possibly cumulative, ways:
 By inducing a direct airline to replace its current airportwith another;
 By affecting the airline's prices and indirectly inducing passenger to
switch to another airline and/or airport.
4.Case Law
23 CaseT-128/98 [2000] ECR II-3929
24 It should be mentioned though that a national courtor NCA is not bound by a previous findingof dominance
by the Commission
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A large part of case law in its application to airports has been based on State
Aid, such as State Aid No. C 12/08 (ex NN 74/07), Agreement between
Bratislava Airport and Ryanair; State aid No N 27/2008 – United Kingdom Aid of
a Social Character Air Services in the Highlands and Islands of Scotland
(prolongation of N 169/2006 and several similar cases, but the focus here will
only be on the cases where the abuse of dominance under Article 102 was
brought into question. Remarkably, there have not been many investigations
by the Commission aimed at revealing abusiveprices charged by the airports.25
In a case against Brussels-Zaventem Airport26
in which British Midlands Airways
complained that a discount system based on the volume of traffic, put the
small carriers at a competitive disadvantage and did not have any objective
justification. As part of their assessment, the Commission ruled that the
airways authority (the public body responsible for managing the airport and
setting its prices) was a public undertaking to which was given exclusive rights
under the provision of Article 106(1). In addition, the decision declared that the
airport's position as the eleventh busiest airport in the internal market in terms
of passenger movement and the fifth busiest in terms of freight made it a
substantial part of the common market. Having proved its undertaking liability
under Article 102, the Commission analyzed the following arguments brought
forward on behalf of the defendant:
 the right of an undertaking to introduce a system of reductions as part of
its commercial policy,
 the right to grant larger discounts to loyal customers, particularly in view
of the financial security they provide,
 the economies of scale by which it costs less (in terms of administration
and staff) to supply services to a national carrier with a large volume of
traffic at the airport,
 The airport is made more attractive when there is a national carrier
offering an extensive network of destinations (paragraph 16).
The first two arguments were rejected by referring to the "special
responsibility" doctrine (Case 322/81 Michelin v Commission [1983] ECR 3461,
25See Commission Decision SA.23324 —C 25/07 (ex NN 26/07),25/07/12
26 Commission decision 95/364/EC OJL 216, 12/09/1995
16 | s 1 7 7 9 5 9 1
paragraph 57) that the dominant undertaking must not to impair competition
even further (as had been the case with regard to the loyalty-inducing rebates).
The Commission argued that the defendant had failed to prove that there were
economies of scale since the services provided were the same, regardless of
how often they were supplied and it dismissed the idea that the concentration
of flights by the national airline would have the effects that had been alleged.
In assessing the merits of the case, the Commission interpreted the
undertaking's conduct as demonstrating discriminatory abuse and following the
reasoning adopted in the Corsica Ferries II (Case C-18/93 [1994] ECR I-1783),
decided that, by acting through an intermediary, The Kingdom of Belgium had
benefited the national airline. The discount system was found to be in breach
of Articles 102 and 106(1), formerly Articles 86 and 90 (1) of the EC Treaty.27
On a national level, price undercutting has been found by an investigation
carried out at Stansted airport28
. Luton airport made a complaint to the British
regulator (CAA) that Stansted was levying very low charges and this caused
Ryanair to transfer its services. Stansted confirmed that the charges were
below its costs but justified its conduct on the grounds that the airport was
relatively new and was still seeking to recover its initial operating costs. It also
argued that the airport's revenues were still above the average avoidable costs
and thus it could not be accused of being engaged in predatory pricing. After
examining the Stansted figures, the CAA admitted that discounts were below
costs and could not be matched by Luton. However, the regulator found itself
in a situation where it was bound by the airports policy (which allowed an early
expansion of Stansted) and stated that:
"Luton has been materially harmed but that harm stems from the Government's decision in 1985 that
the next significant tranche of airport capacity to serve the South-East should be at Stansted ... For the
Authority to find that the policies Stansted has pursued…. should be inhibited or reversed because of
their effect on Luton would be tantamount to saying that the decision to develop Stansted was wrong"
(paragraph 61).29
In the end, the CAA concluded that no remedy was feasible under its statutory
discretionary powers to impose a price monitoring framework on the airport.30
27 See Commission Decision 1999/199/EC OJL 069, 16/03/1999 0031-0039
28 It was a sector-specific investigation as theCAA does not have the power to enforce EU Competition Law
29 D. Starkie,Testing the Regulatory Model: The Expansion of Stansted Airport 397 (2004)
30 See S.41(3)(c) of the Airports Act (1986)
17 | s 1 7 7 9 5 9 1
Unfortunately, the case was not analysed by the Monopolies and Mergers
Commission (the predecessor of the Competition Commission) and there was
no additional information available to verify whether or not the airport had
been guilty of predatory pricing.
5.Conclusion
In 2013 the Commission carried out a study and subsequently presented a
report in 2014 on the application of the Airport Charges Directive by the
Member States. In this report the Commission noted that whilst some
18 | s 1 7 7 9 5 9 1
positive results can be identified in terms of increased transparency of
airport charges, more needs to be done to ensure the consistent application
of the Directive in the EU. It should be understood that though this
directive has made some improvements, it still isn’t yet as effective as
airliners are still complaining about the charging powers of the major
airports such as the UK’s Heathrow Airport, which has some of the highest
charges globally, upset airlines with plans to raise charges per passenger
from GBP21.96 to GBP27.30 over a five-year period (almost 6% over
inflation), which it claimed to be necessary to support its ongoing GBP3
billion investment programme. Those charges paid by airlines constitute
the biggest single source of income for Heathrow Airport, raising GBP1.3
billion for Heathrow in 2012. 31
The above is to the detriment of airports in the same catchment area with
Heathrow, such as Gatwick Airport and Stansted, as they are restricteed by
the Directive and ISA’s from also increasing their airport charges which
creates an unfair market for them as they cannot grow economically with
preference being given to the main airport. Amongst other reforms, it is
advised that the commission should move its focus to the largest Airports in
a catchment area, as it is definitely clear airports are no longer natural
monopolies, so as their business does not kill the growth of the smaller
Airports who are restricted from increasing charges and thus cannot
improveservicesbeing provided by them to airliners.
Bibliography
International Laws and Treaties
31 CAPA Centre For Aviation, Airport charges:EC reports increased transparency in settingcharges,but uneven
implementation < http://centreforaviation.com/analysis/airport-charges-ec-reports-increased-transparency-in-
setting-charges-but-uneven-implementation-171572 > accessed 27th November, 2016
19 | s 1 7 7 9 5 9 1
Chicago Convention on International Civil Aviation (Chicago, 7 Dec. 1944) 15
U.N.T.S. 295, entered into force4 April 1947, art15
European Union, Consolidated version of the Treaty on the Functioning of the
European Union (13 December 2007), 2008O.J. C 115/47
National Legislation and Quasi Legislation
S.41 (3) (c) of the Airports Act (1986)
Cases
Case T-128/98 [2000] ECRII-3929
Case T-271/03, Deutsche Telekom AG v Commission, C 128, 29, 24/05/2008,
Paragraph 86
Commission decision 95/364/EC OJ L 216, 12/09/1995
Commission Decision N. 2003/707/EC OJ L 263/9, 2003
Commission Decision 1999/199/EC OJ L 069, 16/03/19990031-0039
Commission Decision SA.23324 —C 25/07 (exNN 26/07), 25/07/12
Books
D. Starkie, Testing the Regulatory Model: The Expansion of Stansted Airport
397 (2004)
G. Monti, EC Competition Law (2007)
Prof. Dr. P. Mendes de Leon, Public Air Law Reader 2016-2017, pg. 335
S. Gleaves, Evaluation of Directive 2009/12/EC on airportcharges 75 (2013)
Dr. P. Morrell, Airport competition or network access? A European perspective
(2010)
Articles
ACI Europe, European airports: a competitive industry Policy paper submitted
by the Airports Council International(ACI) EuropePolicy Committee (2009)
20 | s 1 7 7 9 5 9 1
CAPA Centre For Aviation, Airport charges: EC reports increased transparency
in setting charges, but uneven implementation <
http://centreforaviation.com/analysis/airport-charges-ec-reports-increased-
transparency-in-setting-charges-but-uneven-implementation-171572 >
accessed 27th November, 2016
European Union, Mobility and Transport, Air charges
<https://ec.europa.eu/transport/modes/air/airports/airport-charges_en>
accessed 14th
November, 2016
IATA, Charges, Discounts and Incentives <
https://www.iata.org/policy/Documents/charges-discounts-incentives.pdf >
accessed 14th
November, 2016
ICAO Case Study on Commercialization, Privatization and Economic Oversight
of Airports and Air Navigation Services Providers, Directive 2009/12/EC of the
European Parliament and of the Council of 11 March 2009 on Airport Charges,
28 January 2013
J. Wiltshire, IATA Economics Briefing No 11: Airport Competition, November
2013

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Public law paper `q

  • 1. 1 | s 1 7 7 9 5 9 1 “Our role is to maintain and monitor a framework in which fair competition can flourish” – Arthur LevittJnr Do the discount of airport charges and other similar incentives for a few select airliners at airports promote anti-competitive conducts?
  • 2. 2 | s 1 7 7 9 5 9 1 Public Air Law Effects of Airports Charges on Fair Competition Leiden University Air & Space Law Adewale Mobolai B. (s1779591)
  • 3. 3 | s 1 7 7 9 5 9 1 Abstract This paper provides a comprehensive overview on airport charges. Starting with discussion of whether airports are natural monopolies or if they face real competition, It further goes on to ascertain if the discounts and incentives offered to a few select carriers on airport charges, most times to prevent airport switching and further increase commercial revenue as opposed to maintaining their dominant position, affects fair competition and promotes anti-competitive conducts. The directives enacted by the European Union on airport charges will be reviewed and also the instruments put in place by these regulations to curb or prevent anti- competitive conducts.
  • 4. 4 | s 1 7 7 9 5 9 1 Table of Contents 1. Introduction………………………………………………………………………….… 5 2. Airport Regulations……………………..…………………………..…………….. 7 3. Airport Competition…………….…………………….…………….…………… 11 4. Cases………….………….……………………….……………………………………… 15 6. Conclusion……………………..…………………………………………………….… 18 1.Introduction The aim of this paper is to analyse the effectiveness of the European Union Airport Charges Directive (2009/12/EC) (hereafter "EU Airport Charges
  • 5. 5 | s 1 7 7 9 5 9 1 Directive") in dealing with possible discrimination in the airport sector in relation to airport charges. It should be borne in mind that, from the onset and for a long time, airports have operated as natural monopolies; this scenario began to change with the deregulation of airports which has led to changes and diversity in ownership models for European airports such as, privately owned airports or a joint partnership structure between the government and private institutions and also as a public company. This new airport policy has changed the way airports relate to each other as well as their relationship with the airlines, especially after the introduction of the liberalization of air services that fostered competition in aviation and put pressure on the airports to improve their performance This has led to a sort of competition between airports as they have to compete amongst one another on price and service quality in order to retain and attract the traffic they need, as both airliners and passengers are now “footloose”, which is not helped by the fact that over 60% of the European population live within two hours’ driving time of at least two airports, aligned with the growth in numbers of direct routes served by airlines, which provides higher consumer choice.1 Airport competition is limited and probably distorted by the wide range of regulations it is subjected to which include the regulations enacted by the European Union aimed at levelling the playing field in the airport sector. Airport charges are paid by airlines for the use of airport facilities.2 They include aircraft landing, freight and other charges related to the use of airport infrastructure such as runways and passenger terminals. Ultimately these charges are paid, indirectly, by passengers and freight customers via the ticket price or freight forwarding fee. Airport charging systems are in many instances imposed or otherwise regulated by national authorities. Even where the airports concerned are privately owned, the charges have to comply with the rules by the authorities.3 Many airports offer discounts as an incentive to grow their network and attract new airlines. Nonetheless, there are some situations in which incentives can discriminate between airlines – 1 J. Wiltshire,IATA Economics Briefing No 11: Airport Competition, November 2013 2 Charges are levied based on the weight formula being Maximum Take-Off Weight (MTOW) as indicated in certificateof airworthiness asa basisfor assessment. 3 European Union, Mobility and Transport,Air charges <https://ec.europa.eu/transport/modes/air/airports/airport-charges_en>accessed 14th November, 2016
  • 6. 6 | s 1 7 7 9 5 9 1  when incentive schemes are not open to all carriers,  benefit only a limited number of users  And are funded by thoseairlines that do not benefit from them. In such a situation, incentives and discounts distort competition between airlines and are detrimental to users who do not benefit from them.4 Given the broad scope of EU Competition Law5 , the policy-makers in Europe may choose either to impose a strict price regulation on the airports or simply rely on the application of Article 102 when it is a dominant airport. Yet even the application of EU Competition Law has to take account of the particular features of the industry, such as issues related to market definition, the countervailing buyer power of the airlines and the economic incentives provided by the commercial activities in the airport area. First the author examines how the European airport industry is regulated and then goes on to describe how the airports compete and what kind of obstacles may be hindering the competitive process. 2.Airport Regulations Airport regulations were originally established in Article 15 the Chicago Convention6 , in 1944, in the guidelines from the International Civil Aviation 4 IATA, Charges,Discounts and Incentives < https://www.iata.org/policy/Documents/charges-discounts- incentives.pdf > accessed 14th November, 2016 5 European Union, Consolidated version of the Treaty on the Functioningof the European Union (13 December 2007) , 2008 O.J. C 115/47 6 Chicago Convention on International Civil Aviation (Chicago,7 Dec. 1944) 15 U.N.T.S. 295, entered into force 4 April 1947,art15
  • 7. 7 | s 1 7 7 9 5 9 1 Organization (ICAO) laid down in 1947. The Convention's rules were binding on the signatory states and governed sensitive areas such as discrimination against foreign airlines, whereas the ICAO's rules concerned best practices and were designed to provide a harmonious relationship between the airlines and airports. In 1974, ICAO’s document 9082/7 - Policies on Charges for Airports and Air Navigation Services which contained the recommendations and conclusions of the Council resulting from ICAO’s continuing study of charges in relation to the economic situation of airports and air navigation services provided for international civil aviation was published. States are encouraged to incorporate the four key charging principles of; 7  Non-discrimination: Charges must be non-discriminatory both between foreign users and domestic users and between any two or more foreign users  Cost relatedness: The charge is related to all the costs of operating the airport and its ancillary services. As a general principle it is desirable, where an airport is provided for international use, that the users shall ultimately bear the full and fair shareof the costof providing the airport.  Transparency: Airports should maintain accounts that provide information adequate for the needs of both airports and users, and that the facilities and services related to airport charges are identified as precisely as possible, should publish their financial statements on a regular basis, and should provide appropriate financial information to users in consultations.8  Consultation with users: Consultation between operators and airlines implies discussion of proposed charges, which should be notified a minimum of two months before the increase is due to take effect. This is not a negotiation, where no agreement can be reached by both parties, airport operators are free to impose charges at the level they deem necessary. 7 Prof. Dr. P. Mendes de Leon, Public Air LawReader 2016-2017,pg. 335 8 Guidanceon accountingcontained in the Airport Economics Manual (Doc 9562) may be found useful in this context, although there are other approaches.
  • 8. 8 | s 1 7 7 9 5 9 1 Into their national legislation, regulation or policies, as well as into their future air services agreements, in order to ensure compliance by airport operators and air navigation services providers (ANSPs). The most recent of the above document was published in 2012 and is the 9th edition, which confirms a constant effort by ICAO to review the document and keep it up to date with the latest developments in the aviation industry. There may be separate sets of airport charges for domestic and international flights at international airports and domestic airports. The European Union has traditionally been involved in airport policy, for example, the Council Regulation (EEC) 95/93 of 18 January 1993 on Common Rules for the Allocation of Slots at Community Airports and the Council Directive 96/67/EC of 15 October 1996 on Access to the Ground Handling Market. A need for a directive targeting airport charges specifically arose from the existence of multiple frameworks applied in the different Member States that could have threatened fair competition among airlines using European airports.9 On 24 January 2007, the European Commission proposed an initial legislative document whose purpose was to set up common principles for the levying of airport charges at European airports under the form of a Directive of the European Parliament and of the Council. The Directive 2009/12/EC of The European Parliament and of The Council of 11 March 2009 (“The Directive”) was established with explicit reference to ICAO’s Policies on Charges for Airports and Air Navigation Services (Doc 9082).10 The final legislative act was adopted on 11 March 2009 by the Council, which approved all amendments voted by the European Parliament. The European Commission initially proposed that the Directive be applied to any European airport whose traffic is over 1 million passenger movements or 25,000 tonnes of cargo, or which accounts annually for more than 15% of the passenger movements in the Member State in which it is located. But the European Parliament and the Council decided to subject to the Directive all European airports whose annual traffic is over 5 million passenger movement 9 ICAO CaseStudy on Commercialization,Privatization and Economic Oversightof Airports and Air Navigation Services Providers,Directive2009/12/EC of the European Parliamentand of the Council of 11 March 2009 on Airport Charges,28 January 2013 10 Like the ICAO, the Directiveonly sets out principles thatmust be embodied in national law.
  • 9. 9 | s 1 7 7 9 5 9 1 and to add the largest airport in each Member State.11 The Directive applies to all airport charges apart from the provision of air navigation and ground handling services which are already subject to Commission Regulation (EC) No 1794/2006 and CouncilDirective 96/67/EC respectively.12 The Directive looked to emphasizethe following points;  Prohibition of discrimination among airport users. This does not prevent the modulation of airport charges for issues of public and general interest, including environmental issues. The criteria used for such a variation shallbe relevant, objective and transparent.  Charges must be set in Transparent fashion and must be open and clear to anyone inquiring about the charge.  The level of airport charges may vary in accordance with the tailor-made services provided and airport operators have access to them on a non- discriminatory basis.  Member states must establish procedures for resolving disagreements between the parties  EU Member states must establish an independent supervisory authority (ISA) to guarantee the execution of The Directive once ratified into national law. The scope of Directive 2009/12/EC is restricted to procedural matters that affect the economic regulation of airports ISA functions have been granted to the national Civil Aviation Authorities, which are already in charge of several aviation matters in Member States. Some countries have instead granted ISA functions to existing independent regulators (Belgium, Luxembourg) or competition and regulation commissions (Netherlands, Estonia, Ireland). In Denmark, Finland and Sweden the national transport authorities now have ISA functions. Finally in Germany, federal governments retain competence over regional aviation and as such they have been designated as the ISAs, while referring to the central Ministry for policy 11 Directive2009/12/EC was expected to affect 150 of the EU's airports by the time that it came into force (Marques and Brochado,2008). 12 Security charges arealso beyond the scopeof Directive 2009/12/EC as they were the object of another Directiveproposal in 2009.
  • 10. 10 | s 1 7 7 9 5 9 1 matters. In Italy, no ISA has been formally appointed – the CAA (ENAC) is performing its functions temporarily as part of its regulatory activities.13 No Member States have “established” an ISA ex-novo, but rather they have assigned its functions to existing entities. The level of activity at ISAs has been low, with respect to the specific functions contemplated by the Directive. However several ISA representatives have been involved in consultation sessions in their respective Member States. These meetings took place either as part of the reformulation of economic regulatory measures in some Member States (UK, Ireland) or as part of the annual consultation mandated by the Directive (Czech Republic, Romania).14 3.Airport Competition Competition, as defined by the OECD (1993), is "a situation in a market in which firms or sellers independently strive for the patronage of buyers in order to 13 The European Commission recently issued a formal noticeto the Italian government for failures in implementing the EU AirportCharges Directive(2009/12/EC). With infringement procedure 2014/4187 (still in its pre-litigation phase) the commission contested the consultation procedurethat aimed to regulate charges at five major Italian airports (Fiumicino and Ciampino in Rome, Malpensa and Linate in Milan and Venice airport) through contractagreements between airportmanagement and the Italian Civil Aviation Authority (ENAC). 14 S. Gleaves, Evaluation of Directive2009/12/EC on airportcharges 75 (2013)
  • 11. 11 | s 1 7 7 9 5 9 1 achieve a particular business objective, e.g., profit". Competition between airports can take many forms but it ultimately occurs in two areas: pricing and services. First, they compete to attract airlines; then they attempt to attract other service providers that may or may not compete with their other services (ground handling and commercial).15 In a report by ACI Europe, the following methods were listed as the ways which airports compete amongstthemselves;16  Competition to attract new airline services (passengers and freight); by stressing the quality of the infrastructure and the attractiveness of their amenities to the passengers served by the airlines and also granting discounts on the cost of landing and taking off. For example Brussels citing Charleroi as their main competitor, Amsterdam citing Brussels, Lisbon citing Madrid, Malmö citing Copenhagen and so on for new low cost carriers (LCC)  Competition between airports with overlapping hinterlands; Airports in the same cities, such as Heathrow and Gatwick which are airports situated in London with a similar amount of time to be accessed by passengers and similar costs.  Competition for a role as a hub airport and for transferring traffic between hubs; this are airports that have a large amount of transfer passengers.17 Other examples are Liège and Cologne competing to be the carrier hub for express parcels; the Frankfurt Hahn and Stockholm Skavsta competition for being the aircraft base for low-cost carrier as with Liverpool and Manchester; Also Munich and other larger German airports competing to be the second hub for Lufthansa - the list identifies alternatives open to the airline, whether or not any formal competition by the airports in question took place. In fact, Manchester Airport did not have the margin of unused capacity that might 15Dr. P. Morrell,Airportcompetition or network access? A European perspective (2010) 16 ACI Europe, European airports:a competitive industry Policy paper submitted by the Airports Council International (ACI) Europe Policy Committee (2009) 17 The listis notexhaustive.In the book Airport Competition; The European Experience (2010), written by Dr. J. P. Forsyth a longer listis given.
  • 12. 12 | s 1 7 7 9 5 9 1 have motivated it to seek low-cost airline services. The same would have applied to Düsseldorf Airportin relation to Lufthansa’s second hub.18 Competition law can be broadly defined as the rules that guide the Government's intervention to stop or prevent anti-competitive conduct and preserve competition in the markets with the aim of enhancing economic welfare. The way competition law is enforced is constantly evolving as it is influenced by political, economic and institutional factors.19 When the EU Competition Law is applied to deal with an abuse of dominance in the airport services, there is likely to be opposition to the Commission's decision on the grounds that there already exists regulators established by National law as directed by Directive2009/12/EC, with one of the aims being to promote Fair competition and with the ability to permit or block a particular form of conduct. This issue was addressed in the dispute between the Commission and Deutsche Telekom20 (DT) in which the latter was accused of adopting a margin squeeze system of pricing to the detriment of its competitors. In its decision, the Commission found that the DT had abused its dominant position by charging prices for access to its network that were even higher than it charged to its own subscribers in the downstream retail market. DT defended itself by arguing that its fees had been approved by the German regulator and that any legal action should be taken against Germany under Article 258, TFEU (formerly Article 226, TEC). The Commission was of the view, backed by the case-law, that the "competition rules may apply where the sector-specific legislation does not preclude the undertakings it governs from engaging in autonomous conduct that prevents, restricts or distorts competition". The General Court upheld the Commission's decision by stating that DT could only have escaped prosecution under Article 102 if the anti-competitive conduct had been required by national legislation or if the latter had created a legal framework which in itself precluded the possibility of competition. The decision went even further by holding DT responsible for not correcting its 18 See Forsyth, supra note 17, at 16 19 G. Monti, EC Competition Law (2007) 20 Commission Decision N.2003/707/EC, OJ L 263/9 2003
  • 13. 13 | s 1 7 7 9 5 9 1 conduct when the German regulator had failed to recognize its anti- competitive effects.21 Although the DT case has not received a final word from the ECJ, the Court is expected to decide in favour of the Commission. This is due to the constitutional status of the Treaty that gives competition provisions prevalence over national law, even when the latter has been set out in response to an EU Directive. Article 102 TFEU(formally 82 TEC) describes an abusivedominant position; Any abuse by one or more undertakings of a dominant position within the internal market or in a substantial part of it shall be prohibited as incompatible with the internal market in so far as it may affect trade between Member States. In the United Brands v. Hoffmann-La Roche case(1978), the European Court of Justice (ECJ) offers definitions of a ‘‘dominant position’’ and of the ‘‘abuse’’ of such a position, which are still used today; “[A] position of economic strength enjoyed by an undertaking which enables it to prevent effective competition being maintained on the relevant market by giving it the power to behave to an appreciableextent independently of its competitors, customers and ultimately of its consumers” In the ECJ’s decision, dominance is defined as the power to behave to an appreciable extent independently of the behaviours of others. However, European competition law does not impose sanctions on the dominant position, per se, but only its abuse.22 In the same case the ECJ portrayed abusive conduct as behaviour which, through recourse to methods different from those which condition normal competition in products or services on the basis of the transactions of commercial operators, has the effect of hindering the maintenance of the degree of competition still existing in the market or the growth of that competition. Although Article 102 provides some examples of abuses, the list is not exhaustive. For the liability conditions of Article 102 TFEU to apply, the airport must have a substantial share of the internal market. The General Court ruled in Aéroports 21 CaseT-271/03, Deutsche Telekom AG v Commission,C 128, 29, 24/05/2008, Paragraph 86 22 The ECJ confirms a findingthat an undertaking has a dominantposition is notitself a recrimination butsimply means that, irrespectiveof the reasons for which ithas such a dominant position,the undertaking concerned has a special responsibility notto allowits conductto impair genuineundistorted competition on the common market (NV Neverlandsche Banden-IndustrieMichelin v.Commission,1983).
  • 14. 14 | s 1 7 7 9 5 9 1 de Paris (ADP) v Commission23 that this requirement should be assessed in terms of the size of the undertaking and volume of passengers that use the dominant airport in comparison with the airport capacity that exists in the European Union.24 The first step in determining whether an airport has a dominant position is to determine in which market, judged by its products and geographical dimensions, its competitors are capable of promoting effective competition or constraining the airport's conduct. Once the boundaries of this market have been determined, it is necessary to calculate the market share of the competitors to make a preliminary assessment of their degree of dominance. The regulatory and competition authorities have relied heavily on examining the overlap of arbitrarily-defined catchment areas to define the number of airports within a certain drive-time. As mentioned by the UK Competition Commission in its "Working paper on market definition" (2009), the demand for airport services is derived from the demand for air transport. Hence a change in price or quality of airport services can affect the demand in two, possibly cumulative, ways:  By inducing a direct airline to replace its current airportwith another;  By affecting the airline's prices and indirectly inducing passenger to switch to another airline and/or airport. 4.Case Law 23 CaseT-128/98 [2000] ECR II-3929 24 It should be mentioned though that a national courtor NCA is not bound by a previous findingof dominance by the Commission
  • 15. 15 | s 1 7 7 9 5 9 1 A large part of case law in its application to airports has been based on State Aid, such as State Aid No. C 12/08 (ex NN 74/07), Agreement between Bratislava Airport and Ryanair; State aid No N 27/2008 – United Kingdom Aid of a Social Character Air Services in the Highlands and Islands of Scotland (prolongation of N 169/2006 and several similar cases, but the focus here will only be on the cases where the abuse of dominance under Article 102 was brought into question. Remarkably, there have not been many investigations by the Commission aimed at revealing abusiveprices charged by the airports.25 In a case against Brussels-Zaventem Airport26 in which British Midlands Airways complained that a discount system based on the volume of traffic, put the small carriers at a competitive disadvantage and did not have any objective justification. As part of their assessment, the Commission ruled that the airways authority (the public body responsible for managing the airport and setting its prices) was a public undertaking to which was given exclusive rights under the provision of Article 106(1). In addition, the decision declared that the airport's position as the eleventh busiest airport in the internal market in terms of passenger movement and the fifth busiest in terms of freight made it a substantial part of the common market. Having proved its undertaking liability under Article 102, the Commission analyzed the following arguments brought forward on behalf of the defendant:  the right of an undertaking to introduce a system of reductions as part of its commercial policy,  the right to grant larger discounts to loyal customers, particularly in view of the financial security they provide,  the economies of scale by which it costs less (in terms of administration and staff) to supply services to a national carrier with a large volume of traffic at the airport,  The airport is made more attractive when there is a national carrier offering an extensive network of destinations (paragraph 16). The first two arguments were rejected by referring to the "special responsibility" doctrine (Case 322/81 Michelin v Commission [1983] ECR 3461, 25See Commission Decision SA.23324 —C 25/07 (ex NN 26/07),25/07/12 26 Commission decision 95/364/EC OJL 216, 12/09/1995
  • 16. 16 | s 1 7 7 9 5 9 1 paragraph 57) that the dominant undertaking must not to impair competition even further (as had been the case with regard to the loyalty-inducing rebates). The Commission argued that the defendant had failed to prove that there were economies of scale since the services provided were the same, regardless of how often they were supplied and it dismissed the idea that the concentration of flights by the national airline would have the effects that had been alleged. In assessing the merits of the case, the Commission interpreted the undertaking's conduct as demonstrating discriminatory abuse and following the reasoning adopted in the Corsica Ferries II (Case C-18/93 [1994] ECR I-1783), decided that, by acting through an intermediary, The Kingdom of Belgium had benefited the national airline. The discount system was found to be in breach of Articles 102 and 106(1), formerly Articles 86 and 90 (1) of the EC Treaty.27 On a national level, price undercutting has been found by an investigation carried out at Stansted airport28 . Luton airport made a complaint to the British regulator (CAA) that Stansted was levying very low charges and this caused Ryanair to transfer its services. Stansted confirmed that the charges were below its costs but justified its conduct on the grounds that the airport was relatively new and was still seeking to recover its initial operating costs. It also argued that the airport's revenues were still above the average avoidable costs and thus it could not be accused of being engaged in predatory pricing. After examining the Stansted figures, the CAA admitted that discounts were below costs and could not be matched by Luton. However, the regulator found itself in a situation where it was bound by the airports policy (which allowed an early expansion of Stansted) and stated that: "Luton has been materially harmed but that harm stems from the Government's decision in 1985 that the next significant tranche of airport capacity to serve the South-East should be at Stansted ... For the Authority to find that the policies Stansted has pursued…. should be inhibited or reversed because of their effect on Luton would be tantamount to saying that the decision to develop Stansted was wrong" (paragraph 61).29 In the end, the CAA concluded that no remedy was feasible under its statutory discretionary powers to impose a price monitoring framework on the airport.30 27 See Commission Decision 1999/199/EC OJL 069, 16/03/1999 0031-0039 28 It was a sector-specific investigation as theCAA does not have the power to enforce EU Competition Law 29 D. Starkie,Testing the Regulatory Model: The Expansion of Stansted Airport 397 (2004) 30 See S.41(3)(c) of the Airports Act (1986)
  • 17. 17 | s 1 7 7 9 5 9 1 Unfortunately, the case was not analysed by the Monopolies and Mergers Commission (the predecessor of the Competition Commission) and there was no additional information available to verify whether or not the airport had been guilty of predatory pricing. 5.Conclusion In 2013 the Commission carried out a study and subsequently presented a report in 2014 on the application of the Airport Charges Directive by the Member States. In this report the Commission noted that whilst some
  • 18. 18 | s 1 7 7 9 5 9 1 positive results can be identified in terms of increased transparency of airport charges, more needs to be done to ensure the consistent application of the Directive in the EU. It should be understood that though this directive has made some improvements, it still isn’t yet as effective as airliners are still complaining about the charging powers of the major airports such as the UK’s Heathrow Airport, which has some of the highest charges globally, upset airlines with plans to raise charges per passenger from GBP21.96 to GBP27.30 over a five-year period (almost 6% over inflation), which it claimed to be necessary to support its ongoing GBP3 billion investment programme. Those charges paid by airlines constitute the biggest single source of income for Heathrow Airport, raising GBP1.3 billion for Heathrow in 2012. 31 The above is to the detriment of airports in the same catchment area with Heathrow, such as Gatwick Airport and Stansted, as they are restricteed by the Directive and ISA’s from also increasing their airport charges which creates an unfair market for them as they cannot grow economically with preference being given to the main airport. Amongst other reforms, it is advised that the commission should move its focus to the largest Airports in a catchment area, as it is definitely clear airports are no longer natural monopolies, so as their business does not kill the growth of the smaller Airports who are restricted from increasing charges and thus cannot improveservicesbeing provided by them to airliners. Bibliography International Laws and Treaties 31 CAPA Centre For Aviation, Airport charges:EC reports increased transparency in settingcharges,but uneven implementation < http://centreforaviation.com/analysis/airport-charges-ec-reports-increased-transparency-in- setting-charges-but-uneven-implementation-171572 > accessed 27th November, 2016
  • 19. 19 | s 1 7 7 9 5 9 1 Chicago Convention on International Civil Aviation (Chicago, 7 Dec. 1944) 15 U.N.T.S. 295, entered into force4 April 1947, art15 European Union, Consolidated version of the Treaty on the Functioning of the European Union (13 December 2007), 2008O.J. C 115/47 National Legislation and Quasi Legislation S.41 (3) (c) of the Airports Act (1986) Cases Case T-128/98 [2000] ECRII-3929 Case T-271/03, Deutsche Telekom AG v Commission, C 128, 29, 24/05/2008, Paragraph 86 Commission decision 95/364/EC OJ L 216, 12/09/1995 Commission Decision N. 2003/707/EC OJ L 263/9, 2003 Commission Decision 1999/199/EC OJ L 069, 16/03/19990031-0039 Commission Decision SA.23324 —C 25/07 (exNN 26/07), 25/07/12 Books D. Starkie, Testing the Regulatory Model: The Expansion of Stansted Airport 397 (2004) G. Monti, EC Competition Law (2007) Prof. Dr. P. Mendes de Leon, Public Air Law Reader 2016-2017, pg. 335 S. Gleaves, Evaluation of Directive 2009/12/EC on airportcharges 75 (2013) Dr. P. Morrell, Airport competition or network access? A European perspective (2010) Articles ACI Europe, European airports: a competitive industry Policy paper submitted by the Airports Council International(ACI) EuropePolicy Committee (2009)
  • 20. 20 | s 1 7 7 9 5 9 1 CAPA Centre For Aviation, Airport charges: EC reports increased transparency in setting charges, but uneven implementation < http://centreforaviation.com/analysis/airport-charges-ec-reports-increased- transparency-in-setting-charges-but-uneven-implementation-171572 > accessed 27th November, 2016 European Union, Mobility and Transport, Air charges <https://ec.europa.eu/transport/modes/air/airports/airport-charges_en> accessed 14th November, 2016 IATA, Charges, Discounts and Incentives < https://www.iata.org/policy/Documents/charges-discounts-incentives.pdf > accessed 14th November, 2016 ICAO Case Study on Commercialization, Privatization and Economic Oversight of Airports and Air Navigation Services Providers, Directive 2009/12/EC of the European Parliament and of the Council of 11 March 2009 on Airport Charges, 28 January 2013 J. Wiltshire, IATA Economics Briefing No 11: Airport Competition, November 2013