Airlines and airports meet headwinds over charges

In proposals released last month, Jacques Barrot, the European commissioner for transport, sought to mediate a peace between airports and airlines over the vexed issue of airport charges.

The dispute had intensified last year, with airlines complaining that monopoly airports had been abusing their dominant position, charging exorbitant fees for use of their facilities.

Barrot recommended that member states establish arbitration bodies to supervise the setting of fees and appears to have defused the issue, at least for now.

"It’s a step in the right direction, but we’re not at our destination yet," says Antony Concil, director of communications at airline lobby International Air Transport Association (IATA). "Clearly the fact that they’re [the European Commission] paying attention shows awareness that the problem exists."

IATA has in the past fiercely criticised the airports, protesting that airlines are being given no choice but to foot the bill for costly airport renovations. Improvements to airport revenue-raising projects, such as shopping areas and car parks, should not be charged to airlines, they say. Airlines were arguing for the Commission to introduce strict caps on charges.

Airports, on the other hand, faced with sharply rising passenger numbers, claim that improvements to infrastructure are needed to prevent a meltdown. The extraordinary success of low-cost airlines has resulted in very rapid expansion in passenger numbers. The airport industry argues that unless the developments are made, then there will be constraints on capacity. Stefano Baronci, policy manager at airport lobby ACI-Europe, is adamant that the Commission’s suggestions are the best that airlines can hope for.

The Commission’s proposal sets norms and standards aimed at ensuring that arbitration bodies remain entirely independent of national governments and industry. "As it stands it’s a good achievement. The airlines should be happy," says Baronci. "I think that the directive as a framework provides for quite detailed consultation between airports and users."

Airlines, for their part, appear content to adopt a wait-and-see approach, but lament the lack of specific targets on airport efficiency. "There has to be some kind of guidance to give the regulation teeth. If the purpose is to increase competition, there has to be stronger guidance," says IATA’s Concil. "You’ve set the stage, you’ve got the actors in place. Now, let’s get the script right."

But airports are already kicking against the few concrete provisions contained in the directive. In order to guarantee transparency, they will have to list services and infrastructure provided in return for charges. "This requirement basically undermines normal commercial relationships between airlines and airports and perversely acts as a disincentive to airport competition," says Baronci. Stricter requirements on breaking down charges, he fears, could become a "tool of dispute".

So Barrot’s proposals, while a good attempt at achieving peace, may yet be the subject of further dispute.

In proposals released last month, Jacques Barrot, the European commissioner for transport, sought to mediate a peace between airports and airlines over the vexed issue of airport charges.

• Primary Source