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European Parliament Wants Common Approach To Airport Charges
by Ulrika Lomas, Tax-News.com, Brussels

23 January 2008

The European Parliament has adopted a legislative report that sets out common principles for levying airport charges at European Union airports.

The directive aims to prevent any abuse of a dominant position in the market by individual airports, and to encourage balanced development of the EU airport sector. The report was adopted by 613 votes in favour to 33 against and 51 abstentions.

The EU executive, the European Commission, had proposed that the new rules should apply to airports with an annual traffic of more than one million passengers, but the European Parliament is in favour of five million passengers as a threshold. This reflects a concern that the Directive as drafted would capture smaller airports which are not in a potentially market dominant position. The European Parliament's decision means that 67 airports throughout the EU will be affected by the directive.

Under the new rules, all airports will be bound by common rules on provision of mutual information, transparency, and the way airport charges may be collected. It is also planned to introduce national independent regulatory authorities to ensure that the directive is applied in full. This body should establish procedures for resolving disagreements between the airport managing body and the airlines about changes to the level and structure of airport charges, including in relation to quality of service.

The European Parliament has introduced a new amendment stipulating that: "The airport managing body may pre-finance new infrastructure projects by increasing airport charges accordingly, on condition that a) airport users are provided with transparent information on the extent and duration of airport charge increases; b) all additional revenue is used solely for the construction of the planned infrastructure; c) all official authorisations have been obtained."

In addition, compromise amendments were adopted on the definition of airports charges, on airport networks, on the level of service quality to be provided by the airports managing body in return for the airports charge and the financing of new infrastructure projects.

Speaking in favour of the proposed measures during a debate in Strasbourg on 14th January, Brian Simpson, a UK member of the European Socialist group argued there was a need for transparency in airport charges.

"I fully support the need to ensure that airports in a dominant position do not abuse that situation and I fully support an open and transparent appeals procedure, provided that the rules of engagement and the remit of the arbitrator are clearly defined," he stated.

However, he qualified his support by adding that: "I am not against regulating airports that are in a dominant market position, but I think regulating the majority of airports to catch the big boys, based on an arbitrary passenger figure in a one-cap-fits-all regulation, is a flawed process."

Other MEPs, such as the non-aligned Jim Allister of Northern Ireland, warned that the proposals would lead to the over-regulation of airports, and would be especially damaging for the growth of regional airports and economies.

"The Commission talks much about promoting competitiveness in industry and about cutting red tape, but its walk in these issues is often one that takes Europe in quite the opposite direction, and so it seems to me with its stance on air travel. Having championed increased costs for air travellers through green taxes, we now have a proposed directive on airport charges which will inevitably drive up costs for the flying public," he remarked.

"Regional airports are my particular concern," he continued, adding that: "They have been a catalyst for progress in many regional economies: they have opened up markets; they have made the inaccessible accessible; they have been indispensable in economic transformation. And now, true to form, the Commission wishes, effectively, to stifle them with the heavy hand of bureaucracy, burying innovation under a mountain of reporting requirements for which the traveller will ultimately pay."

The list of the 67 airports affected by the proposals includes:

Alicante, Amsterdam/Schiphol Athina/Eleftherios Venizelos, Barcelona, Berlin-Schoenefeld Berlin-Tegel, Birmingham, Bourgas, Bratislava, Bristol, Brussels/Brussels-National, Bucharest/Henri Coanda, Budapest/Ferihegy, Catania/Fontanarossa, Dublin, Düsseldorf, Edinburgh, Faro, Frankfurt/Main, Glasgow, Gran Canaria, Hamburg, Hannover, Helsinki/Vantaa, Iraklion/Nikos Kazantzakis, Kobenhavn/Kastrup, Köln/Bonn, Lanzarote, Larnaka/INTL, Lisboa, Ljubljana, London Gatwick, London Heathrow, London Luton, London Stansted Luxembourg, Lyon Saint-Exupery, Madrid/Barajas, Malaga, Malta/Luqa, Manchester, Marseille-Provence, Milano/Linate, Milano/Malpensa, München, Newcastle, Nice-Cote d´Azur, Pafos/INTL, Palma de Mallorca, Paris-Charles de Gaulle, Paris/Orly, Praha/Ruzyne, Riga, Rodos/Diagoras, Roma/Fiumicino, Sofia, Stockholm/Arlanda, Stuttgart, Tallinn, Tenerife Sur/Reina Sofia, Timisoara, Toulouse-Blagnac, Toulouse/CCER, Varna, Venezia/Tessera, Vilnius, Warszawa/Okecie and Wien/Schwechat.

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