A. ALEXIS
Revision of the Aviation Guidelines
Liberalisation of air transport market
From national air transport market to EU internal market for air transport
1997 – completion of the
internal market
1993 – the third liberalisation package
1990 – the second liberalisation package
1988 – the first liberalisation package
1984 -liberalisation of scheduled inter-regional
air services
Increased competition between airlines and airports
2
New market players – Emergence of the Low Cost Carriers
1994 Aviation Guidelines
2005 Aviation Guidelines
Network carrier (incumbent) 44 %
6
5
Low cost carrier 40 %
4
3
2
Regional airlines 16 %
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
0
1996
1
1995
Weekly seats available (millions)
7
Increased competition and low prices for customers
Source: OAG summer schedules
3
Increased number of regional airports
~460 airports are
used for commercial
aviation in the EU
Member States
Increased number of regional airports facilitates local/regional
development, but danger of creation of unused capacity
4
High number of publicly owned airports
77 % of EU airports are
still publicly owned
Public airports are usually smaller than
mixed/privately owned airports
Privately owned
9%
Mixed
ownership
14%
60%
52%
720 M pax
50%
34%
470 M pax
40%
30%
14%
20%
200 M pax
10%
Publicly owned
0%
Public
Mixed
Private
77%
Vast
majority of airports is subsidised
Source: ACI
5
High number of small airports
~60 % of airports serve less than 1 million passengers in 2010
Financing of
operation of these
airports is covered
by the 2012 SGEI
Decision
~462 airports are used for
commercial aviation
These airports
usually cannot
finance their
operating costs
from own revenue
181
≤ 200 000 pax
These airports usually cannot
finance part of their capital costs
97
80
33
≤ 1 M pax
1 – 3 M pax
3 – 5 M pax
These airports
are usually selffinancing
71
≥ 5 M pax
Small airports are not able to support all their costs
Source: ACI Europe, Data 2010.
Source: ACI, Year 2010.
6
Where we are
Where do we want to go
Increased competition between
airlines and airports
level playing field. Interactions
between aid to airports and aid
to airlines
Enabled regional/local
development and accessibility
Continue to enable regional
development and accessibility
Duplication of unprofitable
airports
Avoid duplication of unprofitable
airports and creation/
maintenance of overcapacity
Vast majority of airports are
subsidised
Avoid waste of public money
and reduce the need for public
funding (State aid)
7
State of play
Public funding of airports is subject to State aid rules
Operation of an airport and construction of airport infrastructure is an
economic activity, except activities falling within public policy remit, e. g.
police, customs, air traffic control (Judgement of 12 December 2000 in Aéroport de Paris case,
confirmed by Leipzig-Halle airport judgement of 24 March 2011)
Question: Would a profit oriented market economy investor finance the
investment of the airport or cover operating losses of the airport?
If yes
No aid to the airport
If no
Aid to the airport
8
State of play
2005 Aviation Guidelines
Compatibility criteria for
investment aid to airports
financing airport infrastructure
No aid intensity thresholds
(up to 100 % on a case by
case assessment) and only
rarely notified by MS
No compatibility criteria for
operating aid to airports to
finance their losses
Exception compensations for
Service of General Economic
interest  only for small
airports in remote areas
Start-up aid to support
launching of new routes from
small regional airports
Only financing of marketing
support allowed and was
only rarely used by airports
and notified by MS
9
What have we done?
Contact with stakeholders
e. g. ACI Europe, ERAC, IATA, AEA, ELFAA, ERA, individual airports and airlines,
etc.
Public consultation
7 April 2011 – 7 June 2011: 89 replies providing
feedback on the recent market developments:
•
21 Member States, Norway and 12 regional
authorities
•
22 Airports, 9 Airlines, 14 Airline and airport
associations
10
Main results of the public consultation
Majority of the stakeholders supports the revision of the existing guidelines
•
Simplification and increased transparency
•
More enforcement of State aid rules to airports and airlines
•
Need for special rules for small airports and airports in remote areas
•
More predictable rules for investment aid (clarifications on eligible costs
and aid intensity thresholds)
•
Rules to avoid distortion of competition between airports located in the
same catchment
11
Interactions between financing of airports and possible aid to
airlines
Aid granted by a Member State
Publicly financed airports might reduce the price
for the airport services rendered to the airlines
Airlines using this airport could indirectly
benefit from an aid
12
Policy perspective
Current
situation
Transitional
period
Steady
state
regime
13
Where we want to go in the long-term: A "steady state" regime
Investment aid
to airports
Range of permissible maximum aid intensities depending on the size
Necessity , proportionality and incentive effect to be demonstrated
Additional capacity created meets medium-term demand in the
catchment area and does not lead to duplication of unprofitable
infrastructure
Operating aid to
airports
Should not be necessary as airports should be able to cover their
operating costs (exception small airports up to 200.000 which can
be declared SGEI)
14
Growth potential
Financing of operation
of these airports is
covered by the 2012
SGEI Decision
Growth potential?
Small airports may
have problems in
financing their
operating cost
181
≤ 200 000 pax
Source: ACI Europe.
97
80
33
≤ 1 M pax
1 – 3 M pax
3 – 5 M pax
71
≥ 5 M pax
15
A number of airports managed to grow into a more viable size
Calculation based on a sample of 245 EU (total number of airports in EU = 462).
Source: Data ACI Europe.
16
How can transitional period be designed?
Investment aid to
airports
Operating aid to
airports
No phasing-in needed
Operating aid to airports allowed under certain conditions
[with a passenger volume of less than x mio passengers]
17
Under which conditions could operating aid to airports be allowed?
Why are airports not able to cover their operating costs?
due to unused capacity
due to too low airport charges
Aid to the airport
Aid to the airlines
18
How to exclude existence of aid to airlines by publicly funded
airports?
Market price
Appropriate market benchmarks normally
not available at this moment
In absence of an
appropriate market
benchmark
Assessment based on a "cost approach"
Airlines pay charges corresponding to the costs in
accordance with their use of the airport services
19
Airport charges and aid to airlines
"Steady state" regime
No aid to the airlines
airport charges (including non-aeronautical revenues) cover
airport's costs
Transitional period
Which operating aid to airlines?
20
Next step
Beginning 2013: consultation Member States,
stakeholders and interested parties on a written document
21