EN    EN EN 
EN    EN  COMMISSION OF THE E UROPEAN COMMUNITIES 
Brussels, 11.05.2009 
SEC(2009)615 
COMMISSION STAFF WORKING DOCUMENT 
Accompanying document to the 
 
Proposal for a Directive of the European Parliament and the Council on aviation 
security charges 
  
IMPACT ASSESSMENT  
 
{COM(2009)217 final} 
{SEC(2009)616} 
EN 2   EN COMMISSION STAFF WORKING DOCUMENT 
Accompanying document to the 
 
Proposal for a Directive of the European Parliament and the Council on aviation 
security charges 
  
IMPACT ASSESSMENT  
 
{COM(2009)217 final} 
{SEC(2009)616} 
Lead DG : TREN 
Other involved services :  
Agenda planning or WP reference : 2009/TREN/020 
Executive summary 
The terrorist attacks of 11 September 2001 in the United States had a profound impact on the 
global aviation sector as well as on the Euro pean aviation sector. Strong measures were 
essential to address the threats posed by international terrorism and to restore public 
confidence in the aviation sector. 
Consequently, the cost of aviation security ha s increased over the last  years. A study for the 
Commission estimated that in 2002 more than  90% of these costs are recovered through 
security charges (or taxes) levi ed on air passengers, airlines and cargo shippers. In 2007 these 
security charges yielded estimated revenue of €1.6 billion in the EU, which constitute 
approximately 1 percent of the average air fare. 
Problem 
The rise in aviation security cost s has drawn the industry's attenti on to such costs.  Each airline 
therefore tries to minimise its security costs by attempting to influence the structure for 
security charges. Usually the largest airline at the airport has a considerably stronger position compared to the other airlines and may use this to ensure that the level of security charges are lower for markets where the airline has a propor tionally larger share of  the traffic than the 
other airlines. In addition, focus is also incr easing on security charges because other airport 
fees are regulated by the recent ly adopted Directive on airport charges. However, this report 
has not managed to establish that  these risks are translated into differentiated security charges 
in all Member States. 
EU action justified 
Current structures that differentiate security ch arges mainly benefit the main national airlines 
when operating from airports in the same Member  State. Airlines from other Member States 
benefit less from the differen tiated security charges. 
EN 3   EN Objectives 
As aviation security is a core state responsib ility, security charges shall therefore not be 
subject to commercial decisions between an ai rport and an airline. The main objective is, 
firstly, to ensure that secu rity charges do not unduly differ entiate between airlines, air 
passengers or cargo shippers in the EU. Secondly, security charges shall not generate profit or 
be used to cross-subsidise be tween airlines. Revenues from s ecurity charges shall therefore 
only be used to cover the costs to wh ich the security services give rise. 
Options 
This impact assessment evaluates four di fferent options that are based on existing 
international principles on security charges or responses received dur ing the consultations 
process from March to September 2008. 
Option 1 examines the consequences of no EU action. If no EU action is taken, security 
charges are more likely to discriminate among ai rlines and passengers. In particular, as the 
Directive on airport charges prohibits  other charges to discriminate.  
Option 2 examines whether self-re gulation by the industry can ensu re consumers' interest and 
promote more efficient aviation security serv ices. Such self-regulation could be based on 
certain international principles that already are endorsed by ICAO. These principles are: non-
discrimination, consultation with the airlines, tran sparency of security cost and revenues from 
security charges shall only be used to cover se curity costs. The objectiv e of consultation is to 
allow for the airlines to have the possibility to make suggestions on how to increase the 
effectiveness and efficiency of security services. Consequently, this option will encourage a dialogue between airlines and airports to look fo r more efficient ways to  comply with security 
requirements. However, these principles were  published already in 1981 and are still not 
respected. Self-regulation by the industry is therefore not likely to effectively address the problems identified. The effects of  option 2 are the same as if the Commission were to issue 
non-binding recommendations on how to so lve the identified risks because such 
recommendations would be the same as  the already existing ICAO-principles. 
Option 3 is similar to the second option, but ma kes the principles le gally binding through an 
EU Directive. In addition, the third option allows for airlines to appeal decisions by airports if 
the security charges are discriminatory or cove r other costs than security costs. This will 
increase the effectiveness of the transparency  obligation and is estimated to reduce overall 
costs for aviation security by 10 percent. This option is also  supported by other Commission 
policies and in line with Member States policies. 
Option 4 suggests that Member Stat es should fully finance airpor t security. This will remove 
any security charges and their discriminatory aspects. This is the preferred option by all 
industry representatives and it al so most effectively removes any discriminatory aspects of 
security charges. However, this option discourag es a more efficient aviation security services 
because there are no incentives fo r the security providers to contro l the costs. In addition, it is 
unlikely to be accepted by the Council as it is vehemently opposed by Member States. 
This impact assessment concludes that consumer s' interest and more efficient provision of 
airport security services are best addresse d by option 3. The administrative burden for 
EN 4   EN Member States and the increased cost of busin ess of option 3 are negligible as that option 
builds upon already existing structures estab lished by the Directive on airport charges1. 
Monitoring and evaluation 
The Commission will continuously monitor the de velopments in the aviation security sector 
and especially evaluate on a re gular basis the number of air ports publishing their security 
charges. 
SECTION 1: PROCEDURAL ISSUES AND CONSULTATION OF INTERESTED PARTIES  
1.1 Organisation and timing 
This impact assessment has been prepared by DG Energy and Transport (TREN) with the 
contribution of an Inter-services Steering Group  in which the following Directorates General 
participated: DG JRC, DG EC FIN, DG ENTR and DG COMP . The Steering Group met 2 
times. 
Work on this impact assessment started in 2008.  This proposal is part of the Commission's 
2009 work programme and has the agenda planning number 2009/TREN/020. 
1.2 Consultation and expertise 
1.2.1 Consultation with Member States and stakeholders On 17 March 2008 DG TREN submitted a questi onnaire to Member States asking for 
information on existing national le gislation and the most recent estimates of national security 
costs. DG TREN wished to have their co mments before 15 April 2008. On 2 April 2008 a 
similar questionnaire was sent to organisatio ns representing industr y and consumers. The 
recommended deadline for stakeholders to submit their comments was 30 April 2008. This 
questionnaire asked for estimates of security co sts, the impact of security measures on the 
industry and whether existing national legislati on allowed the industry to recover security 
costs. The consulted parties were asked to re ply before the end of May. Consequently, the 
Commission's minimum standards for consultation have been met. 
5 Member States replied that existing airport charges consultations pr ovide airlines with 
sufficient information on security costs as well . Similarly for cost-rel atedness of security 
charges, 11 Member States replied that the same consultations ensure that security charges are 
used to exclusively to meet security costs. However, these consulta tions do not require the 
approval of the operators to modify security ch arges and do therefore not ensure transparency 
and cost-relatedness. Actually, only the Netherlands have sp ecific legislation in force 
requiring security charges to be both transpar ent and cost-related. The Italian legislation, 
which is the other national legislation targetin g security charges, only ensures transparency. 
The replies also confirmed that aviation security is mainly fi nanced through security charges 
on airlines, air passengers and ca rgo shippers. This is usually referred to the "user-pays" 
principle. 11 Member States rely almost entirely on such charges. 6 Member States 
sometimes make significant contributions to the s ecurity costs. 4 Member States did not reply 
                                                
 
1 Proposal for a Directive of th e European Parliament and of the Council on airport charges 
COM(2006)820 final of 24.1.2007 
EN 5   EN or did not reply in sufficient detail for th e Commission to draw a ny conclusions on their 
replies. 
Organisations representing airlines, airports a nd consumers were asked to provide information 
on the cost and impact of av iation security. 9 organisations , mainly airport and airline 
organisations, replied and they a ll argued that States should c over for security costs because 
the threats are targeted against States and not against the industry. Unfortunately, only one 
consumer organisation replied to the questionnaire. Several replie s argued that aviation is at a 
disadvantage in comparison with financing secur ity in other transport modes and that this 
negatively impacts the competitiveness of the European aviation sector. All stakeholder replies endorsed increased c ooperation within the International Civil Aviation Organization 
(ICAO) as the best solution to harmonise intern ational aviation security measures and address 
differences in the level of state-funding be tween the EU and its main trade partners. 
In addition to the questionnair e, a consultation meeting was also held on 17 July 2008 to 
which Member States, some members of the tr ansport committee of the European Parliament 
and the following organisations were invite d: PostEurop, European Regions Airline 
Association (ERA), International Air Transpor t Association (IATA), International Airline 
Association (IACA), European Transport Wo rkers' Federation (ETF), Freight Forward 
International (FFI), European Travel Reta il Council (ETRC), European Shippers Council 
(ESC), European Cockpit Association (ECA ), European Aviation Safety Organisation 
(EASA), European Consumer Centre Network (ECC-Net), Bureau Européen des Unions des 
Consommateurs (BEUC), Forum of European Re gional Airports (FARE), European Business 
Aviation Association (EBAA), Ai rports Council International (ACI), European Low Fares 
Association (ELFAA), Association of Europ ean Airlines (AEA), European Express 
Association (EEA), EUROCONTROL, and Europ ean Association for Fo rwarding, Transport, 
Logistic and Customs Services (CLECAT).  
In advance of the consultation meeting, DG TREN submitted a paper to the invited 
organisations which outlined four different optio ns to address the issue of financing aviation 
security: transparency of security costs, Co mmission approval of mo re stringent measures, 
mandatory "one-stop" security and regulator y convergence through in creased international 
cooperation. The organisations were also invi ted to comment on the consultation paper and 
the discussions in the consultation meeti ng in writing before 1 September 2008. Late 
submitted comments have also been examined. Annex II gives an extensive overview of the replies submitted by the stakeholders. 
In the consultation meeting, all industry organisa tions emphasised that aviation security is a 
state responsibility and the costs should therefor e be borne by the states . IATA compared with 
the situation in the US where the government c overs a substantial share of the total security 
costs. ELFAA made a comparison between the railway sector and short-haul flights. 
Differences in security financing between the different modes of transport may also cause 
distortions of competition. AEA stressed that different levels of security control at different airports strongly affect competition between airlines. 
Members of the European Parliament were al so invited to the meeting on 17 July 2008. One 
Member of the European Parliament argued that increased transparency of security measures and charges are the most important elements. Th is will also allow for a clearer distinction 
between measures that are im posed through the security re gulation and more stringent 
measures imposed by Member States. The same Member of the European Parliament also 
emphasised that the views of the citizens an d the passengers are essential and therefore 
EN 6   EN regretted that the invited representatives from consumer organisations di d have the possibility 
not attend this hearing. 
No Member State has supported an obligation on them to cover security costs. One Member 
State representative stated that  security costs shoul d be seen as a cost of business for the 
aviation sector and therefore paid by the industry.  Other industries have to cover similar costs, 
such as improved safety of cars in the road sector. Another Member State representative 
believed that financing security is a nationa l matter that should be decided by the national 
parliament. Several Member Stat es were cautiously in favour of  more transparency coupled 
with a prohibition of profit-making. It was also  preferred that the Commission should issue 
guidelines rather than  a binding Directive. 
1.2.2 Expertise 
No external expertise was used for this imp act assessment. However, DG JRC estimated the 
impact of some of the measures. The note of DG JRC is attached in Annex XII. This impact 
assessment used statistics that are publicly availa ble, mainly from Eurostat, and also relied on 
statistics provided by stakeholde rs and Member States in thei r replies to the questionnaire. 
Some Member States made it clear that th is information is sensitive and asked the 
Commission to handle it accordingly.  
The preparation of this proposal has been preceded by a report from  the Commission to the 
Council and the European Parliament on Fi nancing Aviation Security COM(2009)30 of 
2.2.2009. The report analysed four i ssues: whether security charge s are exclusively used to 
meet security costs, the transparency of secur ity charges, the impact of aviation security and 
its financing on competition between airports and between airlines, and consumer protection as regards the distributio n of the costs of security measures between taxpayers and users. The 
main conclusion of the report is that transparency  is necessary to ensure that security charges 
do not impact the internal aviation market. 
1.2.3 Opinion of the Impact Assessment Board 
This report was discussed with  the Impact Assessment Board on 14 January 2009. The Impact 
Assessment Board published its opinions on 20 January 2009 and on 24 February 2009. 
The opinions of the Board listed the following recommendations for improvements: 
– To establish more precisely and substantiate the distortions of competition and strengthen 
the case for EU action. Better demonstrate the be nefits and disadvantages of the preferred 
option. 
– Develop the content of the options and expand the availa ble range of alternatives. 
Following these recommendations, the impact a ssessment has been revised along these lines. 
– The economic reasoning has been reinforced  across the report. Complaints on 
discriminatory or excessive security have  been assessed. The case for EU action with 
regard to "one-stop" security could not be substantiated due to  unavailability  of necessary 
data. The report does therefore not anymore suggest any EU ac tion with regard to "one-
stop" security. 
EN 7   EN – The options are described in more detail and explicitly mention, where appropriate, the 
preferred legal instrument. The option on mandat ory transparency without  the possibility to 
appeal security charges has been replaced by an option on increased transparency through 
self-regulation by the industry. This new optio n also covers the case if the Commission 
were to issue non-binding guidelines to address to problems identified. 
SECTION 2: PROBLEM DEFINITION  
2.1 What is the issue or prob lem that may require action? 
2.1.1 Discriminatory and excessive security charges 
Background 
Following the implementation of new European rules in 2002,2 the overall cost of aviation 
security increased. Significant new investments we re necessary, such as the refurbishment of 
some airport terminals and the acquisition of additional screening equipment and recruitment of additional staff to comply with the incr eased requirements on security controls of 
passengers and cargo. 
The three main cost components of aviation securi ty are: airport security costs, airline costs 
and costs for Member States. The main cost con cerns the security controls of passengers and 
cargo at airports. This usually  has two main cost elements : staff costs and costs for 
infrastructure and equipment. The national aut horities are responsible for the provision of 
these services as they are a core state responsibility. The security services are usually 
provided by the national authoriti es themselves or delegated to the airport or to a private 
contractor. 
The Commission published a report on fina ncing of transport security in 2006.
3 To prepare 
for this report, external c onsultants analysed the actual situation and published their 
conclusions in 2004 on the Commission website.4 The conclusions of the study describing the 
actual situation in 2002 can be summarised as follows: 
– The security costs for airports and States in 2002 for the then 15 Member States and 
Norway, Iceland and Switzerland were estimated at €2 billion. Including the costs to the air 
carriers to comply with new European rules, total security costs we re estimated to €2.6 to 
€3.5 billion, which at that tim e corresponded to between 1 and 2 percent of an average air 
fare. 
– These costs to Member States and industry ar e mainly recovered char ges and taxes levied 
on the users of the European air transport system. This is usually referred to as the "user-pays" principle. Airlines, air passengers and cargo shippers cover more than 90% of the 
aviation security costs. Member States only cover 6-7% of the costs through the general 
budget. 
                                                
 
2 Regulation (EC) No 2320/2002 of  the European Parliament and of  the Council of 16 December 2002 
establishing common rules in the field of ci vil aviation security (OJ L 355, 30.12.2002) 
3 COM(2006) 431 final of 1.8.2006. 
4 http://ec.europa.eu/transport/air_p ortal/security/studies/index_en.htm 
EN 8   EN Since 2002 the overall cost for aviation security has decreased as the need for investments has 
reduced. AEA estimated that the average cost  for security per pa ssenger was €2.60 in 2007. 
This gives a total cost of aviation security in  2007 of approximately €1.6 billion for the 27 EU 
Member States.5 
The industry also pointed out during the consultati on that the main tradin g partners of the EU 
cover significant parts of the overall security co sts. In the USA, for example, estimates for 
2006 suggest that 56% of the overall expenditure (US$5 bill ion) has been funded through 
appropriations whereas 38% has been funded th rough user fees paid  by travellers. The 
situation in Japan is similar to the situation in the US. 
Discriminatory security charges 
Air passengers are subject to the same security control and the level of aviation security does 
normally not alter with the destination for intra- EU travel. Consequently, the cost of security 
control is usually the same for a passenger trav elling to a domestic de stination as for other 
destinations within the EU. 
The increased cost of security has given the airlines stronger incentives to minimise these 
costs. An airline may therefore use its bargai ning power, where possible, over an airport to 
modify the structure of security charges. This is most commonly accomplish by setting lower 
level security charges for the traffic segments  where the largest airline has a proportionally 
higher share of the traffic than other airlines operating from the same airport. Lower charges 
for one segment mean that other segments have  to compensate this through higher charges. 
The consequence of this is th at some segments subsidise ot her segments through a charges 
structure that discriminate between categories. 
The national airline usually has the strongest posi tion at an airport. Sometimes this position is 
sufficiently strong to ensure that the airline bene fit from the charges stru cture, usually through 
lower charges for domestic destinations. The national airline has almost always a higher proportion of the domestic traffic. 
Table 1. Security charge per passeng er for intra-EU and domestic travel 
 Intra-EU Domestic 
Romania – Bucharest 
airport €7.50 €3.81 
Spain – all airports €1.39 €1.18 
Cyprus €0.39 0 
Lithuania – Vilnius 
 LTL 8 per tonne of 
Maximum Take-Off Weight of the aircraft. LTL 4 per tonne of 
Maximum Take-Off Weight of the aircraft. 
Source: IATA 
                                                 
5 According to Eurostat, 631.572.637 passengers were departing from an EU airport in 2007. Security 
taxes/fees/charges only are levied on departing passengers.  
EN 9   EN For example, table 1 presents a non-exhaustive overview of airports where security charges 
differentiate between passengers departing to domestic and othe r destinations within the EU. 
Such structures are discriminatory unless it can be shown that they are based on actual 
differences in the cost of security control be tween domestic and other intra-EU destination. 
However, passengers travelling to  domestic or other EU destin ations are normally subject to 
the same security control under circumstances. It is therefore not possibl e to argue that these 
different passenger categories ge nerate different costs and th at the level of the charge 
therefore should differentiated. 
The situation described above mainly refers to th e situation at large airp orts which one airline 
uses as a hub airport. The picture is somewhat different for smaller and regional airports to 
which mostly low-cost airlines operate. At th ose airports, airport an d security charges are 
increasingly set in long-term individual contract s with each airline. These charges are usually 
fixed even if the level of security cost vari es over the duration of the contract. Airlines 
operating from the same airport will therefore f ace different security costs depending on their 
bargaining power and when the contracts were finalised. 
In conclusion, the objective of security charge s is to recover the cost  of protecting citizens 
from terrorist attacks and these charges sh all therefore not discriminate between air 
passengers, airlines or cargo shippers. However,  airlines use their bargaining powers to 
minimise their security costs which risks resulting in discriminatory security charges. In 
addition, discriminatory security charges may impact competition between airlines operating 
from the same airport. The airlines that are discriminated against are disadvantaged over the competitor airlines with lower security costs per passenger. The same market 
Excessive security charges  
Aviation security is a core State responsibil ity and not a commercial  activity that shall 
generate profit. Revenues from security charges shall therefore only be us ed to meet security 
costs. For the purposes of this impact assessment,  security charges that recover more than the 
security costs are considered as excessive. 
As table 1 above shows, some airports differe ntiate security charges between categories of 
passengers. Cross-subsidisation of revenues betw een these categories is often necessary to 
attain for this differentiation. In  a situation where there few or no contributions from the State, 
a cross-subsidisation means that one passenger category has to be overcharged to cover for 
the losses generated by other categories. Di scriminatory charges therefore require that 
excessive security charges are levied on some  passenger categories. Th e Commission has also 
found that discriminatory and excessive security  charges can have implications for state-aid.
6 
Article 5 of the framework Regulation 300/08 on aviation security alre ady requires security 
charges to be cost-related.7 However, this provision is too vague to ensure its applicability 
because only applies as far as may be pr acticable and is therefore not effective. 
                                                 
6 State aid — Germany — State aid C 29/08 (ex NN 54/07) — Germany — Flughafen Frankfurt Hahn 
and Ryanair — Invitation to submit comments pursuant to Article 88(2) of the EC Treaty, (OJ C 12 of 
17.1.2009) 
7 Regulation (EC) No 300/2008 of the European Parliament and of the Council of 11 March 2008 on 
common rules in the field of civil aviation security  and repealing Regulation (EC) No 2320/2002, (OJ L 
97, 9.4.2008, p. 72) 
EN 10   EN  
Security charges 
The authority responsible for aviation security  charges a security tax, fee or, most often, a 
security charge on airlines, passengers and ca rgo shippers, to recove r the cost of airport 
security. Security charges are al most always levied on a per passe nger basis. The level of this 
levy is often based on forecast passengers at the airport and estimated airport security costs. 
Any under- or over-recovery of costs from pr evious years are also taken into account. 
Airports sometimes consult with airlines and airline organisations on  airport and security 
costs. Security charges are distinct from airport charges; security charges shall cover security 
costs while airport charges shall cover mainly terminal and runway costs. The consultations 
often take place on a regular basis, usually once ev ery year to adjust the level of security and 
airport charges to changes in traffic and costs. 
Frequently the relevant author ity delegates the responsibility to implement aviation security 
requirements to the airports, which then are re sponsible for the levying of security charges. 
Annexes I and VI give an overv iew of security costs and corr esponding charges levied at the 
main airport in each Member State. Security charge per passenger can vary between Member 
States. Firstly, the passenger security charge is of ten lower at airports with high traffic due to 
economies of scales which allow the airport to  allocate the cost over more passengers. 
Secondly, security charges are lower in Member States that finance a large share of airport 
security through the public budget. 
In addition to airport security co sts, airlines and Member States also have other security costs. 
These costs usually are not covered by s ecurity charges levied on air passengers. 
2.2 Drivers of these problems 
2.2.1 Lack of transparent security costs Security charges have historically been part of  airport charges which airports levy on airlines 
to recover terminal and runway costs. Recently , all charges are increasingly differentiated to 
adjust to the needs of the individual airline. This has sometimes raised questions with regard 
to the State aid rules as most airports still have significant proportion of public ownership and 
differentiated charges may unjustly benefit one airline over other airlines. Differentiated 
airport charges are not necessarily  discriminatory provided that such differentiation is based 
on objective grounds, such as providing incentives fo r starting-up new routes from an airport. 
The Commission has intervened and developed gui delines over time to clarify how to apply 
the State aid rules on airports.
8 The Commission also clarified in its 2006 report on financing 
of transport security that, measures to protect  European citizens against terrorist attacks are 
not primarily an economic activity as they  are essentially a state responsibility.9 Public 
                                                 
8 Community guidelines on financing of airports and start-up aid to airlines departing from regional 
airports, (OJ C 312 of 9.12.2005)  
9 COM(2006) 431 final of 1.8.2006 
EN 11   EN financing of such measures does therefore not fa ll within the scope of the rules on State aid.10 
However, if security charges recover more th an the security costs such charges are then 
excessive. The additional revenues from excessive  security charges have to be investigated 
under State aid rules. The Commission has rece ntly opened an investigation under the State 
aid rules that an airport set the level of secu rity charges above the level needed to recover 
security cost11. 
Discriminatory or excessive security charge s are not possible to detect without having 
detailed information costs and revenues. Charges for aviation security are seldom levied in a 
transparent manner. Both the re plies from Member States a nd industry organisations made 
this evident.  
The bodies levying security charges – be it either  national authorities or  airports - have no 
incentives to provide airlines with financial information on security costs because this will allow the airlines to criticise the ways the security activities are performed. Airlines and airports have discussed the relevant rate of re turn on security activities. Airlines argue that 
security activities should not generate any retu rn. Airports claim that a reasonable return is 
necessary. Disclosing financial information would inevitable lead to a discussion on 
reasonable rate of return. Member States' views are often close to the airports' because most 
airports are stil l publicly owned. 
In addition, an airline benefiting from differentiated security charges does not require that 
financial information is made public to all ai rlines. Furthermore, th e body levying security 
charges may have other incentives no to fully di sclose all financial information on security 
costs. As the Commission investigation mentioned above found, the revenues from 
overcompensation from security ac tivities may be used to fund activities by the airport are in 
competition with other activities. This overcompe nsation therefore risks distorting the market 
for airport services at an airp ort because the activities being subsidised by security charges 
have an advantage over other activities. 
As pointed out by Peel Airports Group, airport charges and security charges are increasingly 
set in multi-annual contracts betw een airports and airlines. The level of these charges will 
consequently depend on the circumstances when the parties entered the contract and such on 
economic and traffic forecasts made at the time.  Such long-term contracts will increase the 
risk of discriminatory charges. In addition, th e traffic volumes at an airport may change so 
that the security levy is too low to recover the security costs for an ai rline. The airport may 
then recover these losses by overcharging other airlines, air passengers or cargo shippers for 
their security costs. Security charges will therefore become more and more discriminatory and 
excessive over time as the indus try becomes less aware of certai n fundamental principles with 
regard to recovering security costs. 
The replies to the questionnaire c onfirmed that only very few Me mber States have legislation 
in force explicitly prohibiting windfall profits in conjunction with the imposition of security charges/taxes/fees. Other Member States refer to legislation obliging security charges to be based on the actual cost of providi ng the service, which would impl y that the level of security 
                                                
 
10 Community guidelines on financing of airports and start-up aid to airlines departing from regional 
airports, (OJ C 312 of 9.12.2005)  
11 State aid — Germany — State aid C 29/08 (ex NN 54/07) — Germany — Flughafen Frankfurt Hahn 
and Ryanair — Invitation to submit comments pursuant to Article 88(2) of the EC Treaty, (OJ C 12 of 
17.1.2009) 
EN 12   EN charges cannot exceed the cost of security measures. In so me Member States modified 
security charges have to be approved by the au thorities before the entry into force. An 
overview of the replies from Member States to the questionnaire is  given in Annex I. 
2.2.2 Security charges are the onl y airport fees not regulated 
Community law already covers othe r major fees levied on airlines at an airport. The Directive 
on groundhandling opened up the market for passe nger and cargo handling at EU airports. 
The Directive also establishes certain principles for levying the fees the groundhandler has to 
pay to the airport for using airport infrastructure . The aim is that the airport shall not be able 
to use its dominance to levy fees that are abusive. These fees shall therefore be non-
discriminatory and cost-related.12 
The Directive on airport charges has recently entered into force.13 It establishes new European 
rules for levying airport charge s and addresses financ ing airport infrastructure in general.14 
The Directive is based on internationally ac cepted principles al ready endorsed by the 
International Civil Aviation Organization (ICAO)15: transparency, consultation and non-
discrimination.16 An overview of the main elements of  the Directive can be found in annex 
VIII. 
The air transport industry has b een increasingly deregulated duri ng the last 20 years with the 
privatisation of more and more state-owned airlin es and airports. At the same time, previously 
military airfields are being conversed into airpor ts open for commercial traffic. This increased 
competition between airport and between airlines  has led to more consumer choice and lower 
air fares. 
More competition has increased the pressure on  each airport to attrac t traffic by lowering the 
level of airport charges, in particular at sm aller and regional airports where airport charges 
often are set in individual c ontracts with each airline. Airport charges are therefore 
increasingly differentiated according to the indi vidual airline's bargaining power. At the same 
time, very few airports actuall y recover all their costs through airport charges. Airports 
therefore recover more of their costs from ai rlines with a weaker bargaining position than 
from other airlines. Airlines in  a strong position vis- à-vis the airport have  therefore managed 
to have a significant competitive advantage over other airlines operating from the same airport 
through differentiated airport charges. 
In the same way as for airport charges, the in creasingly competitive internal aviation market 
has also drawn airlines' attenti on to security charges. While th e recently adopted Directive on 
airport charges will provide fo r procedures ensuring that ai rport charges are set in a non-
                                                 
12 Council Directive 96/67/EC of 15 October 1996 on  access to the groundhandlin g market at Community 
airports, (OJ L 302 of 26.11.1996, p. 28) 
13 Directive 2009/12/EC of the European Parliament and of the Council of 11 March 2009 on airport 
charges (OJ L 70, 14.3.2009, p. 11) 
14 COM(2006) 820 final of 24.1.2007 
15 ICAO’s Policies on Charges for Airports and Air Navigation Services (Doc 9082/7), 2004, point 15. 
16 In general, a charge, unlike a tax, is levied in return of a service provided to the user. The level of the 
charge should therefore correspond to the cost of providing this service. This is usually referred to cost-
related charges. There is some confusion on the terms used; a charge is often called a tax. If the revenues from the tax are used to cover the cost of  providing a service rendered to a user, it is still a 
charge. This impact assessment do es therefore not make a distinctio n between taxes/fees/charges and 
uses "levy" to cover for all three terms. 
EN 13   EN discriminatory way following a dialogue between airlines and airports, security charges are 
not covered by the Directive. 
2.3 Who is affected, in what ways, and to what extent? 
Three stakeholder groups can be identified as  the most affected: airlines, airports and 
consumers. 
Airlines  pay security charges to the body responsible for airport security – be it either an 
airport or the national authorities. These char ges constitute approxima tely 1 percent of the 
average air fare. Airport security  also often impacts the daily airline operation with delays 
through longer passenger check-ins and increa sed costs to implement requirements specific 
for airlines. Discriminatory security charges im pact the level playing field between airlines. 
Airlines operating to smaller and regional airports are expected to be more affected as security 
charges tend to be more differentia ted among airlines at those airports. 
Airports  provide the facilities and infrastructure to  the security service providers. As airport 
security is an increasingly larg e share of an airport's daily op eration, other airport operations 
are also affected. Aviation secur ity also increases the overall cost  for airports as the airports 
not always can recover the full cost of airport security. ACI stated in its reply that security 
costs account for on average 35 percent of th e airports' operating cost. The corresponding 
figure before the EU aviation security measur es entered into force was 5 to 8 percent. 
Similarly, on average 41 percent of the staff em ployed by an airport is now security related. 
Security costs affect smaller a nd regional airports more than la rger airports with high traffic 
volumes because the cost per passenger decreas es with increases in the passenger volume. 
Consumers  – be they either air passengers or car go shippers – pay the charges levied by the 
airline or the airport. They pay the major shar e of security costs. AEA estimated that the 
average cost for security per passenger was €2.60 in 2007. 
Airport security providers  carry out the actual work of  screening passengers, cargo and 
baggage. This is sometimes done by the airports  themselves or contracted to a private 
company. However, any option studied in this  report is not likely to have any significant 
impact on the security service providers. 
2.4 How would the problem evolve, all thin gs being equal? Should the EU act? 
Without any EU action, the problems identified in paragraph 2.1 will continue to exist and 
probably become more accentuated. 
Firstly, there is an increased risk that security charges will become more discriminatory . 
Individual contracts con cerning airport charges between air ports and airlines are increasingly 
common. During the negotiations of those contra cts, each airline will try to exercise its 
market power. An airport may lower the leve l of charges to attr act a new airline. 
Consequently, it is unlikely that an airport will  levy the same level of charges on all airlines. 
In addition, regional and smalle r airports increasingly regulate  airport and security charges 
through long-term individual contra cts with their airlin e customers. These charges are usually 
fixed even if the level of security cost varies  over the duration of the contract. Such individual 
long-term contracts will therefor e cause further distortions as th ere is an increased likelihood 
of different security charges for the same secu rity control. Airlines operating from the same 
EN 14   EN airport will therefore face diffe rent security costs depending on their bargaining power and 
when the contracts were finalised. 
Secondly, excessive security charges  will not be identified wit hout increased transparency of 
security costs. An airport can therefore use the monopoly it has to provide aviation security 
services at the airport to generate excessive profits. Consequently, the air passengers, airlines 
and cargo shippers will have hi gher security costs than necessa ry. Such excessive profits can 
also be used to subsidise other activities of the airport that are in competition with other providers. For example the groundhandling sect or, where the airport often is providing 
groundhandling services in competition with  other groundhandlers at the airport. 
Thirdly, aviation security is likel y to be provided less efficiently
 over time. The security 
provider is guaranteed to have his costs reco vered through the secu rity charges and has 
therefore no incentives to increase th e efficiency and control the costs. 
Fourthly, an increase in the number of complaints  to national authorities and the Commission 
is expected because security charges are the only airport fees not regulated. The complaint 
will refer to three issues: discriminatory or ex cessive security charges or inefficient provision 
of aviation security at EU airports. 
2.5 Treaty base 
Any new proposal would be based on Article 80(2 ) of the Treaty estab lishing the European 
Community.  
The subsidiarity principle a pplies insofar as a proposal do es not fall under the exclusive 
competence of the Community. 
Diverging security charging systems continue to  exist in the Member States. This situation 
hinders the existence of a true level playi ng field for airports and airlines alike. 
Community action will better achieve the objectives  of the proposal for the following reasons: 
– The application throughout the EU of a co mmon set of basic rules with regard to 
security charges will ensure fair play betw een the aviation partners when defining the 
parameters for levying security charges.  
– Member States implement the general fr amework regulation on aviation security 
differently. This causes unnecessary fragmentat ion of the internal aviation market if 
such measures are not required. A proposal wi ll also seek to im prove the functioning 
of the internal air transport market by addressing aviation security measures that in fragment the market. 
– Diverging security charging systems exist in the Member States. Not all systems 
include fundamental principles which are uniformly applied when security charges are being determined and th e underlying method for their calculation is devised. A 
proposal will aim at achieving such application. 
– Any proposed action should be limited to the definition of a minimum of rules to be 
respected when Member States and/or ai rport operators determine the levels of 
security charges and should not impose a pa rticular security charging system. The 
discretion to define such a system  remains with the Member States. 
EN 15   EN SECTION 3: OBJECTIVES  
The main objectives are to protect consumers' inte rest and to avoid excessive security charges. 
These charges shall therefore neither discrimina te nor recover more than the cost incurred. 
Consequently, the first objective is to protect consumers' interest th rough non-discriminatory 
security charges. The second objective is to avoid excessive security  charges - security 
charges recover more than cost. This should also encourage a more efficient provision of 
security services. 
The State shall therefore not use aviation security to discrimina te between categories of users 
- be they airlines, air passengers or cargo shippe rs. This is one of the actions already requested 
by the mid-term review of the Commission' s 2001 White Paper: 'Keep Europe moving; 
Sustainable mobility for our continent'.17 The review asked for a level playing field to be 
stimulated where the cost of security measures is likely to distort competition and to examine 
the functioning and costs of current s ecurity rules in air transport.  
Furthermore, consumers should have certainty th at revenues from securi ty charges only cover 
security costs. For example, if an airport charges a security charge, the airport shall only be 
compensated for the costs. The 2001 White Pape r: 'European transport policy for 2010: time 
to decide' already drew the attent ion to this right of the users of the transport system to have 
information on what they are being charged for.18 
General objectives Specific objectives 
Protect consumers' interest –  Ensure that security charges do not 
discriminate among airlines, air passengers or cargo shippers 
Avoid excessive security charges –  Ensure that security charges exclusively 
are used to meet security costs 
– Encourage efficient provision of security 
services  
Increased efficiency in providing aviation secur ity services will favour the competitiveness of 
the European aviation sector. A Commission propos al contributes to the objectives of the 
Lisbon strategy to strengthen the competitiveness of the European economy as well as the drive towards "better regulation"  by avoiding discriminatory a nd excessive security charges 
and encouraging an efficient pr ovision of security services. 
S
ECTION 4: POLICY OPTIONS  
The previous analysis has shown that the in creased importance of aviation security is 
affecting the internal aviation market and is ha ving increasingly undesired economic effects.  
Option 2 analyses whether the problems iden tified can be addresse d through self-regulation 
by the industry. Option 3 is as option 2 base d on mandatory transparency, they will be 
                                                 
17 COM(2006) 314 final of 22.6.2006 
18 COM(2001) 370 final of 12.9.2001 
EN 16   EN analysed separately as the increased administ rative costs in option 2 may merit the increased 
efficiency. Option 4 removes the impact of discri minatory charges by obliging Member States 
to pay them. The status quo will be considered as  "option 1" or the base case against which 
the other options will be measured: 
(0) No regulatory action. (1) Transparent security costs thr ough self-regulation by the industry. 
(2) Obligatory transparency of security costs coupled with a require ment that revenues 
from security charges shall be used to exclusively to meet security costs. Airlines should also have the possibili ty to appeal security char ges to a national supervisory 
authority.  
(3) An obligation on Member States to fi nance all airport security measures. 
4.1 Option 1: No EU action 
This option assumes no new EU action. However, this option will have to assess the impact of 
the future Directive of airport charges. 
4.2 Option 2: Self-regulation 
This option suggests that airports and airlines  would cooperate to increase transparency of 
security costs. The aim of this would be to  avoid discriminatory and excessive security 
charges. The industry partie s do not have to develop any guidelines as ICAO 
recommendations on security charges are already exist. As these principles already exist, 
there is no need for the Commission to issue any non-binding recommendations. These 
principles are: 
– Transparency of security costs. The aviati on security provider should present information 
on the cost elements and show how the level of  security charge is arrived at. Usually, all 
the costs of passenger security are divide d by the expected number of passengers. 
– Regular consultations between av iation security providers, air ports and airlines. The costs 
mentioned above should be presented by the s ecurity providers to the airports and the 
airlines on a regular, often yearly, basis and at least before the level of security charge is 
changed. 
– Non-discrimination between airport users. Secu rity charges shall not discriminate between 
airlines, air passengers or car go shippers. Consequently, the le vel of security charge shall 
reflect the cost to which each category of user give raise. 
– Security charges shall not rec over more than the security costs. The level of security 
charge shall not be set than what is necessary  to recover the aviati on security costs. If 
security charges recover more than the co sts during a year, possibly because of an 
unforeseen increase in traffic, this over-recovery  shall be carried over to the next year and 
thereby reducing the cost base for that year. A nd vice-versa if security charges recover less 
than the costs. However, a reasonable rate  of return on invested capital is allowed. 
EN 17   EN 4.3 Option 3: EU Directive on non-discrimi nation, transparency, cost-relatedness 
and possibility to appeal 
Similarly as in option 2, this option would be based on ICAO recommendations for levying 
security charges. However, this option woul d make these four principles legally binding. 
On transparency, the bodies levying the security  charges, which may either be the airport or 
the relevant national authority, will be obliged to make all elements of security charges 
transparent to the airlines: staff costs, numbe r of employees, investments, traffic forecasts 
forming the basis for calculati ng the charges and any under- or over-recovery from previous 
years. Any change in th e level of security charges shall al so be justified by the body levying 
the security charges. 
Regular consultation will become obligatory. The body levying security charges shall present 
this information to the airlines  once a year. This is sufficient because the level of security 
charge does not change more than once a year. Si milarly, airlines that wish to participate in 
these consultation meetings shall provide information their envisaged traffic. This will facilitate and increase the quality of the foreca sts that form the basis for the establishing the 
security charge. However, no airline is obliged to participate in these consultations and has 
therefore no obligation to submit the informati on required to participat e in the consultations. 
This option would still allow the airports and the security service provider to develop the charging system in detail and the exact fare st ructure for different categories of airlines, 
passenger and cargo shippers. 
In addition to the principles outlined in option 2, option 3 would include the possibility for air 
passengers and cargo shippers an d airlines to appeal decision on security charges to an 
independent supervisory authority . The supervisory authority sh all correct security charges 
that are discriminatory or excessive and can be  the same as the authority set up the Directive 
on airport charges. The supervisor y authority also needs to be independent from any airport, 
airline or airport security provi der and shall have sufficient res ources to carry out its work. A 
high level of expertise is also necessary for the authority to promptly assess any complaint 
within and take a decision within a given deadline. 
The Directive on airport charges makes the prin ciples of transparency, consultation and non-
discrimination legally binding for airport charges le vied at airports with  an annual traffic of 
more than five million passengers. Consequently , this option would mainly widen the scope 
of Directive on airport charges to also include security charges. However, this option would 
apply to security charges le vied at all EU airports. 
A Directive would be the preferred legal instru ment for this option. This would allow for 
Member States to align the principles of th is option with existing national principles for 
financing aviation security. 
4.4 Option 4: Full state funding of airport security 
In this option, all Member States  would cover all costs for provi ding aviation secu rity services 
at EU airports. The providers of  airport security would conseque ntly have their costs covered 
by the Member States. No security ch arges would be levied on passengers. 
The preferred option of all industr y representatives is that Member States cover all costs for 
providing aviation security  services, not only airport security costs. At the same time, almost 
every Member State that commented on this option so far made it clear that they are strongly 
EN 18   EN opposing this option and do not want any restric tions on the applicatio n of the "user-pays" 
principle. 
This option could therefore have been discarded at this stage because it interferes with the 
"user-pays" principle for airport security costs and is therefore not likely to be adopted by the 
Council. However, this option will be assessed in the next section because of the strong and 
unambiguous argumentation of all in dustry stakeholders that Member  States should cover, at 
least in part, the cost for states' core activities  such as preventing terro rist attacks on citizens. 
A Regulation amending Regulation (EC) 300/08 would be the preferred legal instrument for 
this option; expanding upon existing  Article 5 on Security Costs. 
SECTION 5: ANALYSIS OF IMPACTS  
The Commission has previously used the estimate s for average price elas ticities in aviation 
for the whole market typically  range between -0.6 and -1.1.19 That document uses a price 
elasticity of -0.8 is an average fo r intra-EU flights. This analys is also assumes that low-cost 
airlines would be more affected than traditional airlines, because of a higher price elasticity of 
demand. The analyses carried out  by DG JRC for this impact assessment produce similar 
elasticities: for trips TRANSTO OLS shows an elasticity of  -0.98, while for passenger 
kilometres all three models used give elasticities in the ra nge of -0.6 to -0.7. 
The 2004 study estimated that security charges ar e approximately between 1 and 2 percent of 
the air fare. The analysis will use the figure pr ovided by AEA that the average security levy 
per departing passenger is €2.60. This is assumed to be 1 percent of the average air fare, as the 
airport security related cost ha s declined since then. This seem s to be reasonable in view of 
the 2007 data published by IATA for air fares for air travel in the EU, even though average air 
fares are notoriously difficult to assess as they  constantly change and relate to commercially 
sensitive information for the airlines.20 
Arriving and departing passengers ar e the most used statistic to pr ovide an estimate of the size 
of an airport, which is also used in the annexe s. However, to assess the impact of the different 
option this report uses departing passengers be cause security charges are almost exclusively 
levied on departing passengers. 
5.1 Option 1: No EU action 
Economic impacts 
• This option is identical to the impact identif ied in the first two scenarios described in 
section 2.4. The two impacts are believed to  be accentuated because the Directive on 
airport charges addresses major char ges other than security charges. 
                                                 
19 SEC(2005)467 of 5.4.2005. Cf. notably Gillen, Morrison, Stewart (2003), Élasticités de la demande de 
transport aérien de passagers: Concepts, problèmes et mesures; DETR (2000), Valuing the external cost 
of aviation, 2000, and DETR, Air traffic forecasts for the United Ki ngdom; Resource Analysis et al. 
(2000), Aviation Emissions and Evaluation of Reduction Options (AERO); ICAO (1995), Outlook for air transport to the year 2003. Elasticities differ be tween different types of flights, being higher for 
short-haul and for leisure flights than for long-haul and for business flights.  
20 IATA Fare Tracker, IATA, 2007. 
EN 19   EN – Security charges could become more discriminatory.  
– Security charges could recover more than the cost of securit y. In addition, there 
will be no incentive for the security providers to improve the efficiency of their activities. 
• If security charges discriminate between air lines, an airline could decide to move its 
operation to another airport. Ho wever, an airline has often i nvested in the airport with 
infrastructure designed for its operations. To mo ve to another airport would also mean that 
the airline would have start-up new routes fr om that airport, with significant marketing 
costs and a loss of customers. Consequentl y, these costs will unquestionably offset any 
possible discrimination in security charges. 
• Security costs are also likely to increase over time because there are no incentives for the 
security providers to improve the efficien cy of their activities. This will generate 
complaints from the airlines. 
Social impacts 
• No social impacts are expected.  
Environmental impacts 
• No environmental impacts are expected. 
5.2 Option 2: Self-regulation 
Economic impacts 
• The impact of 2 is similar to option 1 becau se it is unlikely that self-regulation by the 
industry will effectively protect consumers' interest and pr omote a more efficient provision 
of aviation security services. The ICAO reco mmendations on which this option is based 
were adopted by contracting St ates to ICAO, including all EU  Member States, already in 
1981. Consequently, the industry has had seve ral years already to implement these 
recommendations.  
• As this option is not expected to have any id entifiable impact, neither will it increase the 
burden on business or Member States. The industry does not need to develop the 
guidelines as ICAO recommendations alrea dy provide sufficient level of detail.  
Social impacts 
• No social impacts are expected.  
Environmental impacts 
• No environmental impacts are expected. 
5.3 Option 3: EU Directive on non-discrimi nation, transparency, cost-relatedness 
and possibility to appeal 
Economic impacts 
EN 20   EN • Transparency will allow for airlines to scrutini se the cost components serving as a basis for 
determining the level of security charges levied at the airport. Airlines can then give their 
views on how the revenues from airport char ges are used. By disc ussing the security 
measures and associated costs, better a nd more cost-efficient solutions may be found. 
Transparency will also allow the airlines to discover whethe r other costs than for aviation 
security are included in the cost base for secu rity charges. The discussions will also allow 
incorporating the airlines' traffic forecasts. The design of the security measures depends 
largely on the number of passengers and their de stinations. The input of the airlines and 
their traffic forecasts are therefore valuable with a positive impact on the efficiency of the 
provision of security services. Furthermore, this information also allows for airlines, air 
passengers and cargo shippers to verify wh ether security charges discriminate among 
users. 
• Mandatory transparency allows identifying disc riminatory or excessive security charges. 
However, it may still lead to a lengthy discussion between airlines and airports on how to 
correct such charges. This op tion obliges bodies levying securi ty charges to consult, and 
not to negotiate, with the airlines. A consu ltation means informing and listening airlines, 
while a negotiation would require the actual cons ent of the airlines before introducing new 
charges. AEA identified the following effect s at the airports of  Hannover, Hamburg, 
Stuttgart and Bremen after mandatory consultation and transparency were introduced: 
– More efficient provision of airport secu rity services. For ex ample through more 
efficient screening procedures or changes in  the setup of security infrastructure by 
combining screening points to increase utilisation. 
– Improved passenger forecast that form the basis for calculating the security 
charges 
– Removal of non-secur ity related costs 
– Improved benchmarking with other airports 
• At the four airports mentioned in the point  above, these measures caused the average 
security charge per passenger to fall significantly from 2004 to 2008. Hannover (-10%), 
Hamburg (-15%), Stuttgart (16%) and Brem en (-9%). These experiences show that 
security charges have on average been  reduced by more than 10 percent.  
• A 10% reduction of security cost should then translate into a reduction in the final air fare 
to the air passengers because of competition between airlines. As security costs constitute 1% of the air fare, the competitive pressure in the market would pass on the reduction to the passengers. The air fare is therefore e xpected to be reduced  by 10% of 1% which 
results in a total reduction of 0.1%. 
• A quantitative analysis was made by DG JRC to test the hypothesis of a 0.1 percent 
reduction in total costs, whic h corresponds to a €0.26 reduction in the average air fare for a 
passenger. Three models were used to qua ntify the impact (see box below for their 
description). As expected the different mode ls estimate a negligible increase in air 
passenger traffic (see Annex XII for detailed results). 
– The TRANSTOOLS results confirm the nu mber used in the evaluation, the 
expected increase in to tal passenger traffic would be 0.098 percent while 
EN 21   EN passenger kilometres would be reduced by 0.069 percent. Rail will be affected 
negatively, but to a very limited extent. Rail loses half a million trips a year while air gains 3.2 million trips. Consequen tly, TRANSTOOLS estimates that number 
of air passengers departing from EU airports will increase by 618,941 to 
632,191,578 passengers per year. 
– The POLES results also  agree. Intra-EU air trips ar e expected to increase by 0.074 
percent in terms of passenger kilometres compared to the baseline. The impact on flights between the EU and the rest of  the world would be more limited (as 
expected), the main combinations a ffected being EU27-Mi ddle East and EU27-
Russia and ex-Soviet Union. 
– TREMOVE estimates that intra-EU air trips are expected to increase by 0.063 
percent in terms of passenger kilome tres compared to the baseline.  
• The estimations presented in Anne x XII show that the distributi on of effects is expected to 
be quite uniform among EU-27 member states . However, the increase in demand would 
affect mainly shorter distances (500-1000 km) and non-business trips. Among airports, 
regional and smaller airports serve shorter rout es and are therefore more likely to benefit 
from this increas e in demand than larger airports. Among airlines, low-cost and regional 
airlines are also able to prof it more than larger airlines.
21 
• The administrative burden on the body levying security charges is negligible. There will be 
some increased costs to produce the necessary material for the consultations with the 
airlines. This material is however easily acces sible and its collectio n will therefore only 
give raise to in significant costs.  
– Data on the costs of security staff is acces sible because security staff only perform 
security tasks and therefor e easily identifiable. In addition, the tasks of the 
security staff are often sub-contracted.  
– The cost of additional material, such as screening machines, is easily identifiable 
as such material only can be used to for security activities and therefore not 
possible to allocate to other activities.  
• Option 3 contains the possibility for airlines to appeal decisions  on setting security charges. 
These appeals shall be examined by an indepe ndent supervisory authority that will have 
the necessary competence to quickly examin e any complaint. This will speed up the 
handling of complaints compared with l odging a complaint to the Commission. This 
possibility to appeal could encourage airlines  to submit complaint to delay the introduction 
of new security charges. However, a compet ent independent superv isory authority will 
quickly assess whether the complaints are well-founded or not. This option therefore 
foresees the possibility for the authority to take an interim decision on the entry into force 
of the new security charges. 
• Option 3 will increase the administrative bur den on Member States because this option 
suggests the establishment of a national superv isory authority to examine the complaints. 
The Directive on airport charges will however already oblige Member States to establish 
such authorities. Consequently, these authorit ies will have to assess complaints on security 
                                                 
21 See section 4 "Conclusions" of Annex XII. 
EN 22   EN charges in addition to complaints on airport char ges. This additional task is expected to be 
insignificant and in any case not more than th e cost of one full time staff per Member 
State. 
• However, at airports to which the Directiv e on airport charges does not apply, this means 
at airports with an annual traffic of less 5 million passengers, these consultations would 
have to be established. However, the cost of one yearly meeting between airports, airlines 
and the security service provide rs is very low and not possible to establish. If the smaller 
airports were exempt from this option these airports would not benefit from the expected 
cost reductions. In particular, when these re ductions are expected  to be proportionally 
higher at smaller and regional airport than at larger airports. Neither would the low-cost 
and regional airlines operating to smaller airports benefit. 
• The administrative burden on the Commi ssion to investigate complaints into 
discriminatory or excessive security charges will also be reduced. This reduction will not 
be significant. 
Social impacts 
• No social impacts are expected.  
Environmental impacts 
• The environmental impact is expected to be very  small, because the increase in air traffic is 
estimated to minimal. The modelling exercise estimates that the external cost of the 
environmental impacts would be negligible, totalling less than €1 million per year.22 
5.4 Option 4: Full state funding of airport security 
Economic impacts 
• No security charges will be levied on airports , airlines and consumers, this option would 
therefore remove any discriminatory  aspects of security charges. 
• It is, however, not evident that  this will benefit air passenger s through lower air fares, at 
least not in the short ru n. Airlines may either choose to lo wer the air fares or to increase 
their profits. The airlines' response will depend on a number of factors including: passengers' demand price elasticity, mix of bus iness and leisure passengers, airlines' cost 
structure and response of competitors  to the lower security costs. 
• If one were to assume that there is perfect  competition in the air transport market, the 
airlines would reduce the air fare with th eir lower costs for security. Assuming that 
aviation security is 1 percent of the air fare and a price elastici ty of -0.8 would result in an 
increase in traffic of 0.8 per cent. Departing passengers at EU  airports would then increase 
                                                
 
22 Please see Annex XII, section 3.3.  Environmental Impacts. After estim ating the increase in transport 
demand as a result of the change in air fare, th e corresponding increase in emissions and other 
externalities were estimated. The emission factors from TREMOVE were multiplied by the change in 
passenger kilometres. This was translated into monetary terms using the values from the Handbook for 
the internalisation of external costs where available and for the remaining ones we used TREMOVE 
figures for external costs per passenger kilometre. 
EN 23   EN by 5 052 581 to 636 652 218 using 2007 figures. Similarly, the eff ects quantified in fourth 
bullet point in section 5.3 are e xpected to be ten times higher. 
• As discussed in section 2.1.1, the impact on co mpetition between airports is expected to 
negligible. Competition between airlines is expect ed to be affected in the same way as in 
option 3 through the removal of disc riminatory security charges. 
• The costs for Member States would increase by the same amount as security charges yield 
revenue: this means approximately €1.6 billion per year. 
• There will be little incentives for the provi ders of aviation security to increase the 
efficiency of their operations, because Member  States are required to cover all costs. 
Actually, the security service providers may even reduce their efficiency as this comes at no cost for them. 
• As in option 3, low-cost and regional airlines  that serve regional and smaller airports are 
therefore more likely to benefit from this increase in demand than larger and airlines 
airports.
23 
• An obligation on Member State to cover av iation security costs would also remove 
possible current distortions to competition fr om the existing differe nces between Member 
States in the level of public funding. Howe ver, the Commission concluded in the "Report 
on financing aviation security" competition betw een airports and between airlines is not 
likely to be significantly impact ed by differences in the security levies between Member 
States, provided that such diffe rences do not discriminate be tween airlines, air passengers 
or cargo shippers. Transparency of security cost s is necessary to verify that security levies 
are non-discriminatory and therefore also importa nt to ensure the security levies do not 
distort competition between airlines. 
• The impact on competition between airports and competition between airlines is negligible. 
Airlines operating from the same airport will  benefit equally from any public funding. One 
airline will therefore not have an advantage over the other airline due to the level of public 
funding. An airport located in a Member State with high le vels of public funding could 
have an advantage over an airport located in a different Member State with low levels of 
public funding. For this to have any impact on co mpetition, these airports need to serve the 
same markets. However, it is unlikely that ai rports located in diffe rent Member States 
serve identical markets. In addition, the Commi ssion is not aware that an airline has moved 
its operation from one airport to another airport that serv es the same market due to 
differences in the security costs between the two airports. 
• Option 4 is not expected to have a positiv e impact on competition between airports or 
between airlines. 
Social impacts 
• No social impacts are expected. 
Environmental impacts 
                                                 
23 See section 4 "Conclusions" of Annex XII. 
EN 24   EN • This option would generate the highest increase in traffic, and therefore the largest impact 
on the environment of the opti ons assessed. The environmen tal impact of option 4 is 
expected to 10 times the environmental impact  of option 3, because th e reduction in the air 
fare is 10 times. The environmental impact of option 4 could therefore be estimated to less 
than €10 million. 
EN 25   EN  
The modelling approach by DG JRC 
Three different models, that captur e different aspects, were used: 
TRANSTOOLS: being a network model it can capt ure the impact on modal split. This model 
estimates the impact of a reduction in the ai r fare on number of passenger trips and on the 
total number of kilometres  travelled by passengers. 
POLES: allows the analysis of the impacts at gl obal level. It estimates changes in air traffic 
within and between different regions. The mode l takes the fleet compos ition of the different 
regions into account when estimating the environm ental impact of a change in the air fare. 
TREMOVE: detailed externalities and welfar e module. The model consists of separate 
country models. Each county model describes tr ansport flows and emissions in three model 
regions: one metropolitan area, an  aggregate of all other urban areas and an aggregate of all 
non-urban areas. The model explicitly takes in to account that, depending on the area taken 
into consideration, the relevant modes and network types differ. 
All three models assume that the demand curves  are linear for changes in the airline cost of 
0.005 to 0.1 percent and the resul ting impacts are therefore direc tly proportional to the level 
of change assumed. 
SECTION 6: COMPARING THE OPTIONS  
Each and every option has its advantages and di sadvantages to address the distortions caused 
by the aviation security to the functioning of the internal aviation market. 
The exception may be the non-regu latory option as th is option does not m eet the increased 
focus on security charges that is anticipated with the increasingly harder competition between 
airlines. This option does not require any implementation and is, in addition, supported by 
Member States. 
The non-regulatory option does however not impact on the security measures that distort the 
market for air transport services. Furthermore,  the recently adopted Directive on airport 
charges does not apply to security charges. There is therefore no applicable Community law 
that prohibit security charges to  discriminate among airlines or  passengers. Neither does this 
option ensure that revenues from security charge s exclusively are used to meet security costs 
and thereby protect passenger rights. 
The following table summarises the quantitativ e impacts per year of the options studied. 
Options 1 
No EU action 2 
Self-regulation 3 
Mandatory 
transparency, 
cost-relatedness 
and possibility 
to appeal 4 
Full state 
funding 
EN 26   EN Options 1 
No EU action 2 
Self-regulation 3 
Mandatory 
transparency, 
cost-relatedness 
and possibility 
to appeal 4 
Full state 
funding 
Impact on traffic 0 0 Increase in 
passenger traffic 
by 0.6 million 
passengers per 
year 
(TRANSTOOLS 
estimate) Increase in 
passenger traffic 
by 6 million 
passengers per 
year 
(TRANSTOOLS 
estimate) 
External costs 0 0 €1 million €10 million 
Financial 
impact on Member States 0 0 0 Increased costs 
by €1.6 billion 
Administrative burden on Member States 0 0 Negligible 
negative impact Negligible 
negative impact 
Financial impact on industry and air passengers 0 0 Air passengers 
are expected to 
save €80 million 
and airline 
income is 
expected to 
increase by €60 
million
24 Decreased costs 
by €1.6 billion 
Increased burden of business on industry 0 Negligible 
negative impact 
on airports with 
an annual traffic 
of less than five 
million 
passengers Negligible 
negative impact 
on airports with 
an annual traffic 
of less than five 
million 
passengers 0 
 
The following table summarises the qualitative economic, environmental and social impacts 
of the options studied. 
                                                 
24 See section 4 "Conclusions" of Annex XII. 
EN 27   EN Impact table synthesis 
Options 1 
No EU action 2 
Self-regulation 3 
Mandatory 
transparency, 
cost-relatedness 
and possibility 
to appeal 4 
Full state 
funding 
Economic Impact 
Competitivenes
s of EU 
companies = No impact 
expected = No impact 
expected + Improves 
international 
competitiveness of EU companies ++ Improves 
international 
competitiveness of EU companies 
Competition in the internal market  = No impact 
expected = No impact 
expected + Reinforces 
competition between airlines and between airports = No impact 
expected 
Operating costs and conduct of business = No impact 
expected = No impact 
expected + Reduces cost 
of aviation security through increased efficiency ++ Significant 
reductions in cost of aviation security 
EN 28   EN Options 1 
No EU action 2 
Self-regulation 3 
Mandatory 
transparency, 
cost-relatedness 
and possibility 
to appeal 4 
Full state 
funding 
Administrative cost on business 
 = No impact 
expected = No impact 
expected + Increased 
information on security costs will make it easier for airlines to comply with existing Community law 
-/= Negligible 
negative impact on airports with an annual traffic of less than five million passengers because these airports are not obliged today to establish regular consultation procedures = No impact 
expected 
Innovation and research = No impact 
expected = No impact 
expected + Increased 
transparency and benchmarking between airports will stimulate more efficient airport security =/- No impact 
expected. A State guarantee to always cover security costs may actually create disincentives to find more efficient ways to provide aviation security 
EN 29   EN Options 1 
No EU action 2 
Self-regulation 3 
Mandatory 
transparency, 
cost-relatedness 
and possibility 
to appeal 4 
Full state 
funding 
SMEs: airlines, airports and security providers = No impact 
expected = No impact 
expected + Reduced 
security costs for smaller and regional airports, as well as for low-cost and regional airlines ++ Reduced 
security costs for smaller and regional airports, as well as for low-cost and regional airlines 
Consumer and households = No impact 
expected = No impact 
expected + Non-
discrimination 
+ No 
overcharging for security costs 
+ Reduced 
security costs should reflect in air fares + Reduced 
security costs should reflect in air fares 
Social Impact 
Employment = No impact 
expected = No impact 
expected = No impact 
expected = No impact 
expected 
Environmental Impact 
Air Quality 
 = No impact 
expected = No impact 
expected =/- Negligible 
impact =/- Negligible 
impact 
Climate = No impact 
expected = No impact 
expected =/- Negligible 
impact =/- Negligible 
impact 
Mobility and use of energy = No impact 
expected = No impact 
expected = No impact 
expected = No impact 
expected 
EN 30   EN The impact of the various options on the spec ific is summarised in the following table: 
Specific 
objectives 1 
No EU action 2 
Self-regulation 3 
Mandatory 
transparency, 
cost-
relatedness 
and 
possibility to 
appeal 4 
Full state 
funding 
Security charges do not discriminate among airlines, air passengers or cargo shippers =  
No impact 
expected +/= 
This option is 
unlikely to 
increase the 
transparency of 
security costs 
which makes 
discriminatory 
security charges 
visible. ++ 
This option 
explicitly 
prohibits 
discrimination 
among 
airlines, 
passengers or 
cargo shippers.  ++ 
Discriminatory 
security charges 
will not exist in 
this option 
because it 
abolishes all 
security charges. 
– Security 
charges exclusively are used to meet security costs 
 =  
No impact 
expected +/= 
This option does 
makes excessive 
security charges 
visible but does 
not provide any 
remedies ++ 
A legal 
obligation 
makes this 
obligatory ++ 
This option 
abolishes 
taxes/fee/charges 
which can 
therefore not be 
used for other 
costs 
Encourage efficient provision of security services -/= 
If Member States 
cover all security 
costs, the 
providers of 
aviation security 
have no 
incentives to 
increase their 
efficiency or 
reduce their 
costs. +/= 
No expected 
impact 
 + 
Airlines will 
have access to 
information on 
the 
organisation of 
aviation 
security and its 
costs. Airlines 
can therefore 
suggest 
improvements. - 
If Member 
States cover all 
security costs, 
the providers of 
aviation security 
have no 
incentives to 
increase their 
efficiency or 
reduce their 
costs. 
Option 4 most effectively addresses the concerns  of discriminatory and excessive security 
charges. However, this option discourages a more  efficient aviation security services because 
there are no incentives for the security  providers to control the costs. 
EN 31   EN From the above analysis, it can be concluded th at, considering the market condition today and 
in the coming years, option 3 presents the most favourable combined outcome of the options considered. The increased administrative burd en of option 3 is negligible and clearly 
outweighs its effectiveness in reaching the objec tives. Indeed, its economic impact is more 
positive than the other options while the social and environmental effects are comparable or 
even positive.  
Option 3 most effectively reaches the objectives  set for a proposal on security charges: 
• Option 3 fully meets consumers' interest by explicitly prohibiting discriminatory or 
excessive security charges. 
• Option 3 promotes more efficient provision of s ecurity services and therefore lower overall 
costs for aviation security. 
Option 3 will increase the administrative burden on Member States, compared to option 2. 
However, this increase in administrative burden will be negligible because the independent authority on airport charges established by th e Directive on airport charges may be used. 
Opting for the form of a Directive, and not a regulation, would ha ve the advantage of 
allowing Member States to transpose such principles in line with the implications of diverse legal and administrative systems and thereb y keeping the administ rative burden to a 
minimum. The estimations presented in Annex X II show that the increase in demand would 
affect mainly shorter distances (500-1000 km ) and non-business trips. The distribution of 
effects is expected to be quite uniform among EU-27 member states. 
Option 3 is broadly supported by stakeholders  and Member States. No stakeholder opposed 
option 3, even if option 4 is the preferred op tion by all stakeholders. Member States have 
already in ICAO endorsed the principles on which option 3 is based. This option would 
support Member States' commitment in ICAO to levy more transparent security charges and taxes. Option 3 is based on internati onally accepted principles endorsed by ICAO.
25 
Consequently, option 3 supports and strengthens already existing frameworks at national level 
for levying security charges. 
Option 3 also provides the information necessary for airlines that wish to present security 
charges on the air ticket. Article 23 of the re cently revised third package of air transport 
obliges airlines that present security char ges on the air ticket to quote the correct amount.26 
Consequently, option 3 offers the most efficient overall solution. 
SECTION 7: MONITORING AND EVALUATION  
The Commission will continuously monitor the de velopments in the aviation security sector 
and evaluate on a regular basis the impact of th e proposed legislation. Mo re specifically, the 
Commission will observe market developments with regard to the following issues: 
• The impact on consumers and the aviation industry. 
                                                 
25 ICAO’s Policies on Charges for Airports and Air Navigation Services (Doc 9082/7), 2004, point 29. 
26 Regulation (EC) No 1008/2008 of the European Parliament and of the Council of 24 September 2008 
on common rules for the operation of  air services in the Community (Recast), (OJ L 293, 31.10.2008, p. 
3) 
EN 32   EN • The level of transparency of security costs. 
• The overall cost of aviation security in Europe. 
The core indicators for progress towards meeting the objectives set for this policy initiative 
are the following: 
(1) The number of airports publis hing their security charges. 
(2) Whether there is a reduction in the le vel of security charges in Europe. 
The conclusions of the impact assessment  are based on today's market situation. 
EN 33   EN ANNEX I  
Overview of national legislation  
Member State Transparency and cost-relatedness The main 
source for funding Total 
airport security cost 
Belgium N.A. N.A.  
Bulgaria No particular mechanism that ensures 
transparency or cost-relatedness Users/state € 9 million 
(equals 
€2.89 per 
departing passenger) 
Czech Republic No particular mechanism that ensures 
transparency. Cost-relatedness can be verified when the levying body consults airlines on security charges. Users 450 CZK 
million 
(approx. 
€17 million which equals €2.60 per departing passenger) 
Denmark No particular mechanism that ensures 
transparency. The government ensures that security charges are cost-related. Users  
Germany The government ensures that security 
charges are transparen t and cost-related. Users  
Estonia No particular mechanism that ensures 
transparency or cost-relatedness Users € 6 million 
(equals 
€6.86 per departing passenger) 
Greece No particular mechanism that ensures 
transparency or cost-relatedness Users/state  
Spain Transparency of security charges is 
ensured through legislation. Users/state € 316 
million 
(equals 
€3.04 per departing 
EN 34   EN Member State Transparency and cost-relatedness The main 
source for funding Total 
airport security cost 
passenger) 
France The government ensures that security 
charges are transparen t and cost-related. Users  
Ireland No particular mechanism that ensures 
transparency. The government ensures that security charges are cost-related. Users  
Italy Legislation imposes transparency of 
security charges. The government ensures that security charges are cost-related. Users € 58 million 
(equals 
€0.86 per departing passenger) 
Cyprus Consultation with airlines ensures that 
security charges are transparent and cost-related. Users € 12 million 
(equals 
€3.43 per departing passenger) 
Latvia No particular mechanism that ensures 
transparency or cost-relatedness Users/state  
Lithuania No particular mechanism that ensures 
transparency or cost-relatedness Users/state € 5 million 
(equals 
€4.54 per departing passenger) 
Luxemburg N.A. N.A.  
Hungary No particular mechanism that ensures 
transparency. The government ensures that security charges are cost-related. Users € 25 million 
(equals 
€5.69 per departing passenger) 
Malta N.A. N.A.  
The Netherlands Special legislation ensures that security 
charges are transparen t and cost-related. Users € 253 
million 
EN 35   EN Member State Transparency and cost-relatedness The main 
source for funding Total 
airport security cost 
(equals €9.99 per departing passenger) 
Austria No particular mechanism that ensures 
transparency or cost-relatedness Users  
Poland No particular mechanism that ensures 
transparency. The government ensures that security charges are cost-related. Users € 29 million 
(equals 
€3.21 per departing passenger) 
Portugal No particular mechanism that ensures 
transparency or cost-relatedness Users  
Romania No particular mechanism that ensures 
transparency. The government ensures that security charges are cost-related. Users/state € 62 million 
(equals 
€17.04 per departing passenger) 
Slovenia N.A. N.A.  
Slovakia No particular mechanism that ensures 
transparency. The government ensures that security charges are cost-related. Users 56 SKK 
million 
(approx. 
€1.85 million which equals € per departing passenger) 
Finland Consultation with airlines ensures that 
security charges are transparent and cost-related. Users € 40 million 
(equals 
€4.60 per departing passenger) 
Sweden Mandatory consultation with airlines Users  
EN 36   EN Member State Transparency and cost-relatedness The main 
source for funding Total 
airport security cost 
ensures that security charges are transparent and cost-related. 
United Kingdom No particular mechanism that ensures 
transparency or cost-relatedness Users  
    
Iceland No particular mechanism that ensures 
transparency. The government ensures that security charges are cost-related.  800 IKR 
million 
(approx. 
€2.76 million) 
Norway Consultation with airlines ensures that 
security charges are transparent and cost-related.  1 000 NOK 
million 
(approx. 
€110 million which equals €5.39 per departing passenger) 
Switzerland No particular mechanism that ensures 
transparency or cost-relatedness Users € 96 million 
(equals 
€5.46 per 
departing passenger) 
Source: Replies to the Commission questionnai re (Exchange rates from December 2009), 
Eurostat 
EN 37   EN ANNEX II  
Summary of stakeholders' rep lies to the public consultation  
Below is the summary of the replies to the questionnaire submitted in April and of the 
additional comments in writing submitted afte r stakeholder meeting on 17 July 2008. This 
summary does not disclose information fr om replies indicated as confidential. 
ACI argued that financing aviation security is a State responsibility. Furthermore, mandatory 
application of "one-stop" security is the best avenue for ensuring a comm on security regime at 
EU level which would eliminate redundant and un justified costs. The EU should also be more 
involved when Member States impose more stri ngent measures which should be financed by 
Member States. 
ACI also supports more transparency and clear  principles for levyi ng security charges. 
However, ACI is of the opinion that security  charges will be covere d by the Directive on 
airport charges. This opinion is neither shared by any other stakeholder nor by the 
Commission. 
IATA emphasised that the international air tr ansport industry is con fronted by a financial 
crisis and that in many states outside the EU aviation security is mainly financed by the government. Member States should therefore fina nce aviation security, in particular more 
stringent security measures due to their pot entially distorting effect on competition. IATA 
also argued for EU rules obliging Member States to make an impact assessment when proposing national rules for aviation security. 
IATA also pointed out that ICAO States have ag reed to certain basic principles for levying 
security charges: transparency, non-discrimina tion, regular consultation and cost-relatedness. 
Increased international cooperati on between regulatory authoritie s is therefore a sensible was 
of gradually reaching more consistency between different jurisdictions. However, this would 
not efficiently address distortions of competition from heavily-financed States like the US or 
Japan. 
AEA argued that Member States should finance an increased share of security costs. AEA 
strongly supported obligatory tran sparency of security costs. This would provide the 
necessary tools to measure the efficiency and th e performance of the secu rity services charges 
by airports to airlines. 
AEA also estimates that 30% to 50% of the se curity costs are induced  by EU legislation. In 
2007, the average estimated cost per passenger fo r security measures carried directly by 
airlines was around 2.50€, while at airports not applying "one-stop" security the average 
security costs is approximately 8.50€. Mandatory "one-stop" security w ould decrease security 
costs and eliminate redundant security measures. 20% of transfer passengers in some Member States are today re-screened when ar riving from another Member State. 
However, there is no transparency in Member  States about which measures are imposed by 
EU requirements and which are imposed by more  stringent measures. AEA also pointed out 
there is no clear and common definition of what constitutes a more stringent measure. AEA supported argued that Member States should no t impose additional stringent measures and 
should finance existing more stringent measures . AEA also suggested that Member States 
communicate to the Commission measures that ar e applied inn addition to EU requirements. 
EN 38   EN In addition, the Commission should provide a thorough impact and costs analysis before 
proposing new security measures. 
ELFAA highlighted the way aviation security is  financed in the EU puts aviation at a 
disadvantage compared to other transport modes. Security is the respon sibility of the State 
and should therefore not be financed by the industry according to the "user pays" principle. The consequence is that Member States have lit tle incentive to remove any redundant security 
measures because they have no responsibility for meeting the costs. ELFAA also argues that aviation security causes considerably inconvenience for the travelling public. 
FARE argued as well that financ ing aviation security is a Stat e responsibility. The cost of 
aviation security per passenger is also higher at smaller airports than at larger airports. Furthermore, Member States should demonstrate that more stringent measures are justified 
and proportionate. The "user-pays" principle put s European airports in an increasingly 
disadvantaged position compared to airports in the US with the entering into force of the EU-
US Open Skies agreement. 
IACA argued that States should finance aviation security because terrorism targets 
governments and not airlines. European airlin es are disadvantage compared to its global 
competitors because of the application of the "user-pays" principle in Europe. IACA supports 
mandatory "one-stop" security and increased tr ansparency of security costs. IACA also 
questions why airlines should co llect the revenues from the security charges from passengers. 
ERA stated that States have the responsibility fo r the protection of citize ns in the air and on 
the ground and should therefore finance aviation security. 
EEA argued as well that financing aviation security is a State responsibility. More stringent 
measures should therefore be financed by Memb er States. Differences in financing aviation 
security globally affect negatively the EU.  
CLECAT requested increased level of state fi nancing and a more harmonised approach to 
aviation security to decrease the burden on the industry. CLECAT argued that transparency of 
security costs is necessary to avoid overchar ging and discrimination. Th e only effect way to 
address this effectively is thr ough EU action. A Directive on transparency would not address 
the disadvantages EU operators face in comparis on with operators based in  states with a high 
level of public financing. 
ESC explained that the costs for security scre ening of cargo have increased significantly over 
the last years. ESC therefore in its reply focuse d on the lack of transparency of security costs 
and charges paid by the cargo shippers. However, transparency should extend to cargo shippers and not only to airlines . Cargo shippers can today not ve rify whether the security fee 
levied on cargo shippers  by airlines corresponds to the actual costs. 
ESC argued that administrative burden and costs for companies need to be addressed when 
new security regulations are being introduced. The costs for measures protecting the state 
should be at the very least shared with the state. ESC also supported more harmonisation of 
principles for financing aviation security w ithin ICAO. However, ESC emphasised that the 
EU institutions are more efficient in ensuring adherence to the principles of transparency, 
consultation and cost-relatedness. 
Peel Airports Group highlighted that aviation security represen t a significant part of the 
airport costs and that these cost are expected to  continue to grow. More stringent measures put 
EN 39   EN financial pressure on smaller regional airports. The cost for security per passenger is already 
high at smaller airports compared  to larger airports. Peel Ai rports Group also claimed that 
competition between regional airports is distorte d through differences in  the level of public 
funding in the EU. Peel Airports  Group pointed out that long-ter m contracts between airlines 
and airports have become increasingly common w ith the advent of low-cost airlines. These 
contracts also set security fees at a fixed and often low level while security costs may change 
over time; particularly if more stringent measures are introduced. 
EN 40   EN ANNEX III  
EU airlines (first half 2007)  
 Number of airlines Number of employed persons 
Belgium 13 4005 
Bulgaria 14 1493 
Czech Republic 7 5487 
Denmark 10 3242 
Germany 48 57761 
Estonia 6 576 
Greece 8 7038 
Spain 20 8281 
France 45 34864 
Ireland 34 78375 
Italy 37 16531 
Cyprus 6 2021 
Latvia 6 1144 
Lithuania 7 834 
Luxemburg 4 3690 
Hungary 8 3124 
Malta 4 1883 
The Netherlands 12 41124 
Austria 20 11081 
Poland 10 4540 
Portugal 14 8251 
Romania 5 3438 
Slovenia 3 592 
EN 41   EN Slovakia 5 278 
Finland 7 10345 
Sweden 30 2637 
United Kingdom 83 83160 
TOTAL 466 420276 
Source: Airclaims 
EN 42   EN ANNEX IV  
EU airports open for commercial traffic (2007)  
 Number of airports Departing passengers 
Belgium 5 10,429,410 
Bulgaria 4 3,117,117 
Czech Republic 4 6,548,515 
Denmark 10 12,912,990 
Germany 38 93,976,756 
Estonia 1 874,841 
Greece 39 15,305,163 
Spain 39 20,784,541 
France 65 103,808,025 
Ireland 9 73,518,196 
Italy 43 67,388,733 
Cyprus 2 3,494,389 
Latvia 2 1,581,409 
Lithuania 3 1,100,561 
Luxemburg 1 822,328 
Hungary 3 4,390,748 
Malta 1 1,485,616 
The Netherlands 5 25,315,234 
Austria 6 11,802,865 
Poland 10 9,025,858 
Portugal 10 13,430,040 
Romania 9 3,615,634 
Slovenia 1 752,292 
EN 43   EN Slovakia 6 1,205,653 
Finland 26 8,701,088 
Sweden 30 16,608,182 
United Kingdom 59 119,576,453 
TOTAL 431 631,572,637 
Source: Eurostat 
EN 44   EN ANNEX V  
Glossary  
Government  
International Civil Avia tion Organization (ICAO) 
European Aviation Safety Organisation (EASA) EUROCONTROL 
Stakeholders
 
PostEurop 
European Regions Airline Association (ERA) International Air Transport Association (IATA) International Airline Association (IACA) European Transport Workers' Federation (ETF) Freight Forward International (FFI) European Travel Retail Council (ETRC) European Shippers Council (ESC) European Cockpit Association (ECA) European Consumer Centre Network (ECC-Net) Bureau Européen des Unions des Consommateurs (BEUC) Forum of European Regional Airports (FARE) European Business Aviation Association (EBAA) Airports Council Internati onal - Europe (ACI-Europe) 
European Low Fares Association (ELFAA) Association of Europ ean Airlines (AEA) 
European Express Association (EEA) European Association for Forwarding, Transpor t, Logistic and Customs Services (CLECAT) 
EN 45   EN ANNEX VI  
Passenger Security and Service Charge  
 
Source: IATA 
EN 46   EN ANNEX VII  
Comparison of Passenger Service and Security Charge  
0%20%40%60%80%100%
BrusselsSofiaPrague
Copenhagen
Frankfurt
Tallinn
Athens
Madrid
Paris
Dublin
Rome-FCO
Larnaca
Riga
Vilnius
LuxembourgBudapestLuqa
SchipholViennaWarsaw
Lisbon
Bucharest
Ljubljana
Bratislava
Helsinki
Stockholm
London
Airports
Passenger Service Charge Security Charge 
Source: IATA 
EN 47   EN ANNEX VIII  
Main provisions of the 2009/12 Di rective on airport charges  
Scope:  
• The Directive applies to all airports with mo re than five million passengers (departing and 
arriving) per year. 
• It also applies to the largest airport in every Member State 
• The Directive covers charges levied by airports to cover the cost for landing, take-off, 
processing of passengers and cargo. 
Consultation:  
• Regular consultations between  airlines and airports 
Non-discrimination:  
• Airport charges shall not discriminate among airlines 
Transparency:  
• Airports shall provide airlines with informa tion on the cost for provi ding the services for 
which airport charges are levied. 
Appeal:  
• Each Member State shall establish an  independent supervisory authority 
• This authority will assess complaints from airlines concerning airport charges. 
EN 48   EN ANNEX IX  
Main provisions of the Regulation (EC)  No 300/2008 on Civil Aviation Security  
Airport Security  
• Staff Access Control (100 percent control of critical areas) 
Aircraft Security  
• Searching and checking of aircraft 
• Protection of parked aircraft 
Passengers and Cabin Baggage  
• 100 percent screening of all departing passengers and their cabin baggage 
• Separation of arriving an d departing passengers 
• Facilitation for passengers al ready screened intra-EU 
Hold Baggage  
• 100 percent screeni ng of hold baggage 
• Protection of already screened hold baggage 
• Reconciliation of hold baggage 
Cargo / Mail  
• Various control requirements 
• Rules for regulated ag ents /known shippers 
Security Equipment  
• Technical performance parameters 
List of Prohibited Items  
• Metallic items 
• Liquids  
 
EN 49   EN ANNEX X  
The largest EU airport groups  
Rank 2007 
(EU) Rank 2007 
(World) Rank 2006 
(World) Airport Member State Main 
Airport(s) Revenue 
($million) 2007 Net result 
($million) 2006 Net result ($ 
million) 
1 1 4 Ferrovial Spain Heathrow, 
Gatwick, 
Stansted 5309,7406 698,976 117,3273 
2 2 1 Aena Spain Madrid, 
Barcelona, 
Mallorca 4103,0439 0 -33,3613 
3 3 2 Fraport Germany Frankfurt 3337,7478 287,158 289,2813 
4 4 3 Aéroports de 
Paris France Charles de 
Gaulle, Orly 3154,1978 442,7765 192,1595 
5 7 7 Schiphol Group The 
Netherlands Amsterdam 1576,8237 434,7961 664,8549 
6 13 13 Flughafen 
München Germany Munich 999,6 49,749 61,5 
7 15 15 Luftfartsverket Sweden Arlanda, 
Gothenburg, 
Malmö 932,5408 -81,0194 60,9752 
8 16 17 Dublin Airport 
Authority Ireland Dublin 858,5021 478,1739 209,2426 
9 20 18 Manchester 
Airports Group UK Manchester, 
Nottingham, 
Bournemouth 795,7408 162,4864 128,746 
 
EN 50   EN Rank 2007 
(EU) Rank 2007 
(World) Rank 2006 
(World) Airport Member State Main 
Airport(s) Revenue 
($million) 2007 Net result 
($million) 2006 Net result ($ 
million) 
10 21 19 Aeroporti di 
Roma Italy Fiumicino, 
Ciampino 765,8685 24,6169 75,6951 
11 23 27 Flughafen Wien Austria Vienna 717,4465 120,3312 97,8371 
12 24 25 SEA Aeroporti 
di Milano Italy Malpensa, 
Linate 709,2955 41,8285 44,6601 
13 31 32 Flughafen 
Düsseldorf Germany Düsseldorf 552,8515 56,1382 25,3578 
14 32 35 Athens 
International Greece Athens 549,6868 172,9553 121,4906 
15 33 30 Copenhagen 
Airports Denmark Copenhagen 540,0799 205,4431 123,2179 
16 36 36 Brussels Airport 
Company Belgium Brussels 505,1064   
17 42 45 Aeroportos de 
Portugal Portugal Lisbon, Faro 413,703 66,6187 54,6405 
18 43 44 Abertis Spain Luton, Cardiff, 
Belfast 412,7811  27,775 
19 45 48 Finavia Finland Helsinki 399,2969 43,2044 28,7641 
20 48 49 Flughafen Köln-
Bonn Germany Cologne 378,1419 7,5781 6,333 
21 54 56 Flughafen 
Hamburg Germany Hamburg 322,2513 66,3202 48,1585 
 
EN 51   EN Rank 2007 
(EU) Rank 2007 
(World) Rank 2006 
(World) Airport Member State Main 
Airport(s) Revenue 
($million) 2007 Net result 
($million) 2006 Net result ($ 
million) 
22 55 57 Flughafen 
Berlin-Schönefeld Germany Schönefeld, 
Tegel, 
Tempelhof 321,0321 22,9933 5,6696 
23 60 59 Flughafen 
Stuttgart Germany Stuttgart 297,2024  53,177 
24 63 68 Czech Airports 
Authority Czech 
Republic Prague 267,4151 55,1581 43,4245 
25 68 50 Polish Airports 
State Enterprise Poland Warsaw 247,4722 51,3325 67,4746 
26 72 69 Budapest-
Ferihegy Airport Hungary Budapest 229,5063   
27 76 73 Birmingham 
Airport Holdings UK Birmingham 221,1081 46,0452 22,9537 
28 79 83 Aéroports de la 
Côte d'Azur France Nice 188,13   
29 80 78 Hannover-
Langenhagen Germany Hannover 188,1291 10,5591  
30 86 86 Lyon-Saint 
Exupéry France Lyon 165,1124 0,688 0 
31 87 88 SAVE 
Aeroporto 
Marco Polo Italy Venice 151,3531 40,1774 31,0653 
32 92 98 Toulouse-France Toulouse 119,7065   
 
EN 52   EN Rank 2007 
(EU) Rank 2007 
(World) Rank 2006 
(World) Airport Member State Main 
Airport(s) Revenue 
($million) 2007 Net result 
($million) 2006 Net result ($ 
million) 
Blagnac 
International 
33 99 101 Peel Airports UK Liverpool, 
Doncaster, 
Durham, 
Sheffield 105,4794 3,0868 -3,3774 
Source: Airline Business 
 
EN 53   EN ANNEX XI  
Main references  
• Study on Civil Aviation Security Financing , September 2004, Irish Aviation Authority and 
aviasolutions; see h ttp://ec.europa.eu/tran sport/air_portal/secur ity/studies/index_en.htm 
• Consultation Paper - The Financing of Av iation Security: An Issue for Community 
Legislation? 
• White Paper - European transport policy for 2010: time to decide , September 2001, 
European Commission 
• KeepEurope Moving – Sustainable  mobility for our continent , Mid-term review of the 
Euroepan Commission's 2001 transport White Paper, June 2006, European Commission 
• ICAO's Policies on Charges for Ai rports and Air Navigation Services , Doc 9082, seventh 
edition, 2004, Intern ational Civil Aviation Organization 
• Airport Economics Manual , Doc 9562, second edition, 2006, In ternational Civil Aviation 
Organization 
• Airport and Air Navigation Manual , April 2008, International Ai r Transport Association 
• JRC Tenchical Note – modellin g the impact of m odifying airport security financing, 
December 2008, DG JRC  
• First Look at Dela ys in October 2008,  November 2008, Eurocontrol  
• Air Passenger transport in Europe in 2007, August 2008, Eurostat 
• IATA Fare Tracker , IATA, 2007. 
 
EN 54   EN ANNEX XII  
JRC TECHNICAL NOTE  
MODELLING THE IMPACT OF MODIFYIN G AIRPORT SECURI TY FINANCING 
 EUROPEAN COMMISSION 
DIRECTORATE-GENERAL JRC 
JOINT RESEARCH CENTRE
  
Seville, 9 December 2008 
JRC  TECHNICAL NOTE  
MODELLING THE IMPACT OF MODIFYING AIRPORT SECURITY FINANCING  
Final draft27 
This note summarises the results of the simulations carried out by JRC/IPTS with the 
TRANSTOOLS, POLES and TREMOVE models in the context of the Impact Assessment of 
the proposal on airport security financing (COM /2008/xxx). The results of all three models 
suggest that the increase in tr ansparency and the accompanying decrease in user costs will 
have a positive economic while the envir onmental impact will be negligible. 
1. Background 
Airport security costs have incr eased significantly since 2001 as a result of tighter control and 
new regulations. Although raising the standards for security cont rols is arguably necessary for 
the prevention of further terrori st attacks, the increase in co sts for airports, airlines and 
travellers may result in an obstacle for economic activity and competition. 
In addition, the application of  security regulations is not harmonized across the EU, while 
there is limited or no transparency as regard s the repercussion of the additional costs on 
stakeholders and users. This may lead to s ituations of discrimina tion among users and can 
distort competition between airports and/or airlines. 
The proposal of the European Commission aims to remove the distor tions on the aviation 
market caused by aviation security measures. This  is one of the actions requested by the mid-
term review of the Commission's 2001 White Pa per: 'Keep Europe moving; Sustainable 
mobility for our continent'.28 The review asked for a level playing field to be stimulated where 
the cost of security measures is likely to distort competition and to examine the functioning and costs of current security rules in air transport. The Commission should, consequently, 
propose adjustments where needed to avoid distortion of competition. Furthermore, 
consumers should have certainty that revenues from security charges only cover security 
costs. For example, if an airport charges a security charge, the airport shall only be 
                                                
 
27 Contact persons at JRC: P. Christidis, E. Navajas Cawood 
28 COM(2006) 314 final of 22.6.2006 
 
EN 55   EN compensated for the costs. The 2001 White Pape r: 'European transport policy for 2010: time 
to decide' already drew the attent ion to this right of the users of the transport system to have 
information on what they are being charged for.29 
The proposal considers four policy options: 0. No regulatory action 1. Obligatory transparency of security costs.  This option also rem oves any re-screening 
of passengers arriving from a nother EU Member States. 
2. Obligatory transparency of security costs coupled with a require ment that revenues 
from security charges shall be used to exclusively to meet security costs. Airlines should also have the possibility to appeal security charge s to a national supervisor y authority. This option 
also removes any re-screening of passengers arriving from another EU Member States. 
3. An obligation on Member States to finance all aviation security measures. This option 
also removes any re-screening of passengers arriving from another EU Member States. 
2. Modelling approach followed 
Given the nature of the policy op tions, the aim of the simulation with the three models was to 
estimate the expected impacts on transport, ec onomic activity and the environment under the 
assumption that the measures included in the pr oposal will lead to a de crease in costs for the 
final user, the traveller. The qualitative analysis  of the impact assessment, based on research 
and input from the stakeholders, identified a re ference value of cost reductions equal to 0.1% 
of the average ticket, or the equivalent of 0.26 € per trip.  
Sensitivity tests were performed with all three models used. Their demand curves are 
apparently linear for changes in the user co sts between 0.05% and 1%  and it can be thus 
considered that the resulting impacts are direct ly proportional to the le vel of change assumed. 
For example, if the real change in user costs is  half of what is assumed in the simulations, the 
level of the impact forecasted by the models woul d be half of what corresponds to the change 
of 0.1%. 
Since each model uses a different modelling appr oach, providing useful details in different 
aspects, it was considered appropriate to appl y all three models in th is simulation. The main 
strength of each model can be summarised as follows: 
TRANSTOOLS: being a network model it can ca pture the impact on moda l split. In addition, 
passenger transport demand has been calibra ted and is modelled at NUTS 3 level. 
POLES: allows the analysis of the impacts at global, international level. TREMOVE: detailed external ities and welfare module  
The reaction of all three models to the policy "s hock" was quite similar and their results were 
comparable. 
TRANSTOOLS
 
                                                 
29 COM(2001) 370 final of 12.9.2001 
 
EN 56   EN TRANSTOOLS version 1.7.4 was used for this Impact Assessment, the latest validated 
version available. Since only pass enger transport is expected to  be affected directly by the 
measures, and because any secondary effects woul d be negligible given the limited first-order 
effects, a simplified setup of the model was applied, using only the a ssignment and passenger 
modules.  
Figure 1: Setup of TRANSTOOLS model 
  
The policy measure was simulating by introduc ing two changes into the model's input 
database: 
Network.mdb>AirLink table-> decrease of CostB, CostP and CostH by 0.26 euros 
Passenger_inputs.mdb>ChangeOfTransportationCosts  table -> mode 3, all countries, change 
= -0.01 
Running the assignment module first allows the m odel to update the Origin-Destination costs 
matrices. The passenger model re -estimates demand based on the updated O-D matrices. The 
resulting matrices after both assignment and passenger demand can be compared to the ones 
from the "do nothing" case, their difference being the expected impact of the policy measure.  
The time horizon for the simulation was year 2012.  
POLES  
In POLES it was assumed that the policy measure would lead to a reduction of ticket prices 
by 0.1% by decreasing the part of the price th at does not depend on ope rating expenses. As 
seen in figure 2, this change would affect th e modelled demand directly and would lead to a 
new market equilibrium. 
POLES was run for the period 2010-2020. Figure 2: POLES-aviation model structure 
 
EN 57   EN  
TREMOVE  
Version 2.7 of TREMOVE was used. Usage costs for air transport were reduced by 0.1% in 
private (non-freight) transport by plane, a category that involves both leisure as well as 
business trips. This reduction of  costs affects transport demand, wh ich in turn wi ll eventually 
contribute to the recalculation of generalized costs (user price, tax or subsidy and time cost) 
and this is used in further iterations to recalculate demand until a new equilibrium is reached by the model. The emissions module estima tes new levels of GHG caused by transport 
activity.  
More specifically, the demand module in TREMOVE  stratifies transpor t demand according to 
the purpose of the trips, effectively implem enting a differentiated modal choice tree for 
freight and passenger transport. For the latter, a further differentiation is introduced between 
work and private trips. The reason for this is th at the purpose of transport affects the decision 
process concerning modal choice. In the current s cenario, the reduction of flight ticket fare is 
applied to overall air passenger transport, incl uding business trips and private traffic – even 
though the latter accounted for the 90% of gr owth in demand for this mode, which is 
consistent with the fact that the elasticities are slightly larger in the case of leisure trips.  
Finally, the welfare module calcul ates the difference in welfar e between the basecase ("do-
nothing" scenario) and the simulated policy. This difference in social welfare is calculated as 
the sum of different components (change in uti lity of households, production costs, external 
effects and taxes or subsidies). 
Figure 3: TREMOVE structure Expected 
Current and 
Fleet by 
Current Survival 
rates
Fleet use 
Energy 
Pollutant km and h flown Expected 
Effective 
Supplier 
Market Market 
Operating 
Fuel Load Technical Capacity 
Energy use CtMk t t h
GDP 
 
EN 58   EN 
 
TREMOVE does not represent explicitly vehicl e-km by planes. Vehicle stock module is not 
thus affected by air transport - neither plane fleet  is recalculated or estim ated Furthermore, the 
TREMOVE plane volumes refer to the amount of flights starting in  the considered country (so 
flights with departure outs ide Europe are ignored).  
Occupancy rates are fixed (0.7, derived from TRENDS), used to convert seat-km into pmk as 
well as emission factors per pkm per dist ance class (all derived form the TRENDS 
AVIOPOLL database) 
 
EN 59   EN  
3. Results 
The results of all three models  coincide in the positive impact  for air transport demand, the 
benefits for users and airlines and the limited environmental impact. 
3.1 Transport demand and activity  
The measure simulated (equivalent to a decrease  of 0.1% or €0.26 per tick et) is expected to 
lead to an increase in the demand for air tr ips by the same proportion (0.1%) according to 
TRANSTOOLS (the only model of  the three that estimates trips). Transport activity, 
measured in passenger*kms, is expected to gr ow by a lower rate, since the majority of the 
increase in demand would consis t of shorter distance trips. One third of the increase in 
demand is expected to come from modal shift fr om (fast) rail, while the remaining two thirds 
would be a net increase in demand for air transport. 
The results of TRANSTOOLS also imply that the increase in air transport demand would 
mainly come from non-business trip s of distances lower than the average for air transport. The 
decrease in costs as a result of the policy measure simulated is a very small share of ticket 
price and total generalised costs and as a result  would affect only the parts of the transport 
market most sensitive to ticket  prices. Modal shift from rail to air would be probable in 
member states where rail ha s a significant share of long distance transport demand. 
The transport impacts are distributed quite evenly among the EU-27 member states, with 
Finland, France, Germany, Sweden and Romania s howing an expected in crease in air trips 
higher than the average, while Cyprus and Malt a are expected to have  a very limited reaction. 
POLES and TREMOVE results until  2030 suggest that the relative impact of the measure on 
air transport activity would remain constant a nd in the order of 0.06-0.07% for intra-EU trips. 
Table 1: Summary of results on transport impact  
Policy test= reduction of average air ticket cost by 0.1%, EU27, year 2012  
 baseline policy test difference change% 
air trips, intra-EU27 (million) 332.2 332.5 0.3 0.10% 
air volume, intra EU-27 (billion pass*km) 289.3 289.5 0.2 0.07% 
air volume, to/from rest of the world (billion pass*km) 382.6 382.7 0.1 0.03% 
     
rail trips, intra-EU27 (million) 1212.3 1212.3 -0.1 0.00% 
rail volume, intra-EU27 (billion pass*km) 239.9 239.9 -0.1 -0.02% 
source: TRANSTOOLS for EU-27, POLES for rest of the world 
Table 2: Comparison of model results, air transport activity (pass*kms), intra-EU27, year 2012 
 
EN 60   EN Model Expected 
change due to 
policy measure 
TRANSTOOLS 0.069% 
POLES 0.074% 
TREMOVE 0.063% 
 
Table 3: Transport impact at country level, year 2012, TRANSTOOLS results 
 Trips Activity 
(pass*kms) 
Austria 0.074% 0.058% 
Belgium 0.087% 0.073% 
Bulgaria 0.096% 0.198% 
Cyprus 0.028% -0.043% 
Czech Republic 0.048% 0.029% 
Denmark 0.098% 0.118% 
Estonia 0.097% -0.033% 
Finland 0.155% 0.150% 
France 0.155% 0.140% 
Germany 0.131% 0.101% 
Greece 0.071% 0.021% 
Hungary 0.080% 0.077% 
Ireland 0.062% 0.038% 
Italy 0.097% 0.075% 
Latvia 0.082% 0.084% 
Lithuania 0.059% 0.036% 
Luxembourg 0.056% 0.015% 
Malta 0.002% -0.008% 
Netherlands 0.074% 0.052% 
 
EN 61   EN Poland 0.091% 0.084% 
Portugal 0.073% 0.044% 
Romania 0.102% -0.020% 
Slovakia 0.080% 0.041% 
Slovenia 0.064% 0.083% 
Spain 0.067% 0.036% 
Sweden 0.112% 0.116% 
United Kingdom 0.086% 0.045% 
 
 
EN 62   EN  
Table 4: Impact on air transport activity, international trips, POLES results, change in pass*kms 
 2012 2013 2014 2015 2016 2017 2018 2019 2020 
Intra-EU27 0.0738% 0.0576% 0.0645% 0.0636% 0.0648% 0.0648% 0.0652% 0.0661% 0.0664% 
To/from  
Middle 
East 0.0465% 0.0498% 0.0497% 0.0506% 0.0506% 0.0505% 0.0506% 0.0510% 0.0509% 
To/from 
Russia and 
former 
USSR 0.0398% 0.0462% 0.0450% 0.0466% 0.0463% 0.0472% 0.0477% 0.0467% 0.0460% 
To/from 
Africa 0.0319% 0.0381% 0.0372% 0.0378% 0.0378% 0.0376% 0.0376% 0.0336% 0.0347% 
To/from 
North America 0.0307% 0.0296% 0.0304% 0.0304% 0.0305% 0.0305% 0.0306% 0.0308% 0.0308% 
To/from 
South America 0.0271% 0.0337% 0.0285% 0.0305% 0.0299% 0.0300% 0.0300% 0.0303% 0.0302% 
To/from 
South-East 
Asia 0.0224% 0.0304% 0.0289% 0.0300% 0.0296% 0.0295% 0.0293% 0.0295% 0.0294% 
To/from 
Central 
America 0.0220% 0.0318% 0.0301% 0.0273% 0.0251% 0.0256% 0.0253% 0.0259% 0.0258% 
To/from 
South-
West Asia 0.0216% 0.0297% 0.0279% 0.0293% 0.0294% 0.0293% 0.0293% 0.0297% 0.0296% 
To/from 
North-East Asia 0.0206% 0.0289% 0.0270% 0.0280% 0.0280% 0.0280% 0.0280% 0.0283% 0.0283% 
To/from 
Oceania 0.0195% 0.0302% 0.0287% 0.0297% 0.0297% 0.0295% 0.0296% 0.0300% 0.0268% 
To/from 
China 0.0193% 0.0322% 0.0268% 0.0297% 0.0285% 0.0285% 0.0281% 0.0289% 0.0286% 
 
Table 5: Long term impact on transp ort activity, TREMOVE results, EU-27 
 2012 2015 2020 2025 2030 
 
EN 63   EN Impact on air 
transport activity 
(change in pass*kms) 0.063% 0.063% 0.064% 0.064% 0.064% 
 
 
EN 64   EN  
3.2 Economic impacts  
The results of TRANSTOOLS and TREMOVE coinci de in that they expect visible economic 
impacts from the reduction of security costs. 
Table 6: Economic impacts, TRANSTOOLS and TREMOVE, reference year 2012  
economic impact Difference (€ 
million/year) 
Increase in consumer surplus (travellers), TRANSTOOLS 86.4 
Increase in airline income, TRANSTOOLS 61.6 
Increase in labour welfare, TREMOVE 83.7 
Increase in utility of households, TREMOVE 55.4 
Decrease in production costs, TREMOVE 35.8 
Decrease in cost of pub lic funds, TREMOVE 3.5 
 
Using the results of TRANSTOOLS on the impacts on transport demand allows the 
estimation of welfare gains based on figure 4. The demand curve for air transport can be considered as linear for the part affected by the change introduced by the policy measure (and 
in fact is considered as linear by all models).  Consumer surplus woul d correspond to the area 
of the trapezoid P
0E0E1P1 and would in practice represent a transfer of welfare from security 
providers to travellers plus an increase in th e welfare of travellers due to increased mobility. 
Airlines would benefit from the increased tran sport demand and increase  their income by the 
equivalent to the area of rectangle formed by T 0, T1 and E 1. 
Figure 4: Estimation of welfare gains in TRANSTOOLS 
 E0 
E1 Price 
Trips P0 
P1 
T0 T1 Demand 
curve
 
EN 65   EN TREMOVE is based on the same principles for the calculation of welf are gains (figure 5). 
The total utility or willingness to pay given the equilibrium is gi ven by the area under the 
demand curve limited by 0xSA. The total cost to society is given by th e area under the supply 
curve. This is the area limited by 0xSB. The sh aded area BSA indicates the gain in social 
welfare. The gain in social welfare can be attr ibuted to consumers, the consumer surplus and 
the producer surplus. The price is determined as the crossing between the supply and demand 
curves. A majority of consumers is nevertheless willing to pay more than the actual price on the market as can be seen on the demand curve. Thanks to this phenomenon, consumers (and society) get a utility, they have not to pay for,  the producer surplus (PS). The story is similar 
for the producers. A majority of suppliers supp ly goods at a cost lower than the price. This 
procures suppliers (and society) an extra pr ofit, the producer surplus (PS). The sum of 
producer and consumer surplus is the social welfare for this simple case. 
Figure 5: Estimation of welfare gains in TREMOVE 
 A 
B 
 
EN 66   EN  
3.3. Environmental impacts 
The direct impact of the measure simulated is an  expected increase in air transport activity. As 
a result, the level of emissions from air transport is expected to increase proportionally, without however reaching important volumes in  either absolute or relative terms. 
The expected increase in air transport activ ity as simulated by TRANSTOOLS was combined 
with the emission factors of TREMOVE. Table 7 summarises the expected increase per 
emission type and fuel consumption. The external  cost of these environmental impacts would 
be negligible though, totalling less than 1 million euro per year. 
Table 7: Environmental impacts  
 Difference  
CH4 emissions (tons) 16.3 
CO emissions (tons) 7.2 
CO2 emissions (tons) 4005.0 
Fuel consumption (toe) 793.4 
NMVOC emissions (tons) 11.0 
NOx emissions (tons) 18.1 
PM emissions (tons) 2.8 
SO2 emissions (tons) 39.0 
VOC emissions (tons) 27.3 
TOFP30 emissions (tons) 34.1 
 
                                                 
30 Tropospheric Ozone Formation Potential 
 
EN 67   EN 4. Conclusions 
The simulation of the measures to increase the transparency of airport security financing 
assumed a very limited decrease in ticket prices equivalent to  0.1% of the average price. The 
three models used in this assessment estimate th at for that order of ma gnitude of change in 
prices, an increase in air transport demand of a similar magnitude can be expected. 
Under the hypothesis that such small changes in  costs do affect user behaviour as theory 
suggest, the results imply that air transport demand would margin ally increase as a result of 
the measure, by 0.1% in terms of trips and 0.07% in terms of transport activity. The increase 
in demand would affect mainly shorter dist ances (500-1000 km) and non-business trips. The 
distribution of effects is e xpected to be quite unifor m among EU-27 member states. 
For such a level of increase in demand, airlin e income is expected to increase by €60 million 
per year. Regardless of the level of change in  air transport activity, the reduction of airport 
security costs would lead to sa vings by travellers in the orde r of €80 million per year. As a 
result, household utility w ould increase and producti on costs would decrease.  
The environmental impacts of the expected limited increase in air transport activity can be 
considered negligible in terms of bot h external impact and external cost. 
As a whole, the policy measure simulated is e xpected to have a positive impact on the EU 
economy as a whole, mainly by removing dist ortions that may affect competition between 
modes, airports and airlines. 
 
EN 68   EN Annex 1: TRANSTOOLS model short description 
The Trans-Tools Model is a network-based trans port model of Europe started from the ideas 
consolidated in the modelling experience of the consortium partners. This means that some of the features of the currently av ailable EU models are added, c onsidering that the selection of 
the features of the model address the esse ntial policy needs by the Commission services. 
While ASTRA and VACLAV transport models are used as basis for th e development of the 
passenger demand model, freight modelling is based on the NEAC model for trade and mode 
choice and SLAM for logistics. 
All model components are integrated into ArcGIS  which allow the user to edit, operate and 
illustrate results from the same common GIS-ba sed platform. The innovations obtained from 
the Trans-Tools Model are, 
New set up of a demand/supply model th at is IPR free for the Commission. 
Intermodality for passenger/freight as this is part of the national an d European transport 
policy to promote intermodality  through different measures. 
Full coverage of Central and Eastern Europe (accession countries and the countries at the 
borders of the enlarged Union). 
Integration of New Member States  at a similar level as the EU15. 
Feedback infrastructure development-economy. Logistics/freight chain explicitly included.  Coupling with local traffic in order to address the effect of road congestion. 
A software approach which results in a m odelling tool on network level and GIS based 
interfacing. 
Model structure 
The Trans-Tools Model is similar to a tradit ional four step model including freight and 
passenger modelling. The main sub-models are: 
Freight demand model Passenger demand model Assignment model In addition to these main elements of the m odel system, the Trans-Tools Model also includes 
an economic model based on CGEurope and imp act models. The different models are linked 
applying a number of conversio n routines. The principle of the model in overview is 
illustrated in Figure 1. The model framework a llows feedbacks between the sub-models to 
achieve equilibrium between supply and demand. 
 
EN 69   EN Economic model
Freigt Model Passenger Model
Trade Generation
Mode Choice Distribution
Logistics Mode Choice
Conversions
Conversions Assignment Conversions
Impact Models
 
Figure 1: The principles of the Trans-Tools Model in overview 
Freight demand models 
A generation and attraction patter n of the trade flows in the c hosen basis year  is a starting 
point for building a trade model in general. Spec ifically for the Trans-Tools trade model, the 
ETIS O/D freight transport matrix will be used as  an analog substituting the trade relations 
matrix. The ETIS matrix describes the genera tion and attraction of physical flows of goods 
between the trading countries and geo-clus ters given the economical and institutional 
determinants of the year 2000. For the relati ons with the trading partner from beyond the 
established European area the economical mass of  the partner is the decisive factor. The 
output of the Trans-Tools trade model is a fo recast O/D matrix for freight including origin 
region, between transhipments and destination re gion as well as  transport mode at origin, 
between transhipments, and at des tination, commodity group and tonnes. 
The Trans-Tools modal split model for freight tr ansport is based on the modal split model in 
NEAC. In Trans-Tools the modal split model adju sts the stable modal split resulting from the 
trade model. Output of the Trans-Tools modal split model  is a freight matrix, which consists 
of a forecast O/D matrix including forecast moda l split. In the modal split model the market 
shares of the different modes of transport ar e estimated for every O/D relation and commodity 
group. Within the model there are four modes of transport availabl e (road, rail, inland 
waterway, sea). Choice probabilit ies of the available modes per commodity group for every 
O/D relation are determined by using a multinomial logit model. 
The Trans-Tools logistic module is based on SLAM, which is a module appended to the 
SCENES model. This module ma kes it possible to evaluate th e impacts of changes in the 
logistic and transport systems within Europe on the spatial patterns of freight transport flows, 
through changes in the number and location of  warehouses for the distribution of goods. The 
logistic module produces output that  is to be used in the assign ment model as well as in the 
economic model. For the assignment model the logistic module produces unimodal transport 
matrices (Origin, destination, mode, tonnes, ve hicles). The economic model needs generalized 
and monetary costs per origin, destination and commodity type. These costs can be computed 
 
EN 70   EN from the assigning process. The monetary costs (payment to the public budget e.g. toll, fuel 
taxes) can be separated out if i nput on these costs is available. 
Passenger demand model 
The passenger demand model tack les passenger transport modelling at European level, with 
main focus on the (transport) models SCEN ES, VACLAV and ASTRA. The passenger model 
covers the first three steps of the classic fou r-step-approach, which ar e trip generation, trip 
distribution and modal split.  The trip distribution process in ASTRA depends on results of the 
modal split stage. Hence a feedback mechan ism from VACLAV to the trip distribution 
module is prepared to transfer average generalised times to the trip distribution logit function. 
Trip generation as the first stage of the clas sical four-step transport modeling approach is 
implemented in ASTRA. After the generation of trips emanating from European NUTS3 zones these trips are distributed among des tinations. The spatial trip distribution is 
represented by the second stage of the IWW tran sport modeling approach. In this process the 
vector containing generated trips is transferred into an O/D matrix. In the third step the mode 
for the travel is chosen. Hence impedance da ta from the Trans-Tools assignment model as 
well as O/D matrices per trip purpose from the ETI S database are applied. Travel costs, travel 
time and information about the trip itself like fr equencies and number of transfers are used to 
split the trips between the modes. Subsequentl y, for each origin-destination pair the modal 
split model calculates the probability of selecting a modal alternative out of a set of available 
modes. A non-linear logit function is used in order to calculate the choice probability. The 
explanatory variables represen t the transport service level between two zones e.g. in the 
dimensions travel costs and travel time. Out put of Trans-Tools passe nger demand model to 
assignment model are unimodal passenger O/D tran sport matrices at NUTS3 level in number 
of passengers per mode (rail, road, air) and trip purpose as well as unimodal passenger O/D 
transport matrices at NUTS3 level in number of vehicles for road relatio ns per trip purpose. 
The level of service-matrix with generalised co sts per O/D relation represents the output from 
Trans-Tools passenger demand model to the economic model. 
Assignment models 
The network assignment module produces the dire ct output from the Trans-Tools Model. 
However, the models also generate level-of-ser vice data (LOS) as input to passenger, freight, 
and logistic models in a feed back loop (s ee Figure 2). Input from the passenger model are 
unimodal passenger O/D matrices at NUTS 3 leve l in number of passengers and vehicles by 
mode and trip purpose. Input from the freight  and logistic models are unimodal transport 
matrices at NUTS 2 level by mode, commodity, tonnes, and vehicles. In the Trans-Tools 
Model, transport networks are defined at uni modal level. Following assignment models are 
developed within the Trans-Tools Model: 
Road network (passenger and freight) Rail network (passenger and freight) Inland waterway (freight) Air network (passenger). Passengers by rail and air and freight by rail and inland waterw ays are assigned based on an 
average day, since congestion is  not considered and informati on on service data differentiated 
 
EN 71   EN by time and day is not available. LOS in the ro ad assignment is calculated by time period. In 
Trans-Tools, a stochastic assignment proce dure is applied being founded on probit-based 
models. Before assignment trip matrices are co nverted into the NUTS 3 based zonal system of 
1,269 zones within Europe used  in Trans-Tools Model.  
Economic model 
The future developments by NSTR related sector  of the economy of each region of the EU are 
the outcome of the Trans-Tools economic model CGEurope. Sectoral developments, thus the 
effects of each policy scenario, are predicted by the model in m onetary terms. The computed 
relative changes of economy by s ector with respect to the base line scenario are passed on to 
the NEAC model. Policy evaluation measures, in particular real GDP im pacts and equivalent 
variation, by region, year a nd scenario are further outputs  of the Trans-Tools economic 
model. 
Impact models 
The impacts models are used to calculate ener gy consumption, emissions, external costs and 
safety based on output from the assign ment model as illustrated below. 
 
Figure 2: Impact Model within Trans-Tools Model 
Additional information on TRANSTOOLS can be found at:  
http://energy.jrc.ec.europa.eu/transtools/  USER ARCGIS: 
Scenario 
Environmental 
Transport Assignment Model 
Traffic volumes Energy consumption 
Emissions 
Safety impact 
Fatality Exogenous Data (TREMOVE): 
 
EN 72   EN  
Annex 2: POLES model short description 
Model overview 
The IPTS Air Transport Model is an extensi on of the POLES model c overing the aviation 
sector. Its aim is to project the global ener gy use and the corresponding emissions from the 
civil air transport sect or during the period 2000-2050. 
The model is fed with an extensive database built mainly from IATA’s statistics, and 
complemented with other data from NAS A, EUROCONTROL, Airbus and Boeing. The 
information has been structured in a way fully compatible with POLES. To this purpose, the world is divided into 47 regions, according to  the geographical breakdo wn used in POLES. 
These regions are grouped into twelve m acro-regions. The model considers 78 regional 
markets defined as pairs of macro-regions. 
The model is made up of four interconnected modules, as it is shown in Figure 1. Each of 
these parts deals with a specific problem, namely: 
Capacity planning 
Cost calculation Market clearing Energy use and emissions 
Taking into account the different propulsion systems, sizes, a nd uses, the current aircraft 
models have been classified into ten groups of airplanes. In the capacity planning module, 
current fleet volumes and expected changes in  transport supply are used to determine the 
requirements of new aircrafts for each region  in the following simu lation period. Expected 
supplies are obtained by linear re gression from the past transport supplies. By means of a 
vintage model, which considers the past additions  to the fleet and the survival rate of each 
aircraft group, the model establishes the amount of  aircrafts still in serv ice from each vintage. 
The current fleet by region is then calculated from the balance between added, retired and 
remaining aircrafts. 
The cost calculation module takes fuel prices a nd fleet use in each of the regions, with the 
technical characteristics of the aircrafts, in order to determ ine the operating costs of each 
aircraft class. Fleet use is obt ained as a function of fleet volum e, transport supply and average 
load factor. 
The market match module computes the amount of air transport supp lied by each country in 
each market. Transport supply curves by country a nd aircraft in each market are defined as a 
function of aircraft operating costs and transpor t capacity constraints within the market. Air 
transport capacity constraints are determined as  a certain combination of aircraft fleet, use, 
range, and carrying capacity. Tran sport supply curves are added in order to estimate the 
aggregated transport supply curve of each mark et. The intersection betw een transport demand 
and aggregated supply produces th e market equilibrium price. Transport supplies are given by 
the intersection between the market equilibriu m price and the corres ponding transport supply 
curves by country and aircraft. Transport dema nd has been represented using the so-called 
gravity modelling approach. Transport demand in each market depends on GDP and transport 
price. 
 
EN 73   EN Finally, the module devoted to energy use and emi ssions takes fleet use and aircraft technical 
features in order to estimate the energy consum ption in each of the regions. Based on energy 
demand and through the use of emission indexes fo r six gases, this module is also able to 
calculate the corresponding pollutant emissions. 
 
Figure 1: model diagram 
Model database 
Most of the information required by the model has been obtained from IATA (2004). IATA 
currently represents over 270 airlines in 144 countries, comp rising 95% of international 
scheduled air traffic, and 86.6%  of the total world revenue passenger-kilometres flown in 
2002. 
This information has been reorganised in orde r to be able to dis tinguish between passenger 
and freight traffic. All-cargo flights have been subtracted from scheduled services figures, and 
the remaining scheduled services have been aggregated to charter services. Finally, airline figures have been aggregated depending on th eir flag and according to the geographical 
coverage used by POLES. 
IATA provides detailed fleet and utilization da ta for each member airline. Disregarding the 
model variants, there are 135 different aircraft models currently in us e. These models have 
been classified into ten groups of airplanes according to purpose, propulsion and size criteria.  
According to their use, airplanes can be split into passenger (able to carry passengers and 
cargo) or freighters aircrafts (onl y suitable for cargo). With resp ect to propulsion, aircrafts can 
be equipped with engine jets (either supe rsonic or subsonic) or turbo propellers. 
Regarding size or carrying capacity , aircrafts can be grouped into jumbo jets (with more than Expected 
Current and 
Fleet by 
Current Survival 
rates
Fleet use 
Energy 
Pollutant km and h flown Expected 
Effective 
Supplier 
Market Market 
Operating 
Fuel Load Technical Capacity 
Energy use CtMk t t h
GDP 
 
EN 74   EN 400 seats), wide-body jets (two aisle, between 240 and 400 seat s), narrow-body jets (single 
aisle, between 90 and 240 seats), regional jets (below 90 seats), supersonic jets (narrow-body 
like), regional turboprops (between 20 and 90 seats), and small propellers (up to 20 seats). 
Passenger jets are split into five size categories (supersonic,  jumbo, wide body, narrow body, 
and regional jets), while tur boprops are divided into two cl asses (regional and small). 
Freighter jets are divided into three size cat egories (jumbo, wide body and narrow body jets).  
IATA members’ fleet by the end of 2002 wa s made up of 11338 aircraft, of which 10455 
were jets. Airbus (2003) reported a global fleet consisting of 10789 aircraft with at least 100 
seats by the end of 2002. According to Boeing  (2003a), world fleet was comprised of 15600 
airplanes (i.e. 30% higher than  IATA) of which 11800 were jets. 
When possible, most aircraft technical specif ications have been ob tained directly from 
manufacturers. Energy use and emission indexes have been obt ained from publicly available 
sources (Kalidova et al. (1997), and Sutkus et  al. (2001), and (2003)). In some cases, for 
Russian aircrafts and old aircraft models, spec ifications are taken from similar aircrafts. 
Model equations 
The world has been split into a number of regions  with the aim of desc ribing appropriately the 
most significant traffic flows between and within  those regions. To this purpose, the regional 
markets used in the model are defined as all th e possible pairs of macro -regions listed in the 
following table, disregarding the direction of the traffic31. Thus, the model considers 78 
regional markets (combinations of two macr o-regions such as NOANOA or NOAEUR), of 
which 12 are intraregional. 
Table 1: Macro-regions 
Macro-region POLES Countries 
North America (NOA) CAN, USA 
Central America (CEA) MEX, RCAM 
South America (SOA) BRA, RSAM 
Europe (EUR) Europe (first column in Error! Reference source not 
found. ) 
Commonwealth of Independent States 
(CIS) RUS, UKR, and RFSU 
Africa (AFR) NOAN, NOAP, SSAF 
Middle East (MEA) EGY, MEME, GOLF 
China (CHI) CHN 
North East Asia (NEA) COR, JPN 
South East Asia (SEA) RSEA 
Oceania (OCE) RJAN 
South West Asia (SWA) NDE, RSAS,  
The functional form assumed to represent ai r transport demand is based on the gravity 
modelling approach explained by Verleger (1972) . Under this hypothesis, transport demand in 
year t, Dt, is expressed as the product of a series of factors that may influence the demand ( α, 
β…), modified by a set of elasticities ( a, b…), and a constant K representing other 
unaccounted factors: 
                                                 
31 I.e. the market North-America/Eu rope includes all the traffic from  North-America to Europe and vice 
versa. 
 
EN 75   EN (1) ab z
tt t tDKαβ ω=⋅⋅ ⋅ K 
 
In this model air transport demand is assumed to  be driven by the market price and the GDP. 
The corresponding elasticities have been taken from Eurocontrol (2005), historical demand 
time series from Boeing (2003b), and Schafer et al. (2000), and GDP and population figures 
from the POLES database. 
An important variable used in the following secti ons is the share of a given country in each of 
the passenger transport markets. This is defi ned from the country’s share in total global 
demand, which is defined as the ratio of the total national transport supplies  to each market, to 
the market size. 
The initial values of country’s share in total global demand have been obtained combining the 
information provided by IATA (2004) and Sc hafer et al. (2000). The demand of a given 
country in each market is obtained by multiply ing the market size by th e national share in the 
market. These national demands are used later to  compute the average fuel costs within each 
market. The equivalent variables for frei ght traffic are obtaine d in a similar way. 
Total transport capacities available in each country are given by the combination of the 
carrying capacity (the number of s eats per aircraft and the number of tons that can be carried 
in the holds), the average aircraft range (expresse d in km per flight or departure) and the use, 
represented by the number of depart ures carried out in one year. 
The number of departures gives a notion of the ai rport and air traffic ma nagement capacity. It 
is assumed that departures in a given country grow as the demand in the markets where this 
country operates, using the national shares in each market demand, and therefore traffic congestion is not considered in the model. 
Air transport capacities are allocated to the markets accordi ng to the national shares in each 
market demand. 
Transport supply 
National transport supply curves in each of the markets, by aircraft type, are assumed to be 
shaped as the integral of normal distributions . According to this specification, individual 
supply curves indicate the “willingness to offe r” of an economic agent operating in a given 
market. The average of each normal (i.e. the in flection point of the s upply curve) corresponds 
to the average operating expenses (which incl ude the remuneration of all production factors), 
while the standard deviations have been calibra ted to fit the market price data. Each supply 
curve is rescaled by the transport capacity in th e market (the asymptote of the curve). It is 
assumed that only the countries belonging to a given market can  supply to it (thus NOANOA 
market is supplied only by USA and CAN). 
The transport supply curve in a given market is calculated by the aggr egation of individual 
supply curves by country and aircraft. The inte rsection of the market supply curve and the 
market demand determines the market price.  Transport supplies in  the equilibrium are 
calculated by the intersection of the market  price with the individual supply curves. 
National transport supplies are obtained by the aggregation of the supplies by country and 
aircraft in each market. Nati onal supplies are used later to calculate the e xpected supply, 
 
EN 76   EN required for capacity planning. An  analogue calculation is used to compute freight transport 
demand. 
The procedure explained above guarantees th at the demand is satisfied at the minimum 
possible cost and fulfils the re strictions on capacity. In orde r to carry out the procedure 
explained above, the model uses a set of functions contained in an external  library specifically 
programmed to this purpose. Supply curves are determined by using the approximation of the 
cumulative normal distribution defined by Abra mowitz et al. (1970). Market prices are 
calculated following the standard regula falsi  method. 
Figure 1 illustrates the ca lculation procedure explained above in  the case of a market made up 
of four suppliers. The market demand in each  period is prescribed by the demand function. 
The individual supply curves grow from zero up to an asymptotic value that represents the 
maximum capacity that can be provided by the supplier from a given price upwards. The 
cheaper the supplier, the faster the supplier capac ity is saturated. Thus, if there is unsatisfied 
demand after using up all the cap acity of the cheapest supplier (yellow curve), the other 
suppliers (the cheaper first) use up their capa city until the market demand is met. The most 
expensive suppliers only meet a small share of the demand. The aggregated market supply is 
obtained by addition of the individual supply curves. The market price (represented by the 
vertical red line) is obtained by the intersec tion between the market demand and the market 
supply curve. The intersection of this line with each supply curve determines the supplies provided in the equilibrium. 
050100150200250300350
300 320 340 360 380 400 420 440 460 480 500Market priceSupply and demand
Supplier 1 Supplier 2 Supplier 3 Supplier 4 Market supply Market demand
 
Figure 1: transport supply 
Transport costs 
Operating expenses are estimate dbased on IA TA data. Fuel accounts for around 30% of 
direct operating expenses (16% of total operating expenses). 
 
EN 77   EN It is assumed that all aircraft types use a hom ogenous jet fuel. Basic jet fuel price may be 
incremented by a surcharge depending on the carbon content of the jet fuel when a CO 2 
emission tax or an emission allowance market is implemented. Since aircrafts from a given 
country can refuel anywhere, it is necessary to calculate the average jet fuel price in each 
market. To this purpose, the average jet fuel price in a market is calculated by multiplying the price in each country within the market by th e national demand in that market, and the result 
is added by country and divide d into the market demand.  
In order to represent properly the technical characteristics of the fleet at any time, as well as 
the fleet ageing and renewal processes, it has been adopted a vintage model. The average 
specific fuel consumption per km of each type of aircraft is calculated as the weighted sum of 
the fuel consumption of the different aircraft vintages. 
The energy-related utilisation co sts of each aircraft class are obtained from the specific fuel 
consumption, the national shares and the average jet fuel price in each market, the carrying 
capacity, and the load factors. The total opera ting expenses are estimated by adding the non 
energy-related variable costs, calibra ted to fit the market price data. 
Energy use and emissions 
The pollutants considered in the model are CO
2, H 2O, SO 2, NO X, CO and HC. Pollutant 
emissions of CO 2, H 2O and SO 2 are proportional to fuel c onsumption, while emissions of 
NO X, CO and HC also depend on flight altitu de and other operation conditions. For these 
substances two different emission indexes are co nsidered, according to the available sources 
(Sutkus et al. (2001), and (2003)), each one co rresponding to a specific altitude band (climb 
and descent phases, which takes place between ground level and 9 km during 10% of the flight time, and cruise phase, between 9 km and 13 km of altitude). The corresponding emissions of each pollutant are obtained by mu ltiplying the emission indexes by the jet fuel 
consumption. Jet fuel consumption is the aggreg ation of the products of each vintage fleet by 
its corresponding fuel consumption and the average use. 
 
EN 78   EN  
Annex 3: TREMOVE model short description 
TREMOVE is a transport and emissions simulation model developed for the European 
Commission. The model has been developed by  the Catholic University of Leuven and 
Transport & Mobility Leuven. JRC/IPTS is th e Commission service responsible for the in-
house application of the model. 
The model estimates the transport demand, the modal split, the vehicle stock turnover, the 
emissions of air pollutants an d the welfare level under differe nt policy scenarios. TREMOVE 
models both passenger and freight  transport in 31 countries, and covers the period 1995-2030.  
TREMOVE model structure 
TREMOVE is a policy assessment model to st udy the effects of different transport and 
environment policies on the emissions of the transport sector. It is an integrated simulation model developed for the strategic analysis of th e costs and effects of a wide range of policy 
instruments and measures applicable to loca l, regional and European  transport markets. 
The TREMOVE model consists of separate coun try models. While the numeric values of the 
model differ from country to country, the mode l code is identical across countries. Each 
country model describes transport flows a nd emissions in thr ee model regions: one 
metropolitan area, an aggregate of all other urban areas and an aggregate of all non-urban areas. Trips in the non-urban ar eas are further separated in short (-500 km) and long (+ 500 
km) distance trips. The model explicitly take s into account that, depending on the area taken 
into consideration, the relevant modes and network types differ. 
The transport demand module represents, for a gi ven year and transport mode, the number of 
passenger-kilometres or ton-kilometres that wi ll be performed in each “model region” of the 
country considered. 
Three freight categories are dis tinguished (bulk, unitized and gene ral cargo) as well as three 
passenger trip purposes (non-work, commuting and business). Also, transport flows are 
allocated to peak and off-peak periods. With  this demand module, the impact of policy 
measures on the transport quantity of all transport modes is calculated. 
Transport modes for passenger trips include sl ow modes, mopeds, motorcycles, cars, vans, 
bus, metro/tram, train and plane.  Freight modes are inland waterw ays, freight trains, light duty 
trucks and heavy duty trucks (d isaggregated to four weight classes). Four road types are 
distinguished. 
TREMOVE models the transport activities with in these areas without  explicit network 
disaggregation. This simplification allows to  calibrate a simple but complete policy 
simulation model starting from an exogenous baseline trans port forecast. The baseline 
transport flows are taken from the SCENES mo del which is a genuine network model. Thus, 
to a certain extent, the TREMOVE demand module  is a reconstruction of  the SCENES model. 
Modelling transport decisions of households and firms 
 
EN 79   EN Private transport and business transport are modelled separately in the transport demand 
module. 
The demand for private transport (non-work an d commuting passenger trips) is the result of 
the decision processes of all households in a country. Private transport demand has been 
determined assuming that, within  the constraints of their av ailable budget, households choose 
their preferred consumption bundle. 
I.e. they choose the combination of goods that  maximizes their utility. The demand for goods 
and services follows then from this maximizing behaviour. 
The decision processes of households are mode lled using nested Cons tant Elasticity of 
Substitution (CES) utility functions . These represent the preference relation of all households 
for the different transport opti ons. Knowing the subst itution elasticities between the different 
transport options, it is possi ble to model the change in consumed quantities in policy 
simulations. As an example, the following two figures present parts of  the nested utility 
function. 
 
EN 80   EN 
 
The demand for business transport (freight transp ort and business passenger trips) is modelled 
as a result of the decision processes within  firms. The business transport demand is 
determined by generalized prices, desired production quantities and substitution possibilities with other production factors. 
It is assumed that, in any given year, the producti on level of all firms in a country is given and 
kept constant. For a given production level, prof it maximization then is equivalent with cost 
minimization. The cost-minimizing substitution processes are represented by a nested CES 
production function. At the highest level, there is the total production, which is a function of 
the components at the lower levels. At the lowest level, the arguments are the inputs in the production process. The latter inputs includ e, amongst others, freight transportation and 
business passenger trips. 
Transport prices 
 
EN 81   EN Transport users react on the genera lized price of transport. Theref ore, the price is represented 
as a sum of detailed price com ponents. The resource cost for tran sport services consists of the 
monetary producer costs of all i nputs necessary for these services (cars, fuels, maintenance, 
etc.). On top of the resource costs, the cons umer usually pays taxes or receives a subsidy. 
These are taken into account  to calculate the market price. Th e distinction between user prices 
and costs is important for the welfare assessm ent module, as it determines the governments 
tax revenue from the transport sector. In the demand module, transport users are assumed to 
make their decision on the basis of user prices. 
Furthermore, time costs are added in the generali zed price. Time costs depend on the ‘value of 
time’ of the considered transport trip mode and the travel speed. For the road modes, speed is 
modelled explicitly and varies with transport demand, time period and road type. The speed 
values are also used in th e calculation of emissions. 
Simulations 
Baseline transport demand is taken from the SCENES model. The TREMOVE demand 
module then enables to assess changes in transport demand unde r various policy scenarios. 
Policy measures will affect the generalised pr ices of transport in the demand module. The 
prices can be affected by technological meas ures and new taxation or  regulation policies. 
Within the demand module, these new prices w ill lead to a change in transport demand. 
Overall transport volumes will alter and su bstitution between modes will occur. As a 
consequence also congestion, travel speed and the time price of transport will be affected. 
Welfare module 
To evaluate policies in TREMOVE, a welfar e assessment module has been constructed. 
Differences in welfare between the baseline and the simulated policy scenarios are calculated. 
Based on the utility functions for the private tr ansport demand, the aggregate utility level of 
households is quantified. The modelling of busin ess decisions leads to an aggregate measure 
for the change in production costs of firms.  Additionally, welfare changes stemming from 
changes in tax revenues are incorporated by us ing the marginal cost of public funds. This 
latter approach accounts for the options of the government to beneficially use additional tax 
revenues from the transportation sector to lower taxes in other sectors. Emissions to air are 
calculated in detail as explaine d in the next section. The extern al costs of these emissions are 
also incorporated in the welfar e evaluation of policy measures. 
Life cycle emissions 
In TREMOVE, a restricted life cycle assessment module is implemented, focusing on the fuel 
cycle only. 
To concentrate on fuel implies that not only operational emissions of vehicles, but also 
emissions due to production and distribution of th e fuel (or electricity) are taken into account. 
I.e. well-to-tank and tank-to- wheel emissions are calculated. 
Detailed documentation on the various modules of TREMOVE can be found at: 
http://www.tremove.org/documentati on/Final_Report_TREMOVE_9July2007c.pdf  
 
EN 82   EN  
Executive summary .................................................................................................................. 2 
Section 1: Procedural issues and c onsultation of interested parties........................................... 4 
1.1 Organisation and timing............................................................................................... 4 1.2 Consultation and expertise ........................................................................................... 4 1.2.1 Consultation with Member States and stakeholders .................................................... 4 1.2.2 Expertise................................................................................................................ ....... 6 
1.2.3 Opinion of the Impact Assessment Board.................................................................... 6 Section 2: Problem definition.................................................................................................. ... 7 
2.1 What is the issue or proble m that may require action? ................................................ 7 
2.1.1 Discriminatory and excessive security charges............................................................ 7 2.2 Drivers of these problems .......................................................................................... 10 2.2.1 Lack of transparent security costs.............................................................................. 10 2.2.2 Security charges are the only airport fees not regulated ............................................ 12 
2.3 Who is affected, in what ways, and to what extent? .................................................. 13 2.4 How would the problem evolve, all things  being equal? Should the EU act?........... 13 
2.5 Treaty base ................................................................................................................ . 14 
Section 3: Objectives.......................................................................................................... ...... 15 
Section 4: Policy options...................................................................................................... .... 15 
4.1 Option 1: No EU action ............................................................................................. 16 4.2 Option 2: Self-regulation ........................................................................................... 16 4.3 Option 3: EU Directive on non-discrimina tion, transparency, co st-relatedness and 
possibility to appeal ................................................................................................... 17 
4.4 Option 4: Full state fundi ng of airport security.......................................................... 17 
Section 5: Analysis of impacts................................................................................................. 18 
5.1 Option 1: No EU action ............................................................................................. 18 5.2 Option 2: Self-regulation ........................................................................................... 19 5.3 Option 3: EU Directive on non-discrimina tion, transparency, co st-relatedness and 
possibility to appeal ................................................................................................... 19 
5.4 Option 4: Full state fundi ng of airport security.......................................................... 22 
Section 6: Comparing the options ............................................................................................ 25 
 
EN 83   EN Section 7: Monitoring and evaluation ...................................................................................... 31