EN Official Journal of the European Union C 70/14

Portuguese national procedure for allocating limited air traffic rights

2013/C 70/07

In accordance with Article 6 of Regulation (EC) No 847/2004 on the negotiation and implementation of air service agreements between Member States and third countries, the European Commission publishes the following national procedure for the distribution of traffic rights among eligible European Union air carriers where they are limited under air service agreements with third countries.

MINISTRY OF ECONOMIC AFFAIRS AND EMPLOYMENT

Decree-Law No 116/2012 of 29 May 2012

Air travel satisfies needs and performs functions the importance of which in the political and geographical context of our country justifies the State’s commitment to drawing up institutional measures which will enable it to take the most appropriate steps to strike a fair balance between the many interests, both public and private, connected with air transport activities in general.

However, matters relating to air transport, in particular the aspect of access to the market, are at present still regulated, in the area of non-Community air transport, by Decree-Law No 66/92 of 23 April 1992.

All aspects of the aforementioned national legislation underwent significant change after the European Union introduced rules in the area of intra-Community air transport governing access to the Community market in air transport by publishing three legislative packages, the latest of which is called the ‘third package for the liberalisation of air transport within the Community’ and more recently by the publication of 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.

The latter Community Regulation, in addition to making changes to the system, consolidates in a single legal instrument the previous systems which were contained in Council Regulation (EEC) No 2407/92 on licensing of air carriers, Council Regulation (EEC) No 2408/92 on access for Community air carriers to intra-Community air routes and Council Regulation (EEC) No 2409/92, all of 23 July 1992.

As a result of not having undergone any changes until now, non-Community air transport is still regulated by the national provisions in the abovementioned Decree-Law, notwithstanding the rules laid down respectively in bilateral air services agreements and other related bilateral and multilateral legal and administrative instruments concluded between States in the field of international relations between Member States and third countries and also those concluded between the European Union, the Member States and third countries.

Thus, following the judgments of the Court of Justice in Cases C-466/98, C-467/98, C-468/98, C-469/98, C-471/98, C-472/98, C-475/98 and C-476/98, it is clear that the Community has competence with respect to various aspects which must be present in bilateral air services agreements concluded between Member States and third countries.

Regulation (EC) No 847/2004 of the European Parliament and of the Council of 29 April 2004 on the negotiation and implementation of air services agreements between Member States and third countries was subsequently published to that effect.

Thus, where it is apparent that the subject-matter of an agreement falls partly within the competence of the Community and partly within that of its Member States, it is essential to ensure close cooperation between the Member States and the Community institutions, as required by the above Regulation.

The Regulation further provides that Member States should establish non-discriminatory and transparent procedures for the distribution of traffic rights between Community air carriers, while safeguarding the need, in the application of those procedures, to preserve continuity of air services.

It is thus clear that the national rules under Decree-Law No 66/92 of 23 April 1992 are totally out of kilter with the new requirements with regard to the distribution of traffic rights in the context of non-Community air transport since it predates the more recent rules governing the negotiation and implementation of air services agreements between Member States and third countries laid down by the European Union. In the case of some of its provisions, it is even contrary to Community law, which means that it needs to be harmonised and brought into conformity with the entire framework of Community legislation in force.

The main purpose of this Decree-Law is therefore to establish a national legal framework which embodies the new Community framework with regard to the distribution of traffic rights and builds on it from the point of view of the national interest in a way which is consistent with the principles of Community law.

Since the market in non-Community air transport must be the subject of rules of law which are consistent and interdependent, so as to constitute a single regulatory system, this Decree-Law aims to create a system which clarifies and lays down the conditions and procedures with regard to the distribution of traffic rights in the context of non-Community scheduled air transport activities.

It provides that the pursuit of non-Community scheduled air transport activities is subject to having an operating authorisation issued by the National Civil Aviation Institute (INAC), I.P.

In terms of access to the market, the principle of non-discriminatory treatment applies, whereby all Community air carriers are permitted access to the routes available in the air services agreements concluded by Portugal.

Thus, in accordance with Article 5 of Regulation (EC) No 847/2004 of 29 April 2004, this Decree-Law establishes a non-discriminatory and transparent procedure for the distribution of traffic rights in situations where an air services agreement, or any amendments to it, provides for a quantitative limitation on the use of the traffic rights available or on the number of air carriers eligible to benefit from those traffic rights.

It also expressly provides that air carriers may, where so permitted by the air services agreement and in accordance with its provisions, conclude private commercial agreements with each other, such as the combination of air services and the conclusion of code-sharing agreements, for the purposes of operating scheduled routes under a single operating authorisation held jointly between them, as provided for in Article 15(5) of Regulation (EC) No 1008/2008 of the European Parliament and of the Council of 24 September 2008.

Finally, it establishes a scheme of penalties relating to the procedure for authorising non-Community scheduled air services, characterising infringements according to the particular extent required by the interests to be protected.

The associations representing the sector and the governmental bodies of the autonomous regions have been consulted.

Thus:

In accordance with Article 198(1)(a) of the Portuguese Constitution, the Government hereby decrees as follows:

CHAPTER I

GENERAL PROVISIONS

Article 1

Subject matter and scope

1. This Decree-Law establishes the legal framework for access to the market and for operating traffic rights in non-Community scheduled air transport.

2. This Decree-Law applies to Community air carriers who intend to operate scheduled air services on routes where Portugal is the origin or the destination.

3. This Decree-Law does not apply to the operation of air services on intra-Community routes as provided for in Regulation (EC) No 1008/2008 of the European Parliament and of the Council of 24 September 2008.

Article 2

Definitions and abbreviations

For the purposes of this Decree-Law, the definitions laid down in Regulation (EC) No 1008/2008 of the European Parliament and of the Council are hereby adopted, in addition to the following:

(a) ‘operating authorisation for scheduled air services’ means a right granted to an air carrier to operate non-Community scheduled air services;

(b) ‘designation’ means the act by which Portugal notifies the other State party to the air services agreement of the undertaking or undertakings to which the traffic rights available in the agreement have been awarded;

(c) ‘traffic right’ means the right to operate air services between two airports. A number of airports (system of airports) which serve the same locality are considered to be a single airport, as laid down in the air services agreement. A traffic right is expressed as a geographical or physical specification, or combination of specifications, identifying the number of air carriers to be designated, and the capacity and purpose of the transport to be carried out;

(d) ‘IATA’ means the International Air Transport Association;

(e) ‘INAC, I.P’ means the Instituto Nacional de Aviação Civil (National Civil Aviation Institute);

(f) ‘IATA winter season’ means the period between the last Sunday of October and the last Saturday of March;

(g) ‘IATA summer season’ means the period between the last Sunday of March and the last Saturday of October;

(h) ‘operating air carrier’ means an air carrier that performs or intends to perform a flight under a contract with a passenger or on behalf of another legal or natural person having a contract with that passenger;

(i) ‘scheduled air service’ means a series of flights possessing all the following characteristics: (i) on each flight, seats and/or capacity to transport cargo and/or mail are available for individual purchase by the public (either directly from the air carrier or from its authorised agents); (ii) it is operated so as to serve traffic between the same two or more airports, either according to a published timetable, or with flights so regular or frequent that they constitute a recognisably systematic series;

(j) ‘non-Community scheduled air service’ means a scheduled air service provided between points situated in Portugal and points situated in the territory of another country or countries.

CHAPTER II

OPERATING AUTHORISATION FOR NON-COMMUNITY SCHEDULED AIR SERVICES

SECTION I

Procedures

Article 3

Operating authorisation

1. The operation of non-Community scheduled air services is subject to having an authorisation issued by INAC, I.P.

2. Operating authorisations granted under this Decree-Law shall be non-transferable.

Article 4

Reporting obligation

INAC, I.P. must publish and keep up-to-date on its website the following information relating to traffic rights which are available for operation:

(a) the programme of bilateral negotiations on air services which are planned with third countries;

(b) the inventory of traffic rights which are available for operation;

(c) the requests for operating authorisations submitted under the terms of this Decree-Law;

(d) the list of authorisations granted under the terms of this Decree-Law;

(e) any decisions of INAC, I.P. changing or withdrawing the authorisations under the terms of this Decree-Law;

(f) the decisions of appeals referred to the court as provided for in Article 13 of this Decree-Law.

Article 5

Application

1. Community air carriers who intend to operate one or more of the traffic rights published under the terms of the previous Article must submit an application to this effect to INAC, I.P, in Portuguese, containing the following:

(a) identification of the applicant;

(b) details of the scheduled air services which it intends to operate;

(c) details of the nature of the traffic to be transported by the applicant;

(d) details of the IATA season or seasons when the applicant wishes to operate;

(e) intended date of commencement of operations.

2. The application must also be supported by the following documents:

(a) valid operating authorisation issued under Council Regulation (EEC) No 2407/92 of 23 July 1992 or Regulation (EC) No 1008/2008 of the European Parliament and of the Council of 24 September 2008;

(b) an air operator's certificate which is valid and appropriate for the operation of the scheduled air services covered by the application;

(c) a document establishing that the applicant’s situation with respect to social security contributions is in conformity with Portuguese law;

(d) a statement establishing that the applicant’s situation with respect to tax is in conformity with Portuguese law.

3. The application shall also be supported by the following:

(a) operating schedule for the air services applied for by the applicant specifying the days of operation, timetables and aircraft to be used, configuration of the passenger cabin, number of seats offered and cargo capacity;

(b) traffic forecasts;

(c) tariff structure to be applied by the applicant;

(d) details of the resources and services, internal or external, to be used by the applicant in providing the service;

(e) details of any leasing contracts concluded or to be concluded by the applicant;

(f) details of any alliances, partnerships or agreements concluded or to be concluded by the applicant for the purpose of performing the services applied for;

(g) details of the conditions under which it will provide the service, as provided for in Article 11;

(h) reservations system;

(l) details about applicant’s previous performance in respect of regularity and punctuality;

(m) details of measures made available in terms of passenger protection.

4. The application must also be accompanied by evidence of compliance with the requirement relating to the economic and financial capacity of the applicant under the terms of Article 9 of this Decree-Law.

5. Where a carrier intends to operate traffic rights granted under different air services agreements, it must submit a separate application for the traffic rights relating to each of the agreements.

6. Supporting material common to the applications mentioned in the previous paragraph may be submitted jointly.

7. The applicant shall be exempt from the requirement to submit the documents referred to in the foregoing paragraphs if INAC, I.P. already holds them in its records, provided that they are up-to-date and legally valid.

8. Applications must be submitted at least 60 working days ahead of the start of the IATA season for which operations are scheduled, except in the case of limited traffic rights where the minimum notice period is 120 working days.

9. Within a maximum of 10 working days from the end of the period mentioned in the previous paragraph, INAC, I.P. shall make a preliminary assessment of the file and if there are compulsory supporting documents that are missing or additional information is needed, it shall notify the applicant that the missing documents or information requested must be provided or the irregularities corrected within 10 working days otherwise the application will be automatically declined on expiry of this time limit.

Article 6

Publicity

After the periods provided for in paragraph 9 of the previous Article, INAC, I.P. shall publicise the application by way of a notice published in the Diário da República, Series II, so that anyone with a legitimate interest may, within 15 working days from the date of publication, comment on the application or submit an application in accordance with the previous Article.

The period referred to in the previous paragraph applies only in the case of publicising applications relating to limited traffic rights provided for in Article 11(1).

SECTION II

Granting an operating authorisation

Article 7

Conditions

An operating authorisation for non-Community scheduled air services shall be granted to an air carrier that cumulatively fulfils the following conditions:

(a) it must hold a valid operating authorisation issued under Council Regulation (EEC) No 2407/92 of 23 July 1992 or Regulation (EC) No 1008/2008 of the European Parliament and of the Council of 24 September 2008;

(b) it must be able to demonstrate that it has the technical, economic and financial capacity appropriate to the air services which it wishes to operate;

(c) it must fulfil the conditions governing designation laid down in the air services agreement(s);

(d) it must hold an insurance contract appropriate to the nature of the air services which it wishes to operate;

(e) its situation with respect to tax and social security contributions must be in conformity with Portuguese law.

Article 8

Technical capacity

1. Technical capacity shall be attested by possession of a valid air operator’s certificate showing, in accordance with the specific legislation applicable, that the air carrier meets the technical standards for operation of the services applied for.

2. The air carrier must have a fleet suitable for operating the services applied for, comprised of aircraft in its ownership or aircraft which are subject to a leasing contract.

Article 9

Economic and financial standing

For the purposes of Article 5(4), the economic and financial capacity of the applicant company shall be determined by evidence that operation of the air services in question is an economically viable activity and does not compromise the financial capacity of the air carrier.

Article 10

Granting of the authorisation

1. INAC, I.P. shall give a decision on each application for an authorisation within a maximum of 20 working days from the date on which full supporting documentation is submitted by the applicant.

2. Whenever INAC, I.P. makes a notification in accordance with the provisions of Article 5(9), the time limit laid down in paragraph 1 of this Article is suspended until INAC, I.P. receives the missing documents or the correction of the information provided.

3. Where an authorisation is awarded in accordance with the conditions laid down in the previous articles, it shall be published in the Diário da República.

Article 11

Limited traffic rights

1. In the event of competing applications and the limitation of either the traffic rights or the number of Community air carriers permitted to exercise these rights, the various requests shall be decided on within a maximum of 60 days from the date on which full supporting documentation is submitted by all applicants, provided that the applications meet the requirements laid down in Article 7 of this Decree-Law.

2. For the purposes of this decision, INAC, I.P. may ask for additional information and, where appropriate, hold hearings, which shall suspend the time limit laid down in the previous paragraph.

3. In any event, the operating authorisation shall only be issued to the applicant air carrier under the conditions provided for in Article 7 of this Decree-Law, provided that the application meets the conditions laid down in Article 5 of this Decree-Law.

4. Subject to the provisions of the air services agreement in question, competing applications shall be assessed by INAC, I.P. on the basis of the following criteria:

(a) the satisfaction of air transport demand with regard to, amongst other things, mixed or freight-only services, direct or indirect services, service frequencies and days of service;

(b) the tariff policy, particularly ticket prices, provision for reductions and other promotions;

(c) overall journey time, from origin to destination;

(d) maximum time needed to replace an aircraft in the event of an operational irregularity attributable to the carrier;

(e) the quality of the service, particularly with regard to the type and layout of the aircraft and the existence of sales offices open to the public;

(f) contribution to ensuring a satisfactory level of competition;

(g) the intended date for the launch of the service;

(h) the presence of guarantees with regard to the continuity of the service;

(i) the potential for increasing the market share of Community air carriers on the route in question;

(j) adapting timetables and the type of aircraft to airport capacity;

(l) the environmental performance of the aircraft used;

(m) the development of connecting flights for passengers;

(n) the contribution to the promotion of the business location, including tourism;

(o) existence of a Portuguese-language sales service, in the case of the routes between Portugal and countries where Portuguese is an official language;

(p) the existence of a majority of the cabin crew that speaks and understands Portuguese, in the case of the routes between Portugal and countries where Portuguese is an official language.

5. The following criteria may also be taken into account:

(a) the existence of a Portuguese-language sales service;

(b) a majority of the cabin crew able to speak and understand Portuguese;

(c) the air carrier’s situation with regard to payment of aeronautical taxes in Portugal;

(d) in addition, further criteria may be taken into consideration provided applicants are notified of this in good time before a final decision is taken on their applications.

Article 12

Selection procedure

1. Once the assessment procedure provided for in the previous paragraph is finished, INAC, I.P. shall publish a draft decision on its website.

2. Interested parties may submit written comments within 10 working days of the publication of this document.

3. The final decision on the authorisation to operate the air services shall be taken within a maximum of 20 working days from the expiry of the period provided for in the previous paragraph.

Article 13

Appeal

A final decision given pursuant to the selection criteria laid down in the previous Article may be appealed before the administrative court.

Article 14

Designation

1. Following publication of the authorisation, Portugal shall designate the air carrier authorised to operate the route in question to the competent body of the other State party to the air services agreement, whenever this is provided for in the relevant agreement.

2. In the situations provided for in Article 15, the operating air carrier shall be designated.

3. Exercise of the rights conferred by the authorisation shall be subject to acceptance of the designation by the other State party to the air services agreement, where provided for in the agreement. This acceptance shall be immediately notified by INAC, I.P. to the relevant authorisation holder.

SECTION III

Private commercial agreements to operate air services

Article 15

Code-sharing agreement

1. Air carriers may, where so permitted by the air services agreement and in accordance with its provisions, conclude code-sharing agreements for the operation of non-Community scheduled air services.

2. In the circumstances provided for in the previous paragraph, the application shall be made, supported and analysed jointly on the basis of the obligations arising from the code-sharing agreement concluded between the parties.

3. The submission of a joint application, with the requisite adjustments to suit what was agreed between the parties, shall not exempt the operating air carrier from complying with the terms and conditions of the operating authorisation laid down in this Decree-Law.

4. The authorisation granted under the terms of this Article shall give rise to the issue of a single authorisation, and can include code-sharing agreements to be concluded, provided that they are allowed under the air services agreement.

CHAPTER III

CHANGES TO THE AUTHORISATION

Article 16

Validity

1. The authorisation shall remain valid so long as it satisfies the conditions negotiated in the air services agreement and so long as the air carrier fulfils the obligations laid down in this Decree-Law.

2. The validity of the operating authorisation shall always be subject to possession of a valid and effective operating licence and air operator's certificate.

Article 17

Amendment of the authorisation

The operating authorisations can be amended by INAC, I.P. where this is justified by the public interest or requested by the authorisation holder, provided that INAC, I.P. approves the requested amendment and the conditions for distributing the limited traffic rights are not called in question.

Article 18

Withdrawal of authorisation

1. INAC, I.P. must withdraw authorisations which have been granted under this Decree-Law in the following cases:

(a) if the air carrier fails to commence operation of the service within two consecutive scheduling periods;

(b) if the air carrier suspends or interrupts operation of the service on grounds not constituting force majeure and does not restart such services within six months;

(c) if there are other special reasons for doing so.

2. INAC, I.P. can withdraw authorisations which have been granted under this Decree-Law in the following cases:

(a) if the air carrier fails to fulfil the terms and conditions on which the authorisation was awarded and maintained;

(b) if the air carrier provides false data and information on the matters referred to in Article 11 which leads to the incorrect application of the criteria laid down therein;

(c) on grounds of public interest;

(d) failure to pay the charges laid down in Article 27;

(e) if the traffic rights have not been used in an efficient manner by the air carrier or if the carrier in question infringes EU or national competition law.

3. For the purposes of paragraph 1(b) of this Article, force majeure shall be considered to be any unforeseeable or insurmountable event, the effects of which are beyond the will and control of the air carrier and have an adverse impact on the operation of the route, in particular:

(a) natural disasters;

(b) meteorological conditions preventing the flight in question from being operated;

(c) risks to the safety of civil aviation;

(d) unexpected deficiencies in the safety of the flight;

(e) strikes affecting the operation of the air carrier;

(f) acts of terrorism or war, declared or otherwise;

(g) breakdown of law and order, in particular for reasons of political instability.

4. Authorisations may also be withdrawn at the request of the authorisation holder.

Article 19

Supervision

Carriers that are authorised to operate non-Community scheduled air services under the terms of this Decree-Law must provide each year, within the time limits laid down by INAC, I.P., traffic statistics, annual operating accounts and any other material useful to INAC, I.P. for supervision purposes or necessary for the proper implementation of this Decree-Law.

Article 20

Publication

Decisions by INAC, I.P. which amend or withdraw authorisations under this Decree-Law shall be published in the Diário da República, Series II.

CHAPTER IV

CONDITIONS FOR THE EFFECTIVE OPERATION OF AIR SERVICES

Article 21

Schedule and timetable

1. Schedules and timetables relating to the air services authorised shall be subject to prior approval by INAC, I.P. where this is provided for in the air services agreement.

2. Authorisation holders shall adhere to the approved schedules and timetables, which must be advertised to the general public.

Article 22

Amendments

1. Any amendments to the approved schedules, such as a change to the frequency, day or time of the services, a change of aircraft or the cancellation of a flight or the introduction of additional flights, shall be subject to prior authorisation by INAC, I.P. where this is provided for in the air services agreement except where such amendments are made as a result of unforeseeable circumstances or on grounds of force majeure.

2. For the purposes of the previous paragraph, authorisation holders must obtain the necessary approvals from the aeronautical authority of the other State party to the air services agreement where provided for in the agreement.

CHAPTER V

MONITORING AND SYSTEM OF PENALTIES

Article 23

Inspection

1. It shall be the responsibility of INAC, I.P. to monitor compliance with the provisions of this Decree-Law, without prejudice to the dedicated monitoring powers conferred by law on other bodies, which must inform INAC, I.P. of the outcome of their activities.

2. Air transport undertakings must provide INAC, I.P. with all the material required for monitoring purposes within 10 working days from the date of the relevant request.

Article 24

Infringements

1. For the purposes of applying the scheme applicable to infringements of civil aviation rules, approved by Decree-Law No 10/2004 of 9 January 2004, the following shall constitute very serious infringements:

(a) operation of traffic rights by an entity not authorised for that purpose in accordance with this Decree-Law;

(b) operation of traffic rights by an entity which has not be designated for that purpose in accordance with this Decree-Law;

(c) operation of an authorisation by an entity other than the authorisation holder;

(d) making false statements in the course of the authorisation procedure;

(e) operation of traffic rights by an entity authorised for that purpose without the compulsory valid insurance;

(f) failure by the authorised entities to provide INAC, I.P. with annual traffic statistics and annual operating accounts and refusal to supply the material which INAC, I.P. requests for the purposes of monitoring compliance with the provisions of this Decree-Law;

(g) amendments to approved schedules in relation to the frequencies, days or times of services, aircraft changes, flight cancellations or the introduction of additional flights without prior authorisation from INAC, I.P., in accordance with Article 22(1).

2. For the purposes of applying the scheme applicable to infringements of civil aviation rules, approved by Decree-Law No 10/2004 of 9 January 2004, the following shall constitute serious infringements:

(a) the air carrier fails to commence operation of the non-Community scheduled services within the time limit established for that purpose or suspends or interrupts that operation on grounds which do not constitute force majeure, in accordance with Article 18(2);

(b) failure to submit for approval by INAC, I.P. the schedules and timetables relating to the authorised air services, in accordance with Article 21(1);

(c) failure to adhere to the schedules and timetables approved by INAC, I.P., in accordance with Article 21(2);

(d) failure to publish the schedules and timetables approved by INAC, I.P., in accordance with Article 21(2);

(e) failure to pay the charges laid down in Article 27.

3. Negligence and attempts to commit an offence are also punishable.

Article 25

Infringement proceedings

1. It shall be the responsibility of INAC, I.P., in accordance with Decree-Law No 145/2007 of 27 April 2007, to initiate and conduct infringement proceedings and to apply fines and additional penalties.

2. The infringements provided for in this Decree-Law shall be subject to the scheme applicable to infringements of civil aviation rules, approved by Decree-Law No 10/2004 of 9 January 2004.

Article 26

Additional penalties

1. In accordance with Section II, Chapter II, of Decree-Law No 10/2004 of 9 January 2004, and Article 21 of the General Rules on Infringements, approved by Decree-Law No 433/82 of 27 October 1982, as amended by Decree-Law No 356/89 of 17 October 1989, by Decree-Law No 244/95 of 14 September 1995, by Decree-Law No 323/2001 of 17 December 2001 and by Law No 109/2001 of 24 December 2001, INAC, I.P. may decide to apply the additional penalty of prohibition from pursuing air transport activities for up to two years in accordance with Article 14 of Decree-Law No 10/2004 of 9 January 2004, in addition to the fine for infringement laid down in Article 24(1)(a), (b), (c) and (d).

2. Penalties for infringements may be published in accordance with Article 13 of Decree-Law No 10/2004 of 9 January 2004.

CHAPTER VI

FINAL AND TRANSITIONAL PROVISIONS

Article 27

Charges

1. An initial charge is payable for submitting the application for an operating authorisation and also for granting the authorisation, which will be increased by 50 % in the circumstances provided for in Articles 11 and 12 of this Decree-Law.

2. Holders of operating authorisations provided for in this Decree-Law must also pay an annual charge calculated on the basis of the costs involved in supervising the implementation of the legal framework established in this Decree-Law.

3. The charges provided for in this Article shall be decided by order of the Minister responsible for the civil aviation sector.

4. Pending publication of the order referred to in the previous paragraph, all legislative provisions relating to the charges laid down in this Article shall remain in force.

Article 28

Repeal

Without prejudice to Article 27(4), Decree-Law No 66/92 of 23 April 1992 is repealed.

Article 29

Entry into force

This Decree-Law shall enter into force on the day after its publication.