‘GOVERNMENT DECREE No 198/2007

of 30 July 2007

establishing the procedure required under Article 5 of Regulation (EC) No 847/2004 of the European Parliament and of the Council of 29 April 2004 on the negotiation and implementation of air service agreements between Member States and third countries

By virtue of its powers under Section 73(3)(g) of Act XCVII of 1995, the Government hereby orders as follows:

Scope

Section 1

For the purposes of this Decree, “limited air traffic rights” means air traffic rights granted under an existing bilateral agreement between Hungary and third countries according to which such rights may be exploited only by a sole or by a limited number of air carriers or are subject to other restrictions (e.g. frequency, capacity, landing points).

Period of validity of the permit

Section 2

(1) The permit to use limited air traffic rights to operate on certain routes shall be effective for twelve consecutive International Air Transport Association (IATA) scheduling periods from the starting date of the air service as specified by the aviation authority.

(2) The permit and the rights conferred thereby are not transferable.

Negotiations concerning air traffic rights

Section 3

(1) Information concerning the availability of limited air traffic rights between Hungary and non-EU Member States and the negotiations in connection with those rights shall be published by the aviation authority on its own website 45 days prior to the start of such negotiations.

(2) The information thus published shall include the planned tenor and timing of the negotiations.

(3) Community air carriers established on Hungarian territory (hereinafter: Community air carriers) may submit a permit application within 30 days of publication of the information.

(4) Prior to the planned negotiations with the third country, Community air carriers shall notify the aviation authority in writing, by the deadline specified on the website, of their operating intentions in respect of the third country concerned, if they plan to operate a route with limited air traffic rights.

Unused limited air traffic rights

Section 4

(1) The aviation authority shall publish on its website information on any limited air traffic rights between Hungary and non-EU Member States remaining unused.

(2) The aviation authority shall publish on its website notice of receipt of the first application for the exploitation of unused rights within 7 days of its submission. Within 30 days of this information being published, other carriers may apply for the use of the same rights. The aviation authority shall publish notification of all applications received by the deadline on its website.

Procedure

Section 5

(1) Applications to use limited air traffic rights shall include the following: (a) the name, registered office, place of business and three-letter airline identification code of the Community carrier; (b) details of the planned service to be operated by the carrier (number of flights per week, aircraft type, maximum seating capacity, any stopovers and duration of service); (c) the carrier's envisaged business plan; (d) starting date of the planned service; (e) nature of the service: passenger, cargo, post, service specifications; (f) details of how the new service will link in with any existing route network operated by the carrier; (g) route pricing.

(2) The Community air carrier shall append to the application a certificate of payment of the administration fee laid down under separate statutory provision.

Section 6

(1) When examining applications, the aviation authority shall take the information submitted in accordance with Section 5(1) into account in its economic appraisal, which shall include an assessment of the benefits offered to consumers, the impact on intra-Community competition and aspects concerning freight and passenger flows on the given route. The aviation authority shall draw up the criteria for this evaluation and publish them on its website.

(2) The aviation authority shall, if it sees fit, conduct a public hearing in the course of the procedure. It shall publish the proceedings of any such hearing on its website. The applicant airlines shall have three days from publication of the proceedings within which to submit any comments they may have.

(3) The aviation authority shall render its decision concerning authorisation for the route to be operated using the advertised unused rights within 60 days of the hearing referred to in subsection (2) or, in the absence of such, within 60 days of the expiry of the 30-day application deadline stipulated in Section 4(2). The published announcement of the decision shall include the operative part thereof.

(4) Following a comprehensive evaluation, the aviation authority shall award the operating permit to the applicant considered to be the best, with regard in particular to passenger and/or freight service, the promotion of competition and the balanced development of the Community air transport market.

Legal remedy

Section 7

(1) The decision of the aviation authority is not open to administrative appeal.

(2) The aviation authority shall publish the operative part of any decision reached during judicial review on its website within three days of the decision being notified.

Review of permits

Section 8

(1) The aviation authority shall closely monitor air services operated under the permit issued.

(2) At the request of any Community air carrier, the aviation authority shall, at the earliest upon expiry of ten consecutive scheduling periods following its award, review the permit on the basis of the elements enumerated in Section 6(4).

(3) Within seven days of receiving the request for review, the aviation authority shall notify the permit holder and announce the review publicly on its website. Other Community air carriers may submit an application to use the same air traffic rights within 30 days of the announcement being published. In the subsequent review, the provisions of Sections 4-6 shall be applied as appropriate.

(4) The aviation authority shall suspend the permit with immediate effect in the following circumstances: (a) if the holder fails to provide air services in accordance with the terms of the permit; (b) if the holder fails to meet his obligations under the relevant air service agreement or other international obligations on the basis of which the permit was issued; (c) if the holder fails to comply with the regulations applicable to the provision of air services; until such time as these shortcomings are remedied.

(5) The aviation authority shall withdraw the permit if: (a) the holder informs the aviation authority in writing that he no longer wishes to make use of the limited air traffic rights; (b) the authorised air services were not commenced within the scheduling period following the specified starting date; (c) the authorised air services are discontinued, and are not resumed within the next two consecutive scheduling periods; (d) where air service operation has been suspended by the authority for shortcomings in performance, and these are not remedied by the end of the scheduling period following the suspension; (e) the third country does not accept the designated Community air carrier, or the competent authority of the third country does not issue or withdraws permission to operate the route concerned.

(6) The Community air carrier shall notify the aviation authority in writing within eight days of any refusal or withdrawal of permission as referred to in Section 5(e).

(7) The aviation authority shall announce the withdrawal of the permit on its website, specifying the date on which the air traffic rights concerned are considered unused.

Transitional provisions

Section 9

If a route with limited traffic rights between Hungary and a third country was already being operated prior to the entry into force of this Decree in accordance with the legislation effective at the time, a request for reassessment of the rights concerned may be made upon the expiry of ten consecutive IATA scheduling periods following the entry into force of this Decree.

Closing provisions

Section 10

(1) This Decree shall enter into force on 1 September 2007.