Proposal for a Council Directive on airport charges
Date: 1997-04-23
Institutions: European Commission
Subjects: air transport, airport, charges for use of infrastructure, liberalisation of the market, provision of services

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 23.04.1997 
COM(97) 154  final 

97/0127 (SYN) 

Proposal for a 
COUNCIL DIRECTIVE 

on airport charges 

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

I. 

Introduction 

1.  The adoption of the third civil aviation package1 by the Council in July  1992 represents 
the final stage  in  the  liberalization  of  the  aviation  sector  within  the framework of  the 
completion  of the Internal Market.  The new market  organization  makes it essential that 
ancillary  aspects  of  air  transport,  such  as  groundhandling  services,  computerized 
reservation systems, air traffic  management and slot allocation, meet the requirements of 
the  Single Market.  This is also the case with airport  charging  systems.  This  process  of 
liberalization emphasizes the need for a rational management of airports which associate 
more  and  more  their  mission  of  managing  infrastructure  with  an increased  commercial 
approach. In addition, the management and ownership structures of the airport are varied. 
However, among the diverse activities they may exercise, the airports must above all fulfil 
their  mission  of  handling  aircraft  and  their passengers.  The charges they receive  in the 
framework  of this mission, for which they exercise a natural monopoly and are thus not 
submitted to market rules, cannot be established in a purely arbitrary manner. 

2.  An  analysis  of  airport  charges  in  the  Community  shows  that,  even  when  taking  into 
consideration a great diversity of situations as well as investments specific to each airport, 
in numerous airports: 

•  the level  of  airport  charges  is abnormally  high  when  compared  to  the  real  costs  of 

facilities and services provided to the users; 

•  an important  difference  subsists  between  national  and  international  flights,  including 
intra-Community flights. The charges for  a national  flight  may vary from 30 to 90% 
when compared to those paid for a similar intra-Community flight; 

•  the  tarification  systems  often  appear  very  technical  and  complicated  and  the 
information  concerning  calculation  criteria  are not  always provided  and in the  event 
that they are, they often  seem inadequate; 

•  the users are not informed  of future airport investments and their consequences on the 

level of charges; 

•  there is an important difference in the level of aeronautical charges for the same type of 
aircraft,  these  may  vary  from  around  ECU  800  to  over  ECU 2 500  for  an 
intra-Community  flight  on  an  A-320  with  approximately  100  passengers.  These 
variations seem to indicate that airport charges do not  always reflect  the real costs of 
* facilities  and services provided by the airport to the users. They appear too important 
to  be  merely  the  reflection  of  local  economic  conditions  or  the  result  of 
airport investments; 

•  no user consultation procedure is foreseen when the level of charges is established. 

1.  Council  Regulations  (EEC)  Nos  2407/92,  2408/92,  2409/92,  2410/92  and  2411/92  of  23 July 1992 

(OJof24 August 1992). 

3.  For the purpose of the  Single Market  it is essential that  air carriers  operate under fair  and 
equitable  market  conditions.  Consequently,  there  should  be  no  discrimination  between 
equivalent  intra-Community  air services, and the price paid by users  should  be reasonably 
related to the cost  of the facilities used or the services provided. 

At  the  same  time  information  concerning  airport  charging  systems  should  be  made 
available  by  the  airports  to  users  so  as  to  ensure  transparency  regarding  the  different 
aspects of charging. Regular exchanges of information  between  airports  and  users  should 
contribute to this transparency, and appropriate  and adequate consultations should  enable 
airports and users to overcome points of dissension. 

in 

4.  Such  requirements  would  be 

line  with 

laid  down  by 
the International  Civil  Aviation  Organization  (ICAO),  more  particularly  in  Article  15 
of the Convention  on  International  Civil  Aviation  signed  on  7  December  1944  in 
Chicago, as well  as  in  the  Statement  by  the  Council  on  Charges  for  Airports 
and Air Navigation  Services  (ICAO  Doc.  9082)  and  included  in the  "Airport  Economics 
Manual" (ICAO Doc. 9562). 

the  basic  principles 

5.  Finally,  it  is  essential  that  air  transport  should  contribute  to  "sustainable  mobility"  and 

remain environmentally  compatible. 

6.  Airport  charging  systems  should  therefore  provide  airports  with  the  means  to  manage 
airport  capacity  efficiently  and  to  limit  the  impact  of  air  transport  on  the  environment, 
particularly in the vicinity of the airport. 

7.  For  all these  reasons,  the  Directorate-General  for  Transport  issued  a  consultation  paper 
on  airport  charges.  This paper  examined  the  situation  at  airports  in  the  Community  and 
proposed  a  Community  framework  with  three  basic  principles  -  cost-relatedness, 
transparency  and  non-discrimination  - to  ensure  fair  and  equitable  market  conditions  for 
users and airport  owners/operators. 

The  consultation  paper  was  sent  to  the  various  interested  parties:  airports,  carriers, 
authorities 
employees 
in 
the 
international  civil 
the Member  States;  environmental  conservation  associations  and 
aviation organizations. 

and  passengers; 

and  national 

regional 

local, 

National  experts  were  also  able 
(European Civil Aviation Conference) working group on charges. 

to  express 

their  opinion 

in 

the  EC AC 

8.  The majority  of the  parties consulted  replied.  The total  response  rate was in the  order  of 
67%, to  which  must be added  a number  of opinions  expressed  spontaneously  by  national 
air transport  organizations  and by carriers.  On the basis of these  replies, the  Commission 
has been able to gain an overview of the airport  charges problem and to draw a number of 
conclusions regarding future  EU initiatives. 

II.  The current  situation  in the  Community 

(a)  Airport  charges 

9.  Airport  charges  serve  to  cover  the  cost  of  providing  airport  facilities  and  services.  They 

represent  a major  source of revenue for the airport.  K 

Airport  charges,  such  as  passenger  charges  and  landing  charges,  must  be  distinguished 
from  airport or environmental taxes which are imposed by the national authorities and do 
not represent revenue for the airport, but are usually collected by the airport on behalf of 
the Treasury. 

So-called  "charges" levied  as  concession  or  rental  fees  represent  additional  sources  of 
revenue  for  the  airport  which  should  be  identified  as  such  and  be  distinguished  from 
airport charges. 

10.  Airport  charges are usually established  and levied in accordance with a set  of principles 
and criteria  which  make up the  airport  charging  system.  Charging  systems  are  in most 
instances imposed and governed by the national authorities. 

11.  Charging  systems  also  function  as  management  tools.  By  modulating  certain  charges, 
airports can seek to enhance the use of airport infrastructure  as well as seek to reduce the 
impact of air transport on the environment. 

(b)  Charging systems 

12.  Airport  charging  systems in the Community differ  considerably from  one Member  State 
to another and sometimes even within a single Member  State. They nevertheless include 
certain  basic  elements  such  as  a  description  of  the  airport  facilities  and  services 
covered by each type of airport  charge, the cost  basis of the individual  charges  and the 
method of calculation. 

Airport  charging  systems also include the decision-making procedures for  modifying  the 
system or the mechanism for collecting the charges. 

Airport  charging  systems  cover  a  wide  variety  of  charges  related  to  different  airport 
facilities  and  services.  These  include  landing,  lighting,  parking,  refuelling  and  storage 
facilities as well as aircraft,  passenger and freight services. 

As there is no  standard  use for  the different  airport  charges,  they  do  not  always  cover 
identical facilities or services. 

13.  Airport  charges are based on a number of criteria, which vary from  one charging system 

to another. Some criteria, however, are in common use. These include: 

• 

• 

• 

• 

the origin or destination of the flight, with frequent  distinction between domestic and 
international flights for landing, passenger and lighting charges; 

the  mass  of  the  aircraft,  often  the  maximum  take-off  weight,  for  landing  and 
parking charges; 

the noise category of the aircraft  for the noise charge or, if no such charge exists, for 
the landing charge when modulated according to the noise emissions of the aircraft; 

the parking time, sometimes modulated in accordance with the flight  schedule, for the 
parking charge; 

• 

the  number  of  passengers,  their  age  and  sometimes  the  distance  flown  for  the 
passenger charge; 

• 

the freight tonnage loaded or unloaded for the freight charge. 

Some  of  these  criteria  can  give rise to  discrimination,  as  in  the  case  of  the  origin  or 
destination of the  flight. 

14.  Airport charging systems sometimes provide for the possibility of varying certain charges. 
Thus, in some Member States charges are reduced  for certain categories of users or for 
certain users within a particular category, as for example in the case of reduced passenger 
charges for transit passengers or for children. 

15.  Airport charging systems also often include the possibility of exempting certain users  from 

payment of all or several charges. 

Thus, aircraft  which fall within a particular noise category, military aircraft,  aircraft  used 
for the transport of Heads of State, aircraft  on humanitarian missions, aircraft  piloted by 
members of the aviation authorities, aircraft  forced  to return to their point  of departure, 
flights  operated at the request of the authorities, test flights and flights carried out for the 
obtention or renewal of licences or certificates are often exempted. 

Such exemptions may also cover passengers, such as transit passengers, children and crew 
members servicing the aircraft. 

16.  The level of airport  charges varies  significantly  from  one Member  State to  another and 

often even from one airport to another within a single Member State. 

Even when taking account of the exchange rate variations and the wage level  differences 
between Member States as well as additional factors,  such as demand and environmental 
compatibility, it is questionable whether those differences justify  a cost variation for these 
facilities  and  services  of  between  1 and  18  for  international  traffic  and  1  and  9  for 
domestic traffic. 

17.  In the case of landing and passenger charges there are significant  differences  according to 
the  origin  or  destination  of  the  flight.  In  most  cases  charges  for" international  flights, 
including intra-Community flights, are higher than for national  flights. 

(c)  Exchange of information and consultations between airports and users 

18.  Even if in some Member  States the airport  charging  system(s)  provide  for  exchange of 
information between airports and users, very often this information is restricted to certain 
users. Furthermore, it is often not appropriately detailed or sufficiently  transparent. 

The lack of adequate information makes it difficult  for users to check the relation between 
the costs and the level of airport  charges as well as the possible existence of  differential 
treatment. Moreover, the absence of regular exchange of information  between users and 
airports  may make it  difficult  for  airports to  plan  their  future financial requirements in 
accordance with traffic  forecasts. 

19.  Some charging systems provide for  consultation  procedures  between  airports and users. 
These  procedures  vary  throughout  the  Community.  In  some  instances  consultation  of 
users is mandatory prior to  a change in the level of charges, the introduction  of a new 
charge or a modification of the charging system. Often only certain users are consulted. 

This makes it difficult  for users to argue their case when major or unforeseen  increases of 
airport charges, new charges or changes in the charging system are introduced. 

OS.  A Community framework 

(a)  Objectives 

20.  In  1990 the Commission  adopted  a Proposal  for  a Regulation  on  consultation  between 
airports «and  airport  users  and  on  airport  charging  principles2  This  proposal  was  not 
adopted by the Council. 

Since the completion of the Internal Market on I January  1993 and the entry into force of 
the  Treaty  on  European  Union  on  1 November  1993,  this  proposal  no  longer  meets 
existing requirements. 

21.  Furthermore, the liberalization of the aviation sector has gradually highlighted the need to 
ensure  the  rational  operation  of  Community  airports.  Airports  are  increasingly  being 
managed as commercial undertakings and must, therefore,  strive to be efficient  and aim at 
an optimal management  of their infrastructure  and resources.  This can only be achieved 
within a framework which ensures fair  and  equitable treatment  of users, while allowing 
airports, notably through  a system of planification  and regulation  in time of the level of 
charges, to adapt the use of the charging system to the requirements of an optimal airport 
management which remains compatible with environmental constraints. 

The  need  for  such  a framework  was pointed  out  by the  Commission  in its  June  1994 
Communication on the way forward for civil aviation in Europe3. In its Resolution on the 
situation in European civil aviation, the Council confirmed that an optimal management of 
airport infrastructure would help make European aviation more competitive4. 

22.  This framework  must  also  remain  compatible with  the  global  approach  outlined  in the 
Commission White Paper "The Future Development of the Common Transport Policy - A 
global approach to the construction of a Community framework for sustainable mobility"5 
in  order  to  ensure  its  contribution  to  the  efficiency  of  the  transport  system  as well  as 
economic and social cohesion. 

The  efficient  operation  of  airports  as  well  as  fair  and  equal  treatment  of  users  thus 
represent the key objectives of such a  framework. 

2.  COM(90) 100 final of 22 May 1990. 
3  COM(94) 218 final of 1 June 1994. 
4.  Council Resolution of 24 October  1994 (OJ No C 309, 5.11.1994, p. 2). 
5. 

"The future  development of the Common Transport  Policy  - a global  approach  to the construction  of a 
Community framework  for sustainable mobility", COM(92) 494, 2.12.1992. 

6 

(b)  The means 

23.  Not all differences  in the charging systems and airport charges are incompatible with the 
objectives  of  a  Community  framework.  Harmonization  of  existing  regulations  in  the 
Member States would be virtually impossible to achieve and, moreover, is not essential to 
achieve these objectives. This framework must simply lay down general principles setting 
out the basic rules applicable in all Member States. 

However, airport charging systems will have to meet a number of requirements to ensure 
that  charges  are  non-discriminatory,  that they reflect  the  costs of the  airports  and  that 
users are provided with adequate information. 

Such  requirements  will  mean  introducing  the  three  principles:  the  principles  of 
non-discrimination, cost-relatedness and transparency. 

24.  These principles constitute the key elements of the Community framework and should be 
applied in a manner which allows for a certain flexibility  appropriate to the objectives of 
efficient  management of airport capacity,  environmental  compatibility  and economic and 
social cohesion. 

25.  Although  the  principles  of  non-discrimination  and  transparency  can  be  applied  to  all 
Community  airports  and  all types  of traffic,  it  is  much  more  difficult  to  maintain  true 
cost-relatedness at small airports. The efficient  operation of most of these small airports, 
which  play  a  key  role  in  the  Community's  economic  and  social  cohesion,  requires 
considerable  and  regular  State  or  local  authority  support  or,  in certain  cases,  financial 
support  from  larger  airports  in  order  to  avoid  introducing  excessively  heavy  charges. 
Moreover, the number of carriers serving these small airports is very limited and they may 
often  have  daily  contacts  with  the  management  body.  The  introduction  of  Community 
measures does not, therefore, seem justified at the smallest airports. 

(c)  The principles 

The principle of non-discrimination 

26.  The  completion  of  the  Single  Market  makes  it  necessary  to  eliminate  all  forms  of 
discrimination  between  intra-Community  air  services,  since  such  discrimination  is 
incompatible with the principles  of the Internal  Market.  Thus, charging  systems  should 
not  discriminate  between  equivalent  intra-Community  services,  equivalence  being 
understood  in  terms  of  aircraft  type  and  characteristics,  distance  flown  and/or 
administrative and customs formalities. 

27.  Differentiated  treatment between such intra-Community air services would not be justified 
unless  such  a  difference  were  related  to  the  actual  cost  of  the  facilities  and  services 
provided.  In  such  cases  the  airport  authority  would  have  to  provide  evidence  of  a 
significant cost  difference. 

28.  Compliance  with the  principle  of  non-discrimination  should  not  have  any  effect  on the 
global  income from airport  charges.  However,  because  of  the  large  differences  which 
exist  at  present  between  the  charges  for  domestic  and  other  flights  at  most  airports, 
non-discrimination  may lead to  an increased charge burden which.some users, currently 
undertaking a large number of domestic flights, would find difficult  to bear. 

The principle of cost-relatedness 

29.  Because the airport management body is in a monopoly situation as regards the provision 
of airport facilities and services for which charges are levied, it is necessary that charging 
systems set the level of charges in a reasonable  relation to the cost  of the facilities  and 
services which these charges are intended to cover! 

The  principle  of  cost-relatedness  complies  with  existing  Community  law,  in  particular 
Article 86, together with Article 90 of the Treaty concerning abuse of dominant position, 
as  well  as  with  the  provisions  of  the  Chicago  Convention  and  the  recommendations 
of ICAO. 

30.  Cost-relatedness implies that airport charging systems set the level of airport charges in a 
reasonable  relation  to  the  cost  of the  facilities  and  services  provided  by the  airport  or 
airport  system,  allowing  for  a  reasonable  return  on  invested  capital  and  the  proper 
depreciation of assets as well as efficient  management of capacity. 

It  also implies that users should not have to pay for  facilities  which they do not  use or 
services from which they do not benefit. 

31.  However,  a  strict  application  of  the  cost-relatedness  principle  in  terms  only  of  the 
facilities  and  services  actually  used  would  appear  impossible  in  practice,  in  particular 
where  an  airport  has  several  terminals,  perhaps  built  at  different  times  and  subject  to 
different  types  of  use  and  depreciation.  If  the  airport  introduced  a  different  charging 
system  for  each  specific  facility,  this  might  lead  to  changes  in  the  use  of  certain  air 
terminals  and  thus  hamper  the  efficient  and  rational  management  of  the  facilities. 
Furthermore,  if the management  body is unable to  make maximum use  of the  airport's 
existing capacity, this would immediately increase the cost to the users. 

Cost-relatedness  must  therefore  be  seen  globally,  to  ensure  that  the  level  of  airport 
charges covers the total cost of the facilities and services they pay for. 

32.  Similarly,  optimal use of capacity may mean that the management body has to  adopt  a 
global approach to managing all the airports belonging to a particular system or within a 
particular conurbation. The introduction of identical charging systems not only for  all the 
terminals but  also for  all the airports within the conurbation  would  make it  possible to 
avoid  contradictions  in  capacity  management  and  thus  to  avoid  discriminating  against 
certain users who have no choice as to the airport they use. 

Moreover,  certain  Member  States  have  established  a  single  management  system  for 
networks or groups of airports covering all or parts of the country. Inside these networks, 
most  of  the  smaller  airports  are  unable  to  cover  their  costs  unless  aided  by  financial 
support from the state, regional or local levels or,  sometimes, by support from the larger 
airports  in  the  same  network.  The  objective  of  these  types  of  support  systems  are 
generally  to  ensure investments  at  airports  often  situated  in peripheral  areas  as  well  as 
ensuring  a  nation-wide  coverage  of  commercial  air  transport.  The  principle  of 
cost-relatedness does not exclude such a system of solidarity and the proposal  does not 
question its functioning  providing that the subsidies coming from the major  airports are 
drawn from commercial revenue or reasonable benefit margins. 

In  the  cases  where  these  sources  of  revenue  and  the  direct  financial  support  are  not 
sufficient  to  cover  the  needs  of  the  smaller  airports,  the  level  of  charges  at  the  major 
airport  in the  Member  State  may  take  into  consideration  this  situation  on  the  condition 
the 
that  a  substantial  economic 
major  airport. 

link  is  established  between  these  airports  and 

33.  Finally, in order to  avoid  abrupt  increases in the level  of charges where new facilities  are 
made  available,  the gradual  inclusion  of the cost  of infrastructure  and  facilities  yet  to  be 
built or planned but not yet  completed  should  not be excluded.  This would  apply in cases 
where an official  decision has been taken to  build the infrastructure  and building permits, 
where needed, have been issued. 

34.  In  general,  the  liberalization  process  requires  the  larger  airports  to  adapt  to  the  needs 
of the  market  and  particularly  to  diversify  their  revenue.  Those  coming  from  the 
development  of  commercial  activities  could  thus  allow  the  airport  to  lower  the  level  of 
its charges. 

In  the  report  the  Commission  will  submit  on  the  basis  of  the  Article  on  the 
implementation and  possible  revision  of the  proposal,  the  Commission  may  examine  the 
opportunity  to present  supplementary  measures  destined  to  improve  the  management  of 
airport  infrastructure. 

The principle  of transparency 

35.  In order to  ensure that  both the  principles  of non-discrimination  and  cost-relatedness  are 
properly  implemented  and  complied  with,  transparency  requirements  will  be  essential  to 
complete the Community framework. 

they  are 
The  principle  of  transparency  should  enable  users  to  check  whether 
being charged  for  the  facilities  and  services  provided  in  a  non-discriminatory  and 
cost-related  manner. 

The availability of precise, transparent  and comparable information  should enable users  to 
assert  their  rights,  if  necessary,  when  airport  charges  are  significantly  increased  or  the 
charging  system  is modified.  Transparency  should  also contribute to  forward  planning  of 
airport development by linking new investment requirements to charging increases. 

The  principle  of  transparency  therefore  implies  a  regular  exchange  of  precise  and 
transparent information  between airports and users. 

36.  There are two problems affecting  the supply of information.  In the first place, some of the 
information  is of a commercial nature and its disclosure may harm the informer's  interests. 
The  fact  is that  airports  are  increasingly  being  run  as businesses,  subject  to  the  rules  of 
private business  law,  and  the  provision  of certain  information  could  be prejudicial  to  the 
confidentiality  required by good business management. 

Secondly, the more precise the data - and in particular the statistics and distribution  keys -
supplied by the airport management body, the more difficult  they will be to justify. 

37.  It is, nevertheless, necessary  to  introduce minimum requirements  covering the nature an 

the scope of the  information. 

Airports should, for example, provide information on: 

• 

• 

• 

• 

the cost basis for the charges; 

the criteria for establishing the different  types of airport charges; 

the description of the services and facilities covered by each type of charge; 

the accounting data and relevant financial information  as well as the traffic  volume 
of the airport. 

The financial information  and  accounts  should  be  presented  in  accordance  with  the 
accountancy rules generally recognized in each of the Member States. 

38.  Moreover, sound management of airport facilities implies that, as part of the exchange of 
information,  air carriers should provide the airport management body with information on 
traffic  and fleet developments and on the facilities and services they would need to meet 
their forecasts. 

The principle of transparency should be introduced  and applied in such a way as to take 
account of practices and procedures already in use at airports. 

39.  The principle  of transparency  also requires the introduction  of  consultation  procedures 
between airports and airport users. It is within the framework of such consultations that 
the airport management body could inform about not only how much had been charged by 
the airport under each heading during the previous financial year but also its expenditure 
forecasts, the expected growth in traffic  and any planned increases in charge levels. In the 
course of such consultations, the airport users or users'  associations  could  comment on 
these facts  and forecasts.  The  purpose  of the consultation  is to  enable  airports  to  take 
account  of the impact  which new or increased  charges would  have on users.  Although 
the consultation  procedure  should encourage the participants  to  reach  consensus  on the 
issues  concerned,  it  would  be,  on  this  level,  for  the  airport  management  body,  or  the 
statutory national authority, to make the final decision on what new or increased charges 
to introduce. 

40.  Consultation  should  be  compulsory  where  the  charging  system  is to  be  altered  or  the 
charges are to be increased significantly, and it should take place during a specified period 
of time prior to the introduction of the changes. 

41.  Any user who is not satisfied  with the decision taken  should have a guaranteed  right to 
consultation.  This means that  the user  should  be entitled  to  ask to be consulted  by the 
authority which has taken the decision. 

(d)  Modulations 

42.  In  order  to  ensure  that  airports  can  operate  efficiently  and  meet  the  requirements  of 
"sustainable mobility" in the context of the future  development  of the common transport 
policy,  and  in  particular  to  see  that  the  environment  is  protected  in  an  effective  and 
structured manner, it will be essential to ensure efficient  management of airport capacity. 

10 

To  enable  airports  to  meet  these  objectives,  the  principle  of  cost-relatedness  should 
be sufficiently  flexible  to  allow  for  the  modulation  of  some  airport  charges  under 
certain conditions. 

Modulations in function ofdemandandmailable  airport capacity 

43.  A  large  number  of  airports  are  faced  with  capacity  problems  due  to  physical 
and environmental  constraints.  This  situation  is  likely  to  become  more  widespread  as 
air traffic  continues  to  grow.. In  order  to  ensure  their  efficient  operation,  airports 
should be  encouraged  to  make  optimal  use  of  existing  capacity  and  to  plan  future 
capacity development. 

The  possibility  of  modulating  certain  charges,  such  as  landing,  parking  and 
passenger charges, in accordance with the number of movements would  make the price 
of the service  a  function  of  the  level  of  demand.  This  would  enable  the  airport  to 
respond more  efficiently  to  capacity  demand  and  to  manage  more  effectively  scarce 
capacity resources. 

Modulations  could  also  be  used  as  an  incentive  to  reduce  the  number  of  aircraft 
movements by encouraging the operation of larger aircraft during peak periods. 

Modulation in function of the environmental impact 

44.  The cost of handling an aircraft  at an airport consists not only of the cost of the facilities 
and  services  provided  to  the  users  but  also  includes  external  costs  caused  by 
environmental  disturbances,  such  as  noise  and  exhaust  emissions.  At  present  these 
external costs are not always borne by those who cause them. 

This  approach  is  in  line  with  the  strategy  for  "sustainable  mobility"  advocated  in 
the Commission  Green Paper  on the Impact  of Transport  on the Environment6  and the 
White Paper on the Future Development of The Common Transport Policy'' 

rl 

In  its  document  entitled  "Towards  fair  and  efficient  pricing  in  transport"8,  the 
Commission confirmed that, both for reasons of economic efficiency  and equity, measures 
should  be introduced  to  reduce transport  externalities,  i.e.  situations  in which  the user 
does not pay for the full costs of his/her transport activity, including environmental costs. 
The  internalisation  of  such  costs  should  contribute  to  "sustainable  mobility"  since  the 
persons who cause these costs would be made financially responsible for them. 

45.  The  possibility  for  the  management  body  of  modulating  the  level  of  landing  charges 
according to the noise emissions produced by an aircraft  or of introducing  specific noise 
or gaseous emission charges, whether by applying decisions by the public authority which 
controls  it  or  on  its  own  initiative,  may  ensure  an  improvement  of  the  environmental 
compatibility at airports. 

COM(92) 46 final of February 1992. 
COM(92) 494 final of 2 December 1992. 
COM(95)691final. 

11 

The possibility  of  increasing  the  level  of  landing  charges  at  certain  times  of  day  or  of 
introducing a specific noise charge for night flights could serve as a deterrent  and reduce 
the overall impact of noise emissions in the vicinity of the airport. This practice is already 
in force at a large number of Community airports. 

A noise classification  of aircraft  types in accordance with the criteria set out in Annex 16 
to  the  Chicago  Convention  could  make the  introduction  of  such modulations  easier in 
practice and contribute to the overall transparency of charging systems. 

However,  such  modulations  should  remain  in  line  with  the  provisions  of  existing 
Community  legislation,  in  particular  Council  Directive  92/14/EEC  on  the  operation  of 
noisy aircraft. 

Requirements for modulations 

46.  The  possibility  of  modulating  airport  charges  should  meet  certain  requirements,  in 
particular  the  principle  of  non-discrimination.  Modulations  should  not  give  rise  to 
distortions of competition between users and should not be used to increase revenue. 

Since modulations represent a change in the charging system, they should comply with the 
principle of transparency. 

Discounts and exemptions 

47.  A number  of  Community  airports  grant  discounts  or  exemptions to  certain  users.  Such 
practices may be regarded as a form of charge modulation. However, they can result in a 
differentiated  treatment of users which is not justified by a cost difference. 

Discounts  or  exemptions  which  are  not  justified  by  cost  differences  can  give  rise  to 
distortions  of  competition.  They  can  have  discriminatory  effects,  particularly  if 
they favour  the  national  carrier  to  the detriment  of  its  competitors  established  in  other 
Member States. 

Since in  many  instances  airports  are  still  directly  or  indirectly  controlled  by the  public 
authorities, such practices could constitute indirect  State subsidies which are contrary to 
Community law when they affect  or threaten to affect  competition. 

These discriminatory aspects are exacerbated  by the fact  that  discount  systems are often 
applied in a progressive manner and/or operated  on the basis of thresholds below which 
no  discount  or  exemption  is  available.  The  advantage  to  the  beneficiaries  of  such 
discounts or exemptions can be considerable and consequently affect  competition. 

It is therefore essential that discount and exemption systems should meet the requirements 
of non-discrimination and transparency. 

Public service obligations 

48.  Some  airports  are  located  in  less  developed,  isolated  or  landlocked  regions,  where  air 

transport often represents the only rapid link with the rest of the Community. 

12 

Air  links  are  vital  in  overcoming  the  remoteness  of  the  region  as  well  as  for  their 
economic  development.  In  such  cases  the  Member  State  may,  in  accordance  with 
Community legislation, impose a public service obligation on a carrier and grant  financial 
compensation as provided in Council Regulation (EEC) No 2408/92 on market access, in 
order to safeguard the operation of these services and thus contribute to the Community's 
social and economic development. 

49.  The amount  paid  in  airport  charges  is normally  included  in the  financial  compensation 
paid to the carrier responsible for carrying out a public service obligation. In such a case, 
a discount or exemption of the charges based on this obligation would distort competition 
between carriers. Were this not the case, any discounts or exemptions granted would have 
to comply with the rules of fair competition between users and be granted in a transparent 
way so as not to affect  the objectives of the Community  framework. 

IV.  Conclusions 

50.  The introduction of a Community framework for airport charges forms an integral part of 
the liberalization of civil aviation. The appropriate legal base for  a legislative initiative in 
this area of air transport policy is therefore Article 84(2) of the Treaty. 

51.  In view of the inherent differences  between the systems in existence in the Member States 
it is essential to take full account of the principle of subsidiarity and allow Member States 
to implement the contents of the Community framework.  Member States will thus be able 
to determine the type and nature as well as the level of the charges, provided they comply 
with the basic principles of the Community framework. 

52.  The  possibility  of  varying  the  charges  in  line  with  demand,  available  capacity  and 
environmental  impact will enable Member  States to adapt the Community framework  to 
existing  constraints  and  specific  requirements.  A Council  Directive  would  be  the  most 
appropriate legal instrument for that purpose. 

53.  By a flexible system, adapted to the circumstances of each Member State whilst avoiding 
further  bureaucracy,  the  Community  framework  will  give  air  transport  in  general  a 
considerable  added  value  by  introducing  and  reaffirming  fair  and  equitable  market 
conditions not only for carriers but also for airport owners and operators. 

13 

Content of the Directive 

Article 1 

This Article lays down the scope of the measures, which apply to all Community airports  open 
to  commercial  traffic  where  the  annual  volume  of  traffic  is  at  least  250 000  passenger 
movements or 25 000 tonnes of freight. 

Article 2 

This Article gives the definitions required for the application of the Directive. 

Article 3 

This  Article  sets  out  the  principle  of  non-discrimination  for  all  intra-Community  air  services 
which  are equivalent  in terms  of the type or  characteristics  of the aircraft,  the  distance  flown 
and/or the administrative and customs formalities. 

Article 4 

This  Article  defines  the  relationship  which  must  exist  between  the  amount  of  charges 
demanded  by an airport  and the  overall  cost  of the  services  and  facilities  which  these  charges 
are intended to cover.  This relationship has been introduced  because of the monopoly  situation 
of the management body as regards the provision of the facilities and services giving rise to  the 
collection of charges, taking into consideration the objective of economic*and social cohesion. 

Article 5 

This  Article  allows  the  management  body  to  modulate  the  charges  in  function  of  the 
management  needs of the facilities  concerned  or changes in demand, but also in the  framework 
of  protecting  the  environment.  Furthermore,  it  allows  the  management  body  to  finance  these 
facilities and services with all or part of its non-aeronautical revenue. 

Article 6 

This  Article  establishes  the  principle  that  air  carriers  must  be  informed  by  the  airport  on  the 
level  and  details of invoicing  as well  as on the charges  collected  or  anticipated.  This  principle 
supplements and follows  on from the rules on non-discrimination  and cost-relatedness  and will 
help  keep  users  informed  about  the  system  of  calculation  used  by the  management  body  and 
any  investments  it  envisages  to  make.  The  principle  of  transparency  also  applies  to  users  so 
that airports can respond more fully to their needs. 

Article 7 

This Article introduces a system for  the consultation  of airport users. This consultation,  should 
take  place  at  least  once a year,  must  allow users to  express their views  on  plans  for  changing 
the  system  or  the level  of charges.  This is also the framework in which the  management  body 
may provide information  to ensure the transparency referred  to in Article 6. Users must be able 
to  ask  to  be  consulted  by  the  management  body.  Lastly,  the  Article  lays  down  a  minimum 
period between the date of any decision  concerning the system or level of charges and its entry 
into force. 

14 

Article 8 

This  Article  obliges  the  Member  States  to  adopt  the  measures  necessary  to  guarantee  the 
effective implementation of the common rules. 

Article 9 

This  Article  establishes  the  principle  of  cooperation  between  the  Member  States  and  the 
Commission in implementing the Directive. It also lays down that the measures adopted by the 
Member  States in the area covered  by the Directive  must  be notified  to  the  Commission  to 
allow it to verify their compliance with Community law. 

Article 10 

This Article consists of a revision and reporting clause. 

15 

Proposal for a 
COUNCIL DIRECTIVE 

on airport charges 

THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  establishing  the  European  Community,  and  in  particular 
Article 84(2) thereof, 

Having regard to the proposal from the Commission9, 

Having regard to the opinion of the Economic and Social Committee10, 

Having regard to the opinion of the Committee of the Regions11, 

Acting  in  accordance  with  the  procedure  provided  for  in  Article 189c  of  the  Treaty  in 
cooperation with the European Parliament12, 

1.  Whereas the Community has progressively introduced  a common air transport  policy, 
in  particular  for  the  purpose  of  completing  the  single  market,  under  Article 7a  of 
the Treaty; 

2.  Whereas the internal  market  comprises an area without  internal  borders  in which the 

free  movement of people, goods, services and capital is guaranteed; 

3.  Whereas a Community framework  is needed to  ensure that  fair  and  equitable market 
conditions  apply  both  to  users  and  passengers  and  to  the  owners  and  management 
bodies of airports; 

4.  Whereas,  however,  these  rules  must  comply  with  the  principle  of  proportionality  in 
accordance with the third paragraph of Article 3b of the Treaty and should therefore be 
limited to the laying down of fundamental principles; 

5.  Whereas, in addition, the administrative management and the financial situation of the 
smallest airports do not justify the application of the Community  framework; 

6.  Whereas,  within 

this  market, 

there  should  be  no  discrimination  between 

intra-Community flights for the provision of equivalent services; 

7.  Whereas airports may be managed as commercial undertakings which must strive to be 
efficient  in  order  to  make  their  activities  profitable  and  to  better  satisfy  market 
requirements and passengers' needs; 

OJNo 

16 

8.  Whereas, however, within that market, airports are exposed to limited competition; 

9.  Whereas,  among  their  various  activities,  the  main  task  of  airports  is  to  ensure  the 
handling of aircraft  from landing to take-off so as to enable users to carry out their air 
transport business; 

10.  Whereas,  for  this  purpose,  airports  offer  a  certain  number  of  facilities  and  services 
directly  related  to  the  operation  of  aircraft,  the  costs  of  which  they  must  be  able 
to cover; 

11.  Whereas,  unlike  other  types  of  airport  revenue  or  charges  which  may  be  levied  on 
users, airport charges provide compensation for the facilities  and services provided by 
the airport; 

12.  Whereas such services and facilities can, by their nature, only be provided by the airport 
itself; whereas, in view of this monopoly situation, the level of airport charges must be 
in relation to the costs borne for the provision of such facilities and services, taking into 
consideration the objective of economic and social cohesion; 

13.  Whereas an airport  must also be able to  cover  all of the costs required  for  its sound 
operation in terms of efficiency,  safety  and the environment by modulating the level of 
the charges; 

14.  Whereas it is therefore important to ensure the transparency of the costs to which such 
services or facilities give rise; whereas, therefore,  any changes made to the  system or 
level of airport charges must be explained to airport users; 

15.  Whereas,  at  the  same  time,  to  enable  airports  to  fulfil  their  task  of  managing  the 
facilities  and  better  satisfying  users'  requirements,  the  airport's  management  body 
must receive sufficient  information regarding users' forecasts and objectives concerning 
the airport; 

16.  Whereas  such  changes  or  investment  proposed  by  the  airport  must  be  explained  in 
the framework of  consultation  procedures  between  the  management  bodies  and 
airport users; 

17.  Whereas  the  airport's  management  body  must  be  able  to  retain  control  of  the 

management and funding of its facilities; 

18.  Whereas  it  is  necessary  to  take  appropriate  steps  to  ensure  that  infringements  of 
Community law carry penalties which are effective,  proportionate and dissuasive; 

19.  Whereas this Directive should not affect  the application of the provisions of the Treaty, 

and in particular Articles 85 to 94 thereof, 

17 

HAS ADOPTED THIS DIRECTIVE. 

Article 1 

Aim and scope 

The  aim of this Directive  is to  ensure  compliance with the  principles  of  non-discrimination, 
cost-relatedness and transparency as regards airport charges. 

It applies to any airport or airport system located in a territory subject to the provisions of the 
Treaty and open to  commercial traffic.  However,  Articles 4 to  7 apply only to  airports with 
annual traffic  of at least 250 000 passenger movements or 25 000 tonnes of  freight. 

Article 2 

Definitions 

For the purposes of this Directive, the following definitions shall apply: 

1. 

2. 

3. 

4. 

5. 

6. 

"airport" means any land specially developed for the landing, take-off and manoeuvring 
of aircraft,  including any related facilities it may contain for  aircraft  traffic  and service 
requirements and the facilities needed to accommodate commercial air services; 

"management body" means the body which, whether or not  in conjunction  with other 
activities,  has  the  task  under  national  laws  or  regulations  of  administering  and 
managing  the  airport  facilities  and  coordinating  and  controlling  the  activities  of  the 
various operators present at the airport or within the airport system concerned; 

"intra-Community  air  service"  means  any  commercial,  scheduled  or  non-scheduled 
flight  between two Community airports; 

"airport  charges"  means  the  sums  collected  at  an  airport  for  the  benefit  of  the 
management body and paid by the airport's users ensuring the remuneration of facilities 
and services which, by their nature, can only be provided by the airport and which are 
related  to  handling  passengers  and freight, landing,  lighting,  parking  of  aircraft  and, 
where appropriate, the security of passengers as well as the environmental  effects  of 
handling  aircraft  and  passengers,  excluding  any  amounts  paid  for  air  navigation  or 
meteorological services; 

"airport  system" means two or more airports grouped together to serve the same city 
or conurbation, as defined in Article 2(m) of Council Regulation (EEC) No 2408/9213; 

"airport  user"  means  any  natural  or  legal  person  carrying  passengers,  mail  and/or 
freight  by air from or to the airport concerned. 

13  OJNoL240, 24.8.1992, p. 8. 

18 

Article 3 

Non-discrimination 

Member  States  shall  take  the  measures  necessary  to  ensure  that  the  same  level  of 
airport charges  is  applied  at  airports  to  equivalent  intra-Community  air  services  in  terms  of 
the aircraft  type  and/or  characteristics,  the  distance  flown  and/or  the  administrative  and 
customs formalities. 

Article 4 

Cost-relatedness 

1. 

Member  States  shall ensure that the  level  of airport  charges  collected  at  airports  or in 
the airport  systems is set in a reasonable relation to the overall cost  of the services and 
facilities  which  these  charges  intended  to  cover.  When  determining  the  level  of  such 
costs, particular account  shall be taken  of: 

(a)  the cost  of financing the facilities,  including depreciation  in the value of the  assets 
during the period concerned  and the financing of any facilities for which the project 
and  the  date  of  commencement  of  the  works  have  been  duly  agreed  and  any 
administrative permits, where appropriate, have been issued, 

(b)  the financial charges, 

(c)  the expenditure on operation and maintenance, 

(d)  the general administrative charges and various taxes, 

(e)  a reasonable return on the capital invested. 

2. 

Without  prejudice to the application  of the  competition  rules  of the  Treaty,  the  airport 
charges applicable in the major  national airport  of a Member  State can be established  at 
a  level which  permits the management  body,  in order to  promote  economic  and  social 
cohesion,  to  support financially the levels of  airport  charges  in regional  airports  in the 
same Member  State, on condition that: 

(a) 

(b) 

(c) 

this financial support  comes from revenue  other than the  airport  charges  in the 
major  airport  and/or, 

this  support  comes  from  airport  charges,  provided  that  they  are  established  in 
conformity  with paragraph  1, or, 

otherwise, when the conditions referred  to in points (a) and (b) are not  fulfilled 
and  when  the  subsidies  granted  by  public  authorities  are  not  sufficient, 
than 
the regional  airports  concerned  have  an  annual 
300 000 passenger  movements  or  30 000  tonnes  of  freight  and  on  condition 
that  the  annual  traffic  of  transfer  or  transit  passengers  at  the  major  airport 
represent at least  5% of the total traffic  at that  airport. 

traffic  of 

less 

3. 

The  costs  shall  be  determined  using  the  principles  of  accounting  and  evaluation 
generally accepted in each of the Member States. 

19 

Article 5 

Modulations 

1. 

By  derogation  from  Article  4,  the  management  bodies  may  include  the  external 
environmental  costs  due  to  air  traffic  and  modulate  the  charges  to  reflect  the 
requirements in terms of management of the airport facilities or any changes in demand 
and use of the airport during a given period. 

Member  States  shall  ensure  that  the  modulations  are  not  designed  to  generate 
additional revenue for the airport. 

2. 

The management body may also, as part of its commercial policy, 

(a)  take account  of all or part  of its income that  is not  derived from airport  charges 

when establishing the total level of its airport charges, 

(b)  grant discounts in conformity with the provisions of the Treaty. 

3. 

Any modulation in the level of the airport charges shall be applied in a transparent and 
non-discriminatory manner. 

Article 6 

Transparency 

1. 

In order to improve the quality of the service provided to airport users, Member States 
shall ensure that the management bodies provide each airport user with information on 
the components serving as a basis for determining the level of the airport charges. This 
information shall include: 

(a)  a clear list of the various services provided by the airport in return for the airport 

charge levied, and 

(b)  the method of calculation used by the management body. 

2. 

The  management  body  shall  in  particular  provide  airport  users  or  the  associations 
representing them with information concerning: 

(a)  the amount of each category of airport charges collected at the airport, 

(b)  the total  number of staff  deployed to services which give rise to the collection of 

airport charges, 

(c)  forecasts  of the  situation  at the airport  as regards  airport  charges, traffic  growth 

and any proposed investments. 

3. 

Member  States  shall  ensure  that  airport  users  submit 
management body concerning in particular: 

information 

to 

the 

(a)  forecasts as regards traffic, 

(b)  forecasts as to the composition of their  fleet, 

20 

(c)  their development projects at the airport, 

(d)  their requirements at the airport concerned. 

Article 7 

Consultation 

1.  Member  States  shall  take  the  necessary  measures  to  arrange,  at  each  airport,  a 
procedure for consultation between the management body and airport users. The aim is 
to seek the views of airport users before the decision to modify the system or the level 
of airport charges is taken. These views do not bind the authority responsible for taking 
a decision with regard to the airport changes. 

Such consultation shall be held at least once a year. 

2. 

3. 

Member States shall take the necessary steps to ensure that an airport  informs  airport 
users or the organizations representing them of any decision to  change the system or 
level of airport charges at least two months before the change takes effect. 

Member  States shall also ensure that, in the event of disagreement  over the decision, 
airport users are able to request to be consulted a second time. 

Article 8 

Penalties 

Member States shall lay down a system of penalties applicable in the event of infringement  of 
the national provisions transposing this Directive and shall take all necessary  steps to  ensure 
their implementation. The penalties shall be effective, proportionate and dissuasive. 

Member States shall notify  the Commission of those provisions before  1  January 2002 and of 
any subsequent amendment relating thereto as soon as possible. 

Article 9 

Implementation 

1.  Member States shall bring into force the laws, regulations and administrative provisions 
necessary to  conform  with this Directive before  1  January 2002.  They shall  forthwith 
inform the Commission thereof. 

When  Member  States  adopt  these  provisions,  these  shall  contain  a  reference  to  this 
Directive or shall be accompanied by such reference at the time of their official publication. 
The procedure for such reference shall be adopted by Member States. 

2. 

Member  States  shall  communicate  to  the  Commission  the  text  of  the  essential 
provisions of domestic law which they adopt in the field covered by this Directive. The 
Commission shall inform the other Member States thereof. 

21 

Article 10 

Report and revision 

1. 

2. 

The Commission shall submit a report to the European Parliament  and the Council on 
the operation of this Directive before  1  January 2004 as well as, when appropriate, any 
suitable proposal. 

Member States and the Commission shall cooperate in the application of this Directive, 
particularly  as  regards  the  collection  of  information  for  the  report  mentioned  in 
paragraph 1. 

Article 11 

Entry into force 

This Directive shall enter into force on the twentieth day following that of its publication in the 
Official Journal of the European Communities. 

Article 12 

Addressees 

This Directive is addressed to the Member States. 

Done at Brussels, 

For the Council 
The President 

22 

STATEMENT OF IMPACT ON COMPETITIVENESS AND EMPLOYMENT 

Proposal for a Directive on airport charges 

1.  What is the main reason for introducing the measure? 

• 

• 

• 

The need for efficient  management of airport facilities 

To ensure fair and equal market conditions for airports and airlines 

To continue the process of liberalization in the air sector 

2. 

Features of the businesses concerned, in particular: 

• 

• 

• 

• 

Are many SMEs involved? 

No 

Are they concentrated in less-favoured regions? 

No 

Are they eligible for national regional aid? 

Are they eligible for ERDF assistance? 

No 

No 

3.  What direct obligations does this measure impose on businesses? 

Mandatory communication of information to the users as well as the establishment of a 
consultation system for the users 

4.  What indirect obligations are local authorities likely to impose on businesses? 

None 

5. 

Do any special measures apply in respect of SMEs? 

No 

• 

If so, please specify. 

6.  What is the likely effect on: 

• 

• 

business competitiveness? 

An opening up leading to the more effective  operation of airports 

employment? 

No effect  foreseen. 

7. 

Have both sides of industry been consulted? 

Yes 

• 

What are their views? The majority supports the initiative at Community level. 

23 

IMPACT ASSESSMENT FORM 

The impact of the proposal on business 
with special reference to small and medium-sized enterprises (SMEs) 

Title of the proposal: 

Proposal for a Council Directive on airport charges 

Reference number: 

The proposal: 

The impact on business 

1.  Who will be affected  by the proposal? 

Which sectors of business? 

Airports  with  annual  traffic  of  more  than  250  000  passenger  movements  or  25  000 
tonnes of freight  and air carriers. 

Which  sizes  of  business  (what 
medium-sized  firms)? 

is  the  concentration  of  small-  and 

The proposal will not affect  the small airports of the Community. 

In the vast  majority  of cases,  airports  are owned  by the public authorities  (the  State, 
local authorities). Under  the  proposal,  they  provide  certain  facilities  for  take  off  and 
landing and cover the cost of these facilities and services by collecting airport charges. 

The European  air carrier market  essentially consists of big companies, which account 
for  65.4%  of  the  market.  Charter  companies  represent  27.6%,  and  small  and 
medium-sized firms only in the order of 5%. 

Are  there  particular  geographical  areas  of  the  Community  where  these 
businesses are found? 

No 

2.  What will business have to do to comply with the proposal? 

Airports will have to comply with the basic principles of the proposal. Carriers will be 
required to supply information concerning their forecasts of traffic for the airport. 

3.  What economic effects is the proposal likely to have? 

on employment: 

None 

on investment and the creation of new businesses:  None 

on the competitive position of businesses: 

24 

There is relatively  little competition between airports. For much of the traffic,  airports 
enjoy a monopoly as regards the provision of the facilities and services covered by the 
proposal  for  a Directive.  In view  of their monopoly  situation,  airports  must  ensure a 
certain amount of transparency in their costs and in the way the charges are calculated. 
Carriers, who are exposed to keen competition and for whom charges make up a large 
part of their expenses,  must also be consulted before  any unilateral  change is made to 
the level of the charges or the way in which they are calculated. 

4. 

Does the proposal  contain measures to take account of the specific  situation of small 
and medium-sized  firms? 

The smallest airports are not affected by the proposal. 

Consultation 

5. 

List of the organizations which have been consulted and outline of their views. 

A  consultation  document  which  served  as  a basis  for  drafting  the  proposal  has been 
sent to the various parties concerned: the representatives of the Member States, airport 
operators,  air carriers and employees.  The national  experts also had an opportunity to 
express their views at the meetings held in the presence of Commission representatives 
within the European Civil Aviation Conference  (ECAC).  The ECAC  experts  and nine 
of the ten Member  States having expressed their views  as well  as the vast majority  of 
the parties consulted support the principles set out in this document. 

25 

ISSN 0254-1475 

COM(97) 154 final 

DOCUMENTS 

EN 

07 

Catalogue  number  :  CB-CO-97-170-EN-C 

ISBN  92-78-18970-7 

Office  for  Official  Publications of the European  Communities 

L-2985  Luxembourg 

26