1999/199/EC: Commission Decision of 10 February 1999 relating to a proceeding pursuant to Article 90 of the Treaty (Case No IV/35.703 - Portuguese airports) (notified under document number C(1999) 243) (Only the Portuguese text is authentic) (Text with EEA relevance)
Date: 1999-02-10
Institutions: European Commission
Subjects: Portugal, airport, application of EU law, charges for use of infrastructure, reduced price, restriction on competition

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COMMISSION DECISION

of 10 February 1999

relating to a proceeding pursuant to Article 90 of the Treaty

(Case No IV/35.703 — Portuguese airports)

(notified under document number C(1999) 243)

(Only the Portuguese text is authentic)

(Text with EEA relevance)

(1999/199/EC)

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty establishing the European
Community, and in particular Article 86 and Article 90(1)
and (3) thereof,

Having given the Portuguese authorities, Aeroportos e
Navega(cid:135)ao A(cid:130)rea — Empresa Publica (ANA), TAP Air
Portugal and Portugalia the opportunity to make known
their views on the objections raised by the Commission,

Whereas:

(1)

I. THE FACTS

(a) The relevant State measure
This proceeding relates to the system of discounts
on landing charges in use at Portuguese airports
and the differentiation of these charges according
to the origin of the flight.
Article 18 of Decree-law No 102/90 of 21 March
1990 provides that
the amount of aeronautical
charges at airports administered by Aeroportos e
is
Navega(cid:135)ao A(cid:130)rea — Empresa Publica (ANA)

Lisbon airport

First 50 flights (landings per month)

Second 50 flights

Third 50 flights

Fourth 50 flights

Thereafter

Airports at Oporto, Faro and the Azores

First 50 flights

Second 50 flights

Third 50 flights

Fourth 50 flights

Thereafter

Source: Letter from Portuguese authorities, 16 July 1998.

fixed by order in Council, following consultation
with the Directorate-General
for Civil Aviation.
The third paragraph of Article 18 states that the
charges may be differentiated according to the
category, function and degree of utilisation of the
airport in question.

Implementing decree (Decreto regulamentar) No
38/91 of 29 July 1991 lays down the conditions
governing landing charges:
‘Article 4(1): A landing and take-off charge shall be
due for each landing by an aircraft, and shall be
based on the maximum take-off weight stated in
the airworthiness certificate.

Article 4(5): Domestic flights shall be granted a
reduction of 50 %'.

Every year
updating the levels of the charges.

the Government

issues

an order

(2)

The following system of discounts was introduced
by order in Council (Portaria) No 352/98 on 23
June 1998, pursuant to Decree-law No 102/90.

Charges
(PTE/t)

1 146

1 063

979

888

771

1 146

938

866

786

681

Discount relative to
charge for first 50
flights
(%)

–7,2

–14,6

–22,5

–32,7

–18,4

–24,4

–31,4

–40,6

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(b) The relevant undertaking and the relevant

services

(3)

ANA is a public undertaking responsible for
administering Portugal’s three mainland airports
(Lisbon, Faro and Oporto), the four airports in the
Azores (Ponta Delgada, Horta, Santa Maria and
Flores), aerodromes and air traffic control services.
The airports of
the archipelago of Madeira are
administered by ANAM SA.

According to Article 3(1) of Decree-law No 246/79,
which provides the legal basis for the creation of
ANA:

‘ANA-EP shall be responsible for operating and
developing, on a public-sector basis, auxiliary
services for civil aviation, taking the form of an
for directing,
undertaking with responsibility
guiding and controlling air traffic movements, and
providing services associated with the departure
and arrival of aircraft, the boarding, debarkation
and transport of passengers and the loading,
unloading and transport of freight and mail.'

ANA issues authorisations to the airlines which
require access to the airport facilities that it admin-
isters, and provides these airlines with landing and
take-off services for their aircraft,
in return for
which it levies charges, the level and amount of
which are set by order in Council (1).

(c) The landing charges

In its Airport Economics Manual (2),
the Inter-
national Civil Aviation Organisation (ICAO)
recommends that its members base their charges
on the maximum take-off weight (MTOW) of the
aircraft. The landing charge is defined as follows:

‘Charges and fees collected for the use of runways,
taxiways and apron areas,
including associated
lighting, as well as for the provision of approach
and aerodrome control.'

The charge is imposed to cover all ‘operation and
maintenance costs, and administrative costs at-
tributable to those areas and their associated
vehicles and equipment, including the expense of
all labour, maintenance materials, power and fuels'.

(4)

(5)

(6)

(d) The main arguments of the Portuguese

authorities and ANA

(7)

The Portuguese authorities justify the differentia-
tion of charges according to the origin of the flight
on the grounds that:

(1) See recitals 1 and 2.
(2) Document 9562. 1991 ICAO.

— domestic flights serve the island airports, for
which there is no alternative to air transport,

— the other domestic flights involve very short

distances and low fares.

(8)

(9)

Portuguese

The
the
authorities
economic and social cohesion aspects on which the
system is based.

emphasise

flights,

As regards international
the Portuguese
airports are in competition with the airports at
Madrid and Barcelona, which employ the same
type of charging mechanism. The Portuguese
authorities also wish to encourage the economies of
scale deriving from more intense use of
the
airports, and to promote Portugal as a tourist des-
tination.

(10) ANA asserted that

the system of differentiated
discounts on landing charges had been introduced
for two reasons:

— in order to apply a pricing policy similar to
those in operation at the Madrid and Barcelona
airports, which are
same
geographical area
and

situated in the

— in order to reduce operating costs for the most
the airports

frequent and regular users of
administered by ANA.

II. LEGAL ASSESSMENT

(a) Article 90(1)

(11) Article 90(1) of the Treaty states that ‘in the case of
public undertakings and undertakings to which
Member States grant special or exclusive rights,
Member States shall neither enact nor maintain in
force any measure contrary to the rules contained
in this Treaty, in particular to those rules provided
for in Article 6 and Articles 85 to 94'.

(12) Decree-law No 246/79 confers on ANA the
exclusive right to administer the airport facilities at
Lisbon, Oporto, Faro and the Azores.

According to its articles of association, ANA is a
public undertaking within the meaning of Article
90(1) of the Treaty.

(13) Moreover, Article 21 of Decree-law No 246/79
states that the State is responsible for approving the
prices and charges proposed by ANA.

ANA’s current pricing policy is therefore based on
both legislative provisions (Decree-laws Nos 246/79
and 102/90) and regulatory provisions (Decrees

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Nos 38/91 and 24/95) and was established by the
Government by order in Council No 352/98.

position held by ANA can therefore also be felt in
this market.

These legislative and regulatory provisions can
therefore be regarded as State measures within the
meaning of Article 90(1).

(16) Of the seven airports administered by ANA, only
three currently handle a significant volume of
intra-Community traffic (Lisbon, Oporto and Faro).

(b) Article 86

The relevant market

(14)

is the market

The relevant market
in services
linked to access to airport infrastructures for which
a fee is payable, i. e. the operation and maintenance
of the runways, taxiways and aprons and approach
guidance.

As the Court of Justice of the European Commu-
nities has held in the ‘Port of Genoa case' (3), the
organisation of port activities for third parties at a
single port may constitute a relevant market within
the meaning of Article 86. Likewise, the Court
considered piloting services in the Port of Genoa to
constitute the relevant market in its judgment in
‘Corsica Ferries II' (4).

The Court based its reasoning on the fact that, if an
operator wishes to offer a transport service on a
given maritime route, access to port installations
situated at either end of that route is essential to
the provision of the service.

This reasoning can easily be transposed to the air
transport sector and access to airports. The market
definition is the same as that applied in the
Commission Decision 95/364/EC of 28 June 1995
relating to a proceeding pursuant to Article 90(3) of
the Treaty (5) on the system of discounts on landing
charges in operation at Brussels National Airport.

(15) Moreover, the markets for passenger and freight
transport on short and medium-haul air services
within the Community constitute a neighbouring
but distinct market which is affected by the impact
of an abuse on the part of the undertaking in
question on the market for landing and take-off
services. The effect of the abuse of the dominant

(3) Case C-179/90 Porto di Genova v. Siderurgica Gabrielli [1991]

ECR I-5889, p. 5923, paragraph 15.

(4) Case C-18/93 Corsica Ferries Italia v. Corpo dei Piloti del

Porto di Genova [1994] ECR I-1783.

(5) OJ L 216, 12. 9. 1995, p. 8.

(17)

These seven airports are interchangeable only to a
limited extent and each can therefore be regarded
as a distinct geographic market.

or

airlines

domestic

operating

The
intra-
Community scheduled or chartered flights to and
from Portugal are obliged to use the airports
administered by ANA. The airports at Lisbon, Faro,
Oporto and the Azores are not interchangeable,
since they are hundreds of kilometres away from
each other and each has its own, well-defined
catchment area, corresponding to a different tourist
region: Lisbon airport serves the capital and the
centre of the country, Oporto the north, Faro the
south and Santa Maria, Ponta Delgada, Horta and
the
Flores the Azores archipelago. In addition,
existing road and rail links cannot be considered a
viable alternative transport link between Lisbon,
Faro and Oporto.

The only international airports that could serve the
same geographic area, Madrid and Barcelona
airports, being more than 600 km away from the
Portuguese mainland airports and, moreover, not
linked by an adequate road or rail infrastructure, do
not constitute a realistic alternative.

Lisbon and Madrid can, however, be regarded as
competitors where an airline uses one or other of
them as a hub airport. It should be noted, though,
that flights of this type are a negligible proportion
of the total volume of traffic at Lisbon.

Likewise, as regards the airports in the Azores,
Santa Maria, Ponta Delgada, Horta and Flores are,
realistically
interchangeable,
given the fact that each one serves a different island
and that the islands are linked by maritime services
which are relatively slow and infrequent.

speaking,

scarcely

(18)

This being the case, for many passengers to and
from Portugal, the domestic and intra-Community
flights using the airports administered by ANA are
not interchangeable with the flights to and from
other Community airports.

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(19) Airlines running domestic or intra-Community flights to and from Portugal have no
option, therefore, but to use the airports administered by ANA, along with the airport
facility access services provided in these airports.

Effect on trade between Member States

(20)

In its judgment in the Corsica Ferries II case (6), the Court of Justice recognised that
discriminatory practices which ‘affect undertakings providing transport services between
(. . .) may affect trade between Member States'.
two Member States,

The tables below show the volume of intra-Community flights as a proportion of the total
traffic for Portuguese airports:

Passenger traffic (excluding transit passengers)

Airport

International
passengers (%)

Intra-Community
passengers (%)

Domestic passen-
gers (%)

Total (millions)

Lisbon
Oporto
Faro
Santa Maria A
Ponta Delgada A
Horta A
Flores A

24
24
4
2
18
0
0

56
62
92
0
1
0
0

20
14
4
98
81
100
100

6,6
2,1
3,7
0,04
0,5
0,1
0,04

Source: Letter from Portuguese authorities dated 16 July 1998 (1997 figures)
A=airport of the Azores archipelago.

Freight traffic

Airport

International freight
(%)

Intra-Community
freight (%)

Domestic freight
(%)

Total (thousands of
tonnes)

Lisbon
Oporto
Faro
Santa Maria A
Ponta Delgada A
Horta A
Flores A

41
21
5
0
12
0
0

43
72
75
0
0
0
0

16
7
20
100
88
100
100

100
29
2
0,1
6,8
0,9
0,2

Source: Letter from Portuguese authorities dated 16 July 1998 (1997 figures)
A=airport of the Azores archipelago.

The figures above for the mainland airports clearly demonstrate the effect on trade between
Member States. The great majority of traffic volume is between Portugal and other Member States
of the Community.

As regards the four airports on the Azores archipelago, traffic is either entirely domestic or from
third countries. In this respect, therefore, the relevant State measure does not affect trade between
Member States. This is without prejudice to the application of the Treaty rules and secondary
legislation on freedom to provide services.

Substantial part of the common market

(21)

The 1997 traffic volume for ANA-administered airports was as follows:

(6) Cited above, footnote 4.

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Airport

Passengers
(millions)
(including transit
passengers)

Freight
(thousands of
tonnes)

Lisbon
Oporto
Faro
Santa Maria A
Ponta Delgada A
Horta A
Flores A

6,8
2,3
3,8
0,1
0,5
0,1
0,0

99,7
29,3
2,0
0,1
6,9
0,9
0,2

market may be regarded as having a dominant
position within the meaning of Article 86 of the
Treaty' (11).

It follows that ANA, a public undertaking which,
by virtue of the exclusive rights granted to it under
Decree-law No 246/79 in respect of each airport
that it administers, holds a dominant position on
the market for aircraft landing and take-off services,
for which the charge in question is levied.

Source: Letter from Portuguese authorities dated 16 July 1998.
A=airport of the Azones Achipelogo

Abuse of a dominant position

airports which operate

Lisbon, Oporto and Faro airports have a consider-
traffic above the 2
able volume of passenger
million mark (Lisbon 6,8 million, Oporto 2,3
million and Faro 3,8 million) and cover the whole
of mainland Portugal. Taken together, therefore,
intra-Community
the
services can be regarded as a substantial part of the
if one applies the reasoning
common market,
in the Crespelle (7) and
adopted by the Court
Almelo (8) judgments to the case in hand. In the
Crespelle judgment, the Court stated that: ‘by thus
those undertakings, a
establishing,
contiguous
territorially
limited but together covering the entire territory of
a Member State, those national provisions create a
dominant position, within the meaning of Article
86 of
the
common market' (9).

in favour of
series

in a substantial part of

of monopolies

the Treaty,

(22) A fortiori, a contiguous

series of monopolies
controlled by the same undertaking (ANA) may
represent a substantial part of the common market.

Dominant position

(23)

In its judgment Corsica Ferries III (10), the Court
held that
‘an undertaking having a statutory
monopoly in a substantial part of the common

(24)

The system of landing charges and discounts on
charges applied by ANA and approved by the
Portuguese Government after a process of consulta-
tion has the effect of applying dissimilar conditions
to airlines for equivalent
transactions linked to
landing and take-off services, thereby placing them
at a competitive disadvantage.

(a) Discounts based on landing frequency

(or 18,4 % at

(25) Airlines which have more than 50 landings per
month are granted a discount of 7,2 % at Lisbon
the other airports on all
airport
successive landings). After
the 100th monthly
landing, the discount increases to 14,6 % at Lisbon
(24,4 % at the other airports) and landings after the
150th qualify for a discount of 22,5 % at Lisbon (or
31,4 % in the other airports). From the 200th
landing onwards, the discount is 32,7 % at Lisbon
and 40,6 % elsewhere.

The following airlines receive these discounts at
Lisbon airport (the average discount is calculated by
discount
successively
percentages. The resulting figure reflects the actual
discount obtained by the following airlines from
ANA on all of their flights):

applying

different

the

Airline

TAP

Portugalia

Iberia

AF

LH

BA

Swissair

Alitalia

Sabena

Average discount

30

22

8

6

5

4

1

1

1

Source: Monthly landings, by airline — Annex 3 of letter from ANA dated 29 July 1997.

(%)

(7) Case C-323/93 Crespelle [1994] ECR I-5077.
(8) Case C-393/92 Almelo [1994] ECR I-1477.
(9) Paragraph 17.
(10) Corsica Ferries France v. Gruppo Antichi Ormeggiatori del

porto di Genova [1998] ECR I-3949, paragraph 39.

(11) See also Case C-41/90 Hofner and Elser v. Macrotron [1991]
ECR I-1979, paragraph 28; Case C-260/89 ERT v. DRP
[1991] ECR I-2925, paragraph 31;
the Port of Genoa case,
cited in footnote 3, paragraph 14; and Case C-163/96 Silvano
Raso and others [1998] ECR I-0533, recital 25.

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(26)

the 200th qualifies

for a
Every landing after
discount of 32,7 % at Lisbon and 40,6 % at the
other airports, with no limit on the number of
landings thereafter. Thus, airlines which carry out
significantly more than 200 landings a month, such
as TAP and Portugalia, benefit from a proportion-
ally higher overall discount. On any given route on
which TAP or Portugalia are in competition with
other carriers, using the same type of aircraft, they
receive average discounts of 30 % and 22 %
respectively on their landing and take-off charges,
in return for equivalent services provided by ANA,
thereby placing the other carriers at a competitive
disadvantage. The discounts granted to the other
carriers vary between 8 % and 1 % (Iberia 8 %, Air
France 6 %, Lufthansa 5 %, British Airways 4 %,
Swissair, Alitalia and Sabena 1 %) and are therefore
negligible. The de facto effect of this system, there-
fore, is to favour the national carriers, i. e. TAP and
Portugalia.

(27)

The Court of First Instance has held (12) that busi-
ness practices considered to be normal may consti-
tute an abuse within the meaning of Article 86 of
the Treaty if they are carried out by an undertaking
which holds a dominant position.

There must be an objective justification for any
difference in treatment of its various clients by an
undertaking in a dominant position.

There is no objective justification whatsoever for
the difference in treatment applied by ANA to
services (such as approach control and use of apron
areas) which have the same substantive content for
all airlines. As the only means available to a carrier
of providing air transport services to a given town,
airports have a natural monopoly as regards a very
high proportion of their traffic.

No evidence has been supplied by the Portuguese
authorities to demonstrate that
there exist eco-
nomies of scale in this instance. Aircraft receive the
same landing and take-off services, regardless of the
airline to which they belong and whether they are
the first or the 10th aircraft belonging to the
carrier.

— the economies of scale associated with intensive

use of the facilities,

— the promotion of Portugal as a tourist destina-

tion.

(29) As regards the first justification, the Commission
has also initiated proceedings concerning the
system in use at Spanish airports and sent a letter
of formal notice on 28 April 1997. What is more,
the Court of Justice, in particular in its judgment
in Hedley Lomas (13), has held that a Member State
cannot justify an infringement of Community law
on its own part by invoking the fact that another
Member State has likewise failed to comply with its
obligations under Community law.

the

95/364/EC (14),

(30) As regards the second justification, the Portuguese
authorities did not refer to any specific economies
of scale, stating instead that the airport needed to
promote greater utilisation of its facilities. In its
Commission
Decision
responded to the economies of scale argument
thus: ‘the Commission considers that such a system
could be justified solely by economies of scale
achieved by the airways authority. This does not
apply in the case at issue. The airways authority has
not demonstrated to the Commission that handling
the take-off or landing of an aircraft belonging to
one airline rather than to another gives rise to
economies of scale. The handling of the landing or
take-off of an aircraft requires the same service,
irrespective of its owner or the number of aircraft
belonging to a given airline. The airways authority
might, at most, argue that economies of scale occur
at
invoicing since a single invoice
covering a large number of movements can be
issued to a carrier with a high level of traffic whilst
many invoices covering only a few movements are
needed for other carriers. Such economies of scale
are, however, negligible'. The same reasoning
applies in the case in hand, since the handling of
landing and take-off requires the same service,
irrespective of the number of aircraft belonging to a
given airline.

the level of

(28)

The Portuguese authorities put forward three main
justifications
the
for
discount system:

implementation of

the

— competition from Madrid

and Barcelona
airports, which themselves have implemented
this type of discount system,

(12) Case T-65/89 BPB Industries

and British Gypsum v.

Commission [1993] ECR II-389, paragraph 69.

(31)

The goal of promoting increased usage of the facil-
ities, and the third justification, i.e. the promotion
of Portugal as a tourist destination, cannot be
accepted, since these objectives could be achieved
by non-discriminatory discounts accessible to all
airlines operating services to and from the airports
in mainland Portugal.

(13) Case C-5/94 The Queen v. Ministry of Agriculture, Fisheries
and Food, ex parte: Hedley Lomas (Ireland [1996] ECR I-
2553.

(14) Cited in footnote 5, recital 16.

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(32)

The Court has held that where a Member State
induces an undertaking to abuse its dominant posi-
tion by applying dissimilar conditions to equivalent
transactions with other trading parties, within the
meaning of indent (c) of the second paragraph of
Article 86 of
this constitutes an
infringement of the provisions of Articles 90 and
86 of
the Treaty (judgments in Corsica Ferries
II (15), Raso (16) and Corsica Ferries III (17)).

the Treaty,

Where an undertaking in the position of ANA
applies dissimilar conditions to equivalent transac-
tions with other trading parties, thereby placing
them at a competitive disadvantage, this constitutes
an initial abuse of a dominant position within the
meaning of indent (c) of the second paragraph of
Article 86.

(b) The differentiation of charges according to type

of flight (domestic or international)

(33) Article 4(5) of

implementing decree No 38/91
specifies that ‘domestic flights are eligible for a
reduction of 50 %'. The system of differentiated
i.e. either
charges according to type of
domestic or intra-Community, is also an infringe-
ment of the Treaty.

flight,

(34)

the Court of
In this respect,
Justice in Corsica Ferries II (18) case is unequivocal:

the judgment of

‘Article 90(1) and Article 86 of the EEC Treaty
prohibit a national authority from inducing an
undertaking which has been granted the exclusive
right of providing compulsory piloting services in a
common market, by
substantial part of
approving the tariffs adopted by it,
to apply
different tariffs to maritime transport undertakings,
depending on whether
they operate transport
services between Member States or between ports
situated on national territory.'

the

In his opinion, advocate general Van Gerven stated,
moreover, that (19):

‘What is important is that there is no connection
between those differences in tariffs and the nature
of the piloting service offered, which is precisely
the same in both cases (. . .). For my part, I consider
that what is involved here is clearly an instance of
the form of abuse of a dominant position which is
covered by indent (c) of the second paragraph of
the EC Treaty, namely “applying
Article 86 of
transactions
dissimilar conditions

to equivalent

(15) Cited above, footnote 4.
(16) Cited above, footnote 11.
(17) Cited above, footnote 10.
(18) Cited above, footnote 4.
(19) See recital 34.

with other trading parties, thereby placing them at
a disadvantage” (*).

(*) Footnote 61: In this respect, a parallel may be
drawn with the situation at issue in the case of
United Brands (judgment
in case 27/76 United
Brands [1978] ECR 207): there the Court held that
the discriminatory pricing policy practised by
UBC, which invoiced distributor/ripeners at prices
which differed from one Member State to another
for identical quantities and types of bananas consti-
tuted an abuse of a dominant position on the
ground that “these discriminatory practices, which
the
varied according to the circumstances of
Member States, were just so many obstacles to the
free movement of goods” paragraph 232) and that
“a rigid partitioning of national markets was thus
created at price levels which were artificially
different, placing certain distributor/ripeners at a
competitive disadvantage,
since compared with
what it should have been, competition had thereby
been distorted”
same
reasoning can be applied mutatis mutandis in the
present case: the differentiated tariffs charged by
the corporation constitute an obstacle to freedom
to provide intra-Community shipping transport
services and place persons providing such services
at a disadvantageous competitive position.'

(paragraph 233). The

that

it becomes apparent

(35) Applying this line of reasoning to the airports
the system of
sector,
differentiated landing charges established by ANA
has the effect of applying dissimilar conditions for
equivalent landing and take-off services supplied to
thereby placing them at a competitive
airlines,
disadvantage, and thus constitutes an abuse of a
dominant position within the meaning of indent (c)
of the second paragraph of Article 86.

It is obvious that such a system has the direct effect
of placing airlines operating intra-Community
services at a disadvantage by artificially altering the
cost to the undertakings, depending on whether
intra-Community
they
services.

domestic

operate

or

the measure was to provide support

(36) As regards this second infringement of the Treaty,
the Portuguese authorities claim that the objective
of
for the
flights linking the Azores with the mainland, there
being no alternative to them, and for the domestic
services operating from mainland airports, in view
of their short distances and low fares.

The amount of traffic from Member States other
than Portugal
the Azores airports is
negligible. This is why, in recital 20, it is held that
the relevant State measure, inasmuch as it applies

landing at

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16. 3. 1999

to flights serving the Azores, is unlikely to effect
trade between Member States. There is therefore no
need to formulate a response to the argument put
forward by the Portuguese authorities as regards the
application of this system to flights serving the
Azores.

(37) However, it is clear that if, as a consequence of the
liberalisation, as from 1 July 1998, of air traffic to
and from the Azores archipelago, under Article 1(4)
of Council Regulation (EEC) No 2408/92 of 23
July 1992 on access for Community air carriers to
intra-Community air routes (20), as amended by the
Act of Accession of Austria, Finland and Sweden,
Community traffic (21) were to develop between the
Azores airports and the other airports
in the
Community, there could be a case for examining
the relevant State measure as to its compliance with
Articles 90(1) and 86 of the Treaty.

(38) As regards the other domestic flights, the argument
put forward by the Portuguese authorities is that,
since they are so short, the landing charges would
account for too high a proportion of the transport
costs. However, the charge is based on the weight
of the aircraft rather than distance.

(39)

If this line of argument were accepted, flights from
Portugal to Madrid, Seville, Malaga and Santiago
would also have to qualify for this reduction, since
these destinations are situated at a comparable
distance to that
involved in domestic flights.
Distance should therefore also be factored into the
calculation of the charge.

(40) Where an undertaking in the position of ANA
applies dissimilar conditions to equivalent transac-
tions with other trading parties as regards flights to
and from the mainland Portuguese airports, thereby
placing them at a competitive disadvantage, this
constitutes a second abuse of a dominant position
within the meaning of indent (c) of the second
paragraph of Article 86 of the Treaty.

(c) Article 90(2)

(42) Moreover, the Commission considers that, in the
case at issue, application of the competition rules
does not obstruct performance of the particular task
assigned to ANA, which is to maintain and operate
the Portuguese airports. Nor would it obstruct any
specific public-service task assigned to an airline.
The conditions and arrangements governing the
imposition by a Member State of public-service
obligations on intra-Community scheduled air
services are specified in Article 4 of Regulation
(EEC) No 2408/92.

(43)

The derogation provided for in Article 90(2) of the
Treaty does not, therefore, apply.

(d) Conclusion

(44)

(45)

The foregoing analysis establishes that the system
of
the
landing charges used by ANA entails
levying,
for no objective reason, of different
charges, depending on the number of monthly
landings or the origin of the flight (domestic or
intra-Community), in respect of the same runway,
taxiway, apron area and approach control services.

In view of the above, the Commission considers
that the State measure referred to in points l and 2,
as applied in the mainland Portuguese airports, in
so far as it obliges the public undertaking ANA to
apply the abovementioned system, constitutes an
infringement of Article 90(1) of the Treaty, read in
conjunction with Article 86 thereof,

HAS ADOPTED THIS DECISION:

Article 1

The system of discounts on landing charges, differentiated
according to the origin of the flight, provided for at the
airports of Lisbon, Oporto and Faro by Decree-law
(Decreto-Lei) No 102/90 of 21 March 1990,
imple-
menting decree (Decreto Regulamentar) No 38/91 of 29
July 1991 and order in Council (Portaria) No 352/98 of
23 June 1998 constitutes a measure incompatible with
Article 90(1) of
the Treaty, read in conjunction with
Article 86 thereof.

(41)

The Portuguese authorities have not invoked the
the
derogation provided for in Article 90(2) of
Treaty to justify the introduction and maintenance
of such a system of discounts on landing charges.

Article 2

(20) OJ L 240, 24. 8. 1992, p. 8.
(21) According to the timetables published for November 1998 in
the Official Airline Guide (OAG),
there are still no direct
flights between any of the airports in the Azores and any
Community airport outside Portugal.

Portugal shall bring to an end the infringement referred
to in Article 1 and shall inform the Commission within
two months of the date of notification of this Decision of
the measures it has taken to that end.

16. 3. 1999

EN

Official Journal of the European Communities

L 69/39

This Decision is addressed to the Portuguese Republic.

Article 3

Done at Brussels, 10 February 1999.

For the Commission

Karel VAN MIERT

Member of the Commission