Commission Regulation (EC) No 1459/2006 of 28 September 2006 on the application of Article 81(3) of the Treaty to certain categories of agreements and concerted practices concerning consultations on passenger tariffs on scheduled air services and slot allocation at airports
Date: 2006-09-28
Institutions: European Commission
Subjects: air freight rate, airport, carriage of passengers, competition, exemption from restrictive-practice authorisation, inter-company agreement

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COMMISSION REGULATION (EC) No 1459/2006

of 28 September 2006

on the application of Article 81(3) of the Treaty to certain categories of agreements and concerted
practices concerning consultations on passenger tariffs on scheduled air services and slot allocation
at airports

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty
Community,

establishing the European

services and slot allocation and airport scheduling are
liable to restrict competition and affect trade between
Member States.

Having regard to Council Regulation (EEC) No 3976/87 of 14
December 1987 on the application of Article 85(3) of
the
Treaty to certain categories of agreements and concerted
sector (1), and in particular
practices
Article 2 thereof,

in the air

transport

Having published a draft of this Regulation (2),

consulting the Advisory Committee on Restrictive

After
Practices and Dominant Positions,

Whereas:

(1)

(2)

(3)

Since 1 May 2004, the air transport sector has been
subject to the generally applicable provisions of Council
Regulation (EC) No 1/2003 of 16 December 2002 on
the implementation of
the rules on competition laid
down in Articles 81 and 82 of the Treaty (3).

Regulation (EC) No 1/2003 provides that agreements
which fall under Article 81(1) of
the Treaty which
satisfy the conditions of Article 81(3) are not prohibited,
no prior decision to that effect being required.
In
and associations must now
principle, undertakings
assess
agreements,
their
concerted practices and decisions are compatible with
Article 81 of the Treaty.

themselves whether

for

Regulation (EEC) No 3976/87 empowers
the Com-
mission to apply Article 81(3) of the Treaty by Regu-
lation to certain categories of agreements, decisions or
concerted practices relating directly or indirectly to the
provision of air transport services on routes between
Community
and on routes between the
Community and third countries.

airports

(4)

Agreements, decisions or concerted practices concerning
tariffs on scheduled air
consultations on passenger

(1) OJ L 374, 31.12.1987, p. 9. Regulation as last amended by Regu-

lation (EC) No 411/2004 (OJ L 68, 6.3.2004, p. 1).

(2) OJ C 42, 18.2.2006, p. 15.
(3) OJ L 1, 4.1.2003, p. 1. Regulation as amended by Regulation (EC)

No 411/2004 (OJ L 68, 6.3.2004, p. 1).

(5)

(6)

(7)

However, since such agreements, decisions or concerted
practices may benefit air
transport users and/or air
carriers, Commission Regulation (EEC) No 1617/93 of
25 June 1993 on the application of Article 85(3) of
the Treaty to certain categories of agreements and
concerted practices concerning joint planning and coor-
dination of schedules, joint operations, consultations on
passenger and cargo tariffs on scheduled air services and
slot allocation at airports (4) declared that Article 81(1) of
the Treaty did not apply, inter alia, to certain agreements,
decisions or concerted practices concerning consultations
on tariffs and slot allocation at airports for air services
between Community airports. Regulation (EEC) No
1617/93 expired on 30 June 2005.

In June 2004 the Commission initiated a consultation
on the revision of Regulation (EEC) No 1617/93 to
the block exemption should be
determine whether
discontinued, maintained in its original
form or
extended in scope. The Commission received responses
from Member States, airlines, travel agents and consumer
groups.

In view of the results of the consultation and the directly
applicable exception system introduced by Regulation
(EC) No 1/2003,
there are not sufficient grounds to
inap-
continue to declare by Regulation Article 81(1)
plicable to consultations on slot allocation and airport
scheduling agreements or to consultations on tariffs for
the carriage of passengers, with their baggage, on
scheduled air
services between Community airports.
However, the airline industry should be allowed sufficient
time to adapt to the new situation and to assess for
themselves whether their agreements and practices are
compatible with Article 81 of
if
necessary, to amend them. Since Regulation (EEC) No
1617/93 has already expired, it is necessary to adopt a
new block exemption regulation for a transitional period.

the Treaty and,

(4) OJ L 155, 26.6.1993, p. 18. Regulation as last amended by the

2003 Act of Accession.

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Arrangements on slot allocation at airports and airport
scheduling can improve the efficient utilization of airport
capacity and airspace, facilitate air-traffic control and help
to spread the supply of air transport services from the
airport. Entry to congested airports must remain possible
if competition is not
In order to
provide a satisfactory degree of security and transparency,
arrangements in this respect can only be accepted if all
air carriers concerned can participate in the negotiations,
and if the allocation is made on a non-discriminatory
and transparent basis.

to be eliminated.

the airline industry should assess for
After that date,
itself whether
and concerted practices
agreements
between undertakings and decisions of associations of
undertakings caught by Article 81(1) of
the Treaty
satisfy the conditions of Article 81(3) of the Treaty.

(13)

Since 1 May 2004,
the Commission has been
empowered to apply Article 81(3) of the Treaty by Regu-
lation in respect of air services on routes between the
Community and third countries, as well as on routes
between Community airports.

(8)

(9)

(14)

for

A block exemption should be granted until 31 December
2006 in respect of consultations on slot allocation and
airport scheduling in so far as they concern air services
the point of origin and/or point of destination of which
is located in the Community. After 31 December 2006,
the airline industry should assess
itself whether
agreements and concerted practices between under-
takings and decisions of associations of undertakings
the Treaty satisfy the
caught by Article 81(1) of
conditions of Article 81(3). The assessment
should,
inter alia, consider whether all carriers concerned can
participate in the consultations on slot allocation and
airport scheduling, and whether these consultations are
conducted in a non-discriminatory and transparent
manner. This Regulation is without prejudice
to
Council Regulation (EEC) No 95/93 of 18 January
1993 on common rules for the allocation of slots at
Community airports (1).

(10)

Consultations on passenger tariffs may contribute to the
generalised acceptance of interlinable passenger tariffs to
the benefit of air carriers as well as air transport users.
However, consultations must not exceed the aim of facil-
itating interlining.

(11)

the

results of

consultation initiated by

The
the
Commission in June 2004 for the review of Regulation
(EEC) No 1617/93 indicate that the intra-Community air
transport market has evolved in such a way that the
degree of assurance that consultations on tariffs will
continue to meet all the criteria of Article 81(3) of the
Treaty is declining.

to intra-Community air-traffic, air services
In contrast
between Member States and third countries are,
in
general, governed by bilateral air services agreements.
The nature and level of detail of regulatory requirements
in these agreements vary widely. Without
set out
prejudice to Community law, including Regulation (EC)
No 847/2004 of the European Parliament and of the
Council of 29 April 2004 on the negotiation and imple-
mentation of air service agreements between Member
States and third countries (2),
is common for air
services agreements to restrict and/or regulate market
access and/or pricing, which may impede competition
between air carriers on routes between the Community
is common for air
and third countries. Moreover,
services agreements to restrict the ability of carriers to
enter into the kind of bilateral cooperation agreements
which provide consumers with alternatives to the Inter-
national Air Transport Association (IATA)
interlining
system.

it

it

(15) On routes between the Community and third countries,
involving a
the proportion of passenger
connection is
than on intra-
appreciably higher
Community international flights. Therefore, the benefits
of
interlining for consumers obtained through tariff
consultations should be greater on routes between the
Community and third countries.

journeys

(12) A block exemption should therefore be granted until 31
December 2006 in respect of consultations on tariffs for
the carriage of passengers, with their baggage, on
services between Community airports.
scheduled air

(1) OJ L 14, 22.1.1993, p. 1. Regulation as last amended by Regulation
(EC) No 793/2004 of the European Parliament and of the Council
(OJ L 138, 30.4.2004, p. 50).

(16)

It can be assumed with sufficient certainty that consul-
tations on tariffs for the carriage of passengers, with their
baggage, on scheduled air services between points in the
in third countries currently
Community and points
satisfy the conditions of Article 81(3) of
the Treaty.
transport are undergoing
However, markets
rapid developments. A short block exemption should
therefore be granted in respect of such consultations
until 31 October 2007.

for air

(2) OJ L 157, 30.4.2004, p. 7, as corrected by OJ L 195, 2.6.2004, p. 3.

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(17)

in the United States of
The competent authorities
America and Australia are reviewing their
respective
antitrust policies in respect of IATA tariff conferences.
These reviews are likely to be completed by June 2007.
It is, therefore, appropriate that the Commission should
review the block
tariff
conferences with respect
between the
Community and these countries by that time.

exemption for passenger
to routes

(18) Data should be collected to enhance the Commission’s
knowledge on the relative use of the passenger tariffs set
in the consultations and their relative importance for
actual
interlining on scheduled services between the
Community and third countries. The data should also
enable the Commission to better assess the effects of
regulatory restrictions flowing from bilateral air services
agreements. Air carriers participating in consultations
should therefore be required to collect data for all fare
classes in which interlinable fares are agreed, for each
IATA season starting from 1 May 2004.

(19)

(20)

(21)

In accordance with Article 4 of Regulation (EEC) No
3976/87, this Regulation should apply with retroactive
effect to agreements, decisions and concerted practices in
existence on the date of entry into force of this Regu-
lation, provided that
for
they meet
exemption set out in this Regulation.

the conditions

treated in the

is
Community law in the field of civil aviation that
for the internal market was extended to the
relevant
area comprising the Community and Norway,
Iceland
and Liechtenstein through the Agreement on the
European Economic Area. Therefore,
flights between
the Community and Norway, Iceland and Liechtenstein
should be
intra-
Community flights. Community legislation is extended
to the territory covered by the EEA Agreement through
decisions by the EEA Joint Committee. For the purposes
of this Regulation, however, it is necessary to stipulate
the block exemption provided for in respect of
that
apply to flights
extra-Community flights does not
between points
in
Norway, Iceland and Liechtenstein.

in the Community and points

same manner

as

comprising

Community law in the field of civil aviation that
relevant
area
through
Community
Transport (1). As long as that agreement
force,

is
for the internal market was extended to the
Switzerland
European
between
and the Swiss Confederation on Air
remains in
flights between the Community and

the Community

the Agreement

therefore,

and

the

(1) Agreement between the European Community and the Swiss
Confederation on Air Transport (OJ L 114, 30.4.2002, p. 73).

flights. Community

Switzerland should be treated in the same manner as
intra-Community
legislation is
extended to the territory covered by the Agreement
through decisions by the Joint Committee set up under
this Regulation,
the Agreement. For the purposes of
however,
the block
is necessary to stipulate that
exemption provided for in respect of routes between
the Community and third countries does not apply to
flights between points in the Community and points in
Switzerland.

it

(22)

This Regulation is without prejudice to the application of
Article 82 of the Treaty,

HAS ADOPTED THIS REGULATION:

Article 1

Exemptions

to Article 81(3) of

the Treaty and subject

Pursuant
to the
provisions of this Regulation, it is hereby declared that Article
81(1) of the Treaty shall not apply to agreements between
undertakings in the air transport sector, decisions by asso-
ciations of such undertakings and concerted practices between
such undertakings which have as their purpose one or more of
the following:

(a)

the holding of consultations on slot allocation and airport
scheduling in so far as they concern air services the point of
origin and/or point of destination of which is located in the
Community;

(b) the holding of consultations on tariffs for the carriage of
passengers, with their baggage, on scheduled air services
between points in the Community or between points in
the Community, on the one hand, and points in Swit-
zerland, Norway, Iceland or Liechtenstein, on the other;

(c)

the holding of consultations on tariffs for the carriage of
passengers, with their baggage, on scheduled air services
between points in the Community, on the one hand, and
points in Australia or the United States of America, on the
other;

(d) the holding of consultations on tariffs for the carriage of
passengers, with their baggage, on scheduled air services
between points in the Community, on the one hand, and
points in third countries other than those referred to in
points (b) and (c), on the other.

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Article 2

Slot allocation and airport scheduling

Article 1(a) shall apply only if the following conditions are

1.
fulfilled:

(ii)

requested slots (initial submissions) by air carrier,
chronological order, for all air carriers;

in

(iii) allocated slots, and outstanding slot requests listed indi-
vidually in chronological order, by air carrier, for all air
carriers;

(a)

the consultations are open to all air carriers having
expressed an interest in the slots which are the subject of
the consultations;

(iv) remaining slots available;

(b) rules of priority are established and applied without discri-
mination, whether direct or indirect, on the grounds of
carrier identity, nationality or category of service, which
traffic distribution
take into account constraints or air
rules laid down by competent national or international
authorities and give due consideration to the needs of the
travelling publics and of the airport concerned; subject to
point (c), such rules of priority may take account of rights
acquired by air carriers through the use of particular slots in
the previous corresponding season;

(c) slots are allocated to new entrants, as defined in Article 2(b)

of Regulation (EEC) No 95/93 as follows:

(i) at Community airports, a 50 % share of newly created
or unused slots and slots which have been given up by a
carrier during or by the end of the season or which
otherwise become available to enable new entrants to
be able to compete effectively with established carriers
on routes to/from the airport in question; the share
allocated to new entrants may be less than 50 % if
requests by new entrants represent less than 50 % of
all applications for such new slots;

(ii) at

third country airports, a sufficient share of such
to
available
remain possible on routes between such airports and
points located in the Community;

congested airports

entry at

slots

for

(d) the rules of priority, once established, are made available on

request to any interested party;

(e) air carriers participating in the consultations have access, at
the time of the consultations at the latest, to information
relating to:

(i) historical slots by air carrier, in chronological order, for

all air carriers at the airport;

(v)

full details of the criteria used in the allocation;

(f)

if a request
the air carrier
concerned is entitled to a statement of the reasons therefor.

is not accepted,

slots

for

2.
The Commission and the Member States concerned shall
be entitled to send observers to consultations on slot allocation
and airport scheduling held in the context of a multilateral
this purpose, air
meeting in advance of each season. For
carriers
shall give the Member States concerned and the
Commission the same notice as is given to participants of the
date, venue and subject matter of the consultations. The notice
given to the Member States concerned and to the Commission
shall not be less than 10 days.

Such notice shall be given:

(a)

to the Member States concerned according to procedures to
those
be established by the competent authorities of
Member States;

(b) to the Commission according to procedures to be published

in the Official Journal of the European Union.

Article 3

Consultations on passenger tariffs

Article 1(b), (c) and (d) shall apply only if the following

1.
conditions are fulfilled:

(a)

the participants in the consultations only discuss air fares to
be paid by air transport users directly to a participating air
carrier or to its authorised agents, for carriage as passengers
on a scheduled service, and the conditions relating to those
passenger tariffs; the consultations do not extend to the
capacity for which such tariffs are to be available;

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(b) the consultations give rise to interlining, that is to say, air
transport users are able, in respect of the types of passenger
tariffs and of the seasons which were the subject of the
consultations:

for

Air carriers participating in consultations on passenger
2.
tariffs
in the
Community and points in third countries other than those
referred to in Article 1(b) shall collect data with regard to:

services between points

scheduled air

(i)

to combine on a single ticket the service which was the
subject of the consultations, with services on the same
or on connecting routes operated by other air carriers,
whereby the applicable passenger tariffs and conditions
are set by the airline or airlines effecting carriage; and

(a)

the number of tickets issued at tariffs set in the consul-
tickets issued for travel
tations in the total number of
between the Community and third countries other than
those referred to in Article 1(b);

(ii) in so far as is permitted by the conditions governing the
initial reservation, to change a reservation on a service
which was the subject of
the consultations onto a
service on the same route operated by another air
carrier at the passenger tariffs and conditions applied
by that other carrier;

(c) an air carrier is entitled to refuse to allow combinations and
changes of reservation for objective and non-discriminatory
reasons of a technical or commercial nature, in particular
where the air carrier effecting carriage is concerned about
the air carrier who would be
the credit worthiness of
collecting payment
in which case the
latter air carrier must be notified thereof in writing;

for this carriage,

(d) the passenger tariffs which are the subject of the consul-
tations are applied by participating air carriers without
discrimination on grounds of passenger nationality or
place of residence;

(e) participation in the consultations is voluntary and open to
any air carrier who operates or intends to operate direct or
indirect services on the route concerned;

(b) the extent to which tickets at tariffs set in the consultations
are issued for travel on a journey where the passenger
interlines;

(c)

the extent to which tickets which are not at tariffs set in the
consultations are issued for travel on a journey where the
passenger interlines.

That data shall be collected for all types of ticket and fare which
are the subject of the consultations. The data shall make it
possible to distinguish between the various forms of coop-
eration between air carriers that enable passengers to combine
services operated by more than one carrier onto a single ticket.
The data collected shall be provided to the Commission by or
on behalf of the air carriers involved for each IATA season,
starting from 1 May 2004. The data may be made available
to the competent authorities of the Member States.

3.
The Commission and the Member States concerned shall
be entitled to send observers to consultations on passenger
tariffs. For this purpose, air carriers shall give the Member
States concerned and the Commission the same notice as is
given to participants of the date, venue and subject matter of
the consultations. The notice given to the Member States
concerned and to the Commission shall not be less than 10
days.

(f)

the consultations are not binding on participants, that is to
say, following the consultations the participants retain the
right to act independently in respect of passenger tariffs;

Such notice shall be given:

(g) the consultations do not entail agreement on agents' remu-

neration or other elements of the tariffs discussed.

(a)

to the Member States concerned according to procedures to
be established by the competent authorities of
those
Member States;

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(b) to the Commission according to procedures to be published

in the Official Journal of the European Union.

Exemptions granted pursuant to Article 1(a) and (b) shall apply
until 31 December 2006.

A full report on the consultations shall be submitted to the
Commission by or on behalf of the air carriers involved at
the same time as it is submitted to participants, but not later
than six weeks after the consultations were held.

Article 4

Entry into force

This Regulation shall enter into force on the 20th day following
its publication in the Official Journal of the European Union.

Exemptions granted pursuant to Article 1(c) shall apply until
30 June 2007.

Exemptions granted pursuant to Article 1(d) shall apply until
31 October 2007.

This Regulation shall
to
agreements, decisions and concerted practices in existence on
the day on which it enters into force, with effect from the time
when the conditions set out in this Regulation were fulfilled.

apply with retroactive

effect

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Brussels, 28 September 2006.

For the Commission

Neelie KROES
Member of the Commission