COMMISSION STAFF WORKING PAPER Summary of the Impact Assessment
Date: 2011-12-01
Institutions: European Commission
Subjects: air traffic, airport, consumer information, provision of services, transport capacity, transport planning

EUROPEAN COMMISSION 

Brussels, 1.12.2011 
SEC(2011) 1444 final 

COMMISSION STAFF WORKING PAPER 

Summary of the Impact Assessment 

Accompanying the document 

Proposal for a Regulation of the European Parliament and of the Council 

on common rules for the allocation of slots at European Union airports (Recast) 

{COM(2011) 827 final} 
{SEC(2011) 1443 final} 

 
 
 
 
  
 
1. 

PROBLEM DEFINITION 

1.1. 

Sub-optimal allocation and use of airport slots 

1. 

2. 

3. 

In  2009,  800  million  passengers  flew  from  EU  airports  with  recognised  congestion 
issues. The 15 largest airports handled more than half of all passenger air traffic in 
Europe. There are 5 EU airports among the top 25 airports in the world, measured by 
the  total  number  of  passengers  handled.  Demand  currently  exceeds  capacity 
throughout most or all of the day at London Heathrow, London Gatwick, Paris Orly, 
Milan  Linate,  Düsseldorf  and  Frankfurt,  which  together  handled  200  million 
passenger movements in 2009. Demand also exceeds capacity during peak hours at a 
number of other airports (e.g. Amsterdam Schiphol, Madrid Barajas, Paris Charles de 
Gaulle).  Additional  demand  will  outstrip  new infrastructure provision in the future, 
so congestion will increase. 

It  is  therefore  imperative  to  use  existing  airport  capacity  as  efficiently  as  possible. 
There are clear indications that the current EU slot allocation system is not optimal in 
the context of capacity-constrained airports. 

Evaluation  of  the  implementation  of  the  current  Regulation  has  underlined  the 
existence of several problem areas, falling into two main categories: on the one hand, 
the  difficulties  with  the  current  EU  ‘administrative’  system,  and,  on  the  other, 
difficulties  due  to  the  fact  that  the  system  does  not  exploit  the  benefits  of  market-
based mechanisms. 

1.1.1.  The current administrative system is neither complete nor fully implemented 

4. 

5. 

6. 

7. 

Firstly,  the  full  independence  of  slot  coordinators  is  not  sufficiently  guaranteed.  In 
some Member States, the way in which the coordination system is structured could 
be  interpreted  as  limiting  the  independence  of  the  coordinator,  which  should  be 
beyond  doubt.  Additionally,  the  slot  coordinators  do  not  ensure  sufficient 
transparency of slot data. 

Secondly,  in  its  current  form,  the  Slot  Regulation  is  not  fully  compatible  with  the 
future  European  air  traffic  control  system  (Single  European  Sky).  For  instance, 
practical examples from  the  ash cloud crisis and the snow crisis in relation to slots 
showed that the European Union is not prepared to deal with such situations. 

Thirdly, the 80-20 rule, whereby an airline has to use a slot for 80 % of the time in a 
season to be granted the same slot the following year, is not tough enough. Even at 
some  over-subscribed  airports,  over  10 %  of  the  slots  allocated  are  not  used.  In 
addition, at some airports, short series of slots can also result in inefficient capacity 
utilisation,  by  blocking  capacity  in  the  summer  peak  and  preventing  year-round 
services operating. 

Finally, not all the available airport capacity is used, as indicated by the rate of late 
slot  hand-back.  For  operational  reasons,  airlines  normally  request  more  slots  than 
they really need, but evidence shows that a significant percentage of these ‘excess’ 
slots  are  returned  too  late  to  the  pool  to  be  allocated  to  another  carrier.  Moreover, 
sanctions imposed by Member States for misuse of slots vary substantially regarding 

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the  types  of  misuses  that  are  sanctioned  and  the  frequency  with  which  they  are 
applied. 

1.1.1.  The legal framework is no longer adapted to the evolution of the aviation market 

8. 

9. 

10. 

11. 

The  Regulation allows exchanges of slots between airlines, but is not explicit as to 
whether  these  can  be  in  return  for  monetary  or  other  considerations.  In  addition, 
while the Regulation does not specifically allow buying and selling of slots, it does 
not explicitly prohibit this. 

Secondary trading appears to offer benefits in terms of capacity utilisation. However, 
it  is  not  entirely  clear  to  what  extent  secondary  trading  occurs  due  to  a  lack  of 
transparency. Further, it is not permitted at certain airports, including Paris Orly and 
Spanish airports. No information is available on possible contractual constraints in 
the form of covenants, which may dictate to the buyer how such slots can be used, 
making  it  difficult  for  competition  authorities  to  analyse  possible  competition 
concerns. 

Additionally, new entrants are faced with two types of barrier: limitations on access 
to the market and on expansion of their business. Historical preference means that it 
is very difficult for new entrants to challenge the dominant position of the traditional 
incumbent airlines at the most congested airports. Incumbents have little incentive to 
give  up  slots,  even  when  other  carriers  could  use  them  more  efficiently. 
Consequently, at the most congested airports, the slot pool is empty or almost empty. 
When available, slots tend to be awarded to a proliferation of carriers, rather than to a 
larger carrier that may be in a stronger position to offer effective competition to the 
main incumbent. 

The problems identified affect airports, as airport capacity is not efficiently or fully 
used. But they primarily affect airlines, as access to congested airports is limited and 
they cannot obtain the slots that are inefficiently used by other airlines. Airlines are 
also faced with different interpretations by slot coordinators, who in turn lack legal 
certainty as to the correct implementation of the Regulation. Finally, consumers are 
impacted by suboptimal competition, services and prices. 

1.2. 

Analysis of subsidiarity 

12. 

13. 

14. 

The Slot Regulation is essential to the proper functioning of air transport. It responds 
to  the  objective  of  Articles  90  and  91  of  the  Treaty  on  the  Functioning  of  the 
European  Union.  As  the  subsidiarity  principle  applies,  EU  action  regarding  slot 
allocation, as part of the common air transport policy, has to be justified. 

In the present case, this justification centres on the need to ensure that uniform and 
efficient rules exist throughout Europe in order to provide all operators with a level 
playing field. 

In achieving a true internal market for air transport, the EU’s added value should be 
in  implementing  measures  that  take  into  account  the  situation  of  different  airports 
while  ensuring  that  the  competition  between  operators  is  not  hindered.  Individual 
action by Member States could prejudice the internal market. 

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2. 

15. 

3. 

16. 

17. 

OBJECTIVES OF EU INITIATIVE 

The general objective of revising the Slot Regulation is to ensure optimal allocation 
and use of airport slots in congested airports. The specific objectives are to: 

SO1. Ensure strengthened and effectively implemented slot allocation and use 

SO2. Enhance fair competition and the competitiveness of operators. 

The specific objectives can in turn be translated into operational objectives. For SO1, 
these include: reducing late hand back, increasing slot utilisation, and reducing slot 
misuse. For SO2: increasing the number of competitors with a stable slot portfolio, 
increasing  the  number  of  passengers  transported  and  flights  operated  for  the  same 
airport capacity, and enlarging the slot pool. 

POLICY OPTIONS 

The first possible action is repeal of the Regulation, leaving the IATA Worldwide 
Scheduling  Guidelines,  an  industry  code  without  the  force  of  law,  as  the  only 
applicable code for the allocation of slots in Europe. All stakeholders agree that the 
Slot Regulation has dramatically improved the process of slot allocation in Europe, 
and that the amendments in 2004 were a further step in ensuring a neutral and non-
discriminatory allocation process. Therefore this option has been discarded. 

An alternative policy option would be to provide guidance material to supplement 
the existing, unchanged Regulation. Such guidance would be non-binding in nature, 
giving rise to a number of enforcement problems. But, most importantly, many of the 
key problems of sub-optimal slot allocation could not be addressed: guidance would 
conflict  with  the  existing  text  of  the  Slot  Regulation.  Therefore  the  only  valid  EU 
intervention should take the form of a revision of the Slot Regulation. 

18. 

The  stakeholders’  consultation  and  the  2011  study  undertaken  by  Steer  Davies 
Gleave identified a broad set of individual measures with the potential to address the 
many problems identified. 

19. 

The table below sets out the policy measures retained for analysis. 

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Policy measures 

Content of policy measures 

Driver 1: The current administrative system is neither complete nor fully 
implemented 

This measure strengthens organisational and functional independence. It introduces clear rules 
for  the  financing  of  the  coordination  function  and  the  monitoring  of  financial  resources.  This 
measure would strengthen and/or extend the requirements to be met by coordinators regarding 
data. 

This measure would allow slot reservation fees and penalties, and improves and strengthens the 
role of the coordinator in the application of Article 14. 

Strengthen 
- 
independence  of 
slot 
coordinators 
and 
transparency  of 
slot data 

- Ensure correct 
use of slots 

-  Integrate  slot 
allocation in the 
Single 
European Sky 

Coordinators fully cooperate with the Network Manager by providing the slot data necessary to 
ensure  the  functioning  of  the  European  Network.  Airspace  capacity  and  ground  capacity  are 
both  utilised  efficiently  by  ensuring  consistency  between  flight  plans  and  slots.  Future 
performance standards for airports would require consistency between the performance targets 
and slot coordination parameters of the airports. 

Improve 
utilisation 

slot 

The measure would increase the utilisation threshold necessary to retain a slot series above the 
current 80 % and increase the minimum series length above the current 5. 

Define  an  EU 
regime 
for 
secondary 
trading 

Improve 
primary 
allocation 

Driver  2:  Legal  framework  is  no  longer  adapted  to  the  evolution  of  the 
aviation market 

The measure would allow secondary trading at all EU airports, to be conducted under a single 
uniform legal framework. Would address transparency and competition concerns by prohibiting 
restrictive covenants and enhancing pre- and post-trade transparency. 

Two measures have been identified: 

1. Annual withdrawing and auctioning of a share of slots. Consists of withdrawing a percentage 
of  historical  slots  at  highly  congested  airports  where  new  entry  is  severely  restricted. 
Withdrawn slots are then auctioned. 

2.  Amending  the  new  entrant  rule:  modify  the  definition  of  a  new  entrant  by  increasing  the 
number of slots that a carrier may hold at an airport while still being considered a new entrant. 

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20. 

21. 

22. 

23. 

None  of  the  individual  policy  measures  presented  above  achieves  the  objective  of 
optimal slot allocation in isolation. In order to address the sub-optimal allocation and 
use of slots, we propose three policy packages besides the baseline scenario. 

The first policy package (PP1) would improve the effectiveness of slot allocation and 
use within the constraints of the current administrative system. PP1 can be seen as a 
standalone option. 

The second policy package (PP2) consists of a more ambitious package of measures 
entailing  substantial  revision  of  the  Slot  Regulation.  Built  on  PP1,  it  aims  to 
introduce market-based mechanisms for slot allocation at all congested EU airports, 
together with amendment of the new entrant rule, the 80-20 rule and the slot series 
requirements. 

The third package (PP3) is the most ambitious policy package. It comprises PP2, but 
would also entail the withdrawal of slots held by carriers and their allocation to the 
highest bidders through auctioning. 

Policy Package 1 (PP1) 

Policy Package 2 (PP2) 

Policy Package 3 (PP3) 

Content  of 
Policy 
Packages 

-  Strengthen 
and transparency 

independence 

PP1+ 

- Ensure correct use of slots 

- Integrate slot allocation with 
Single European Sky 

Secondary 

- 
transparency 
safeguards 

trading  with 
competition 

and 

PP1 + 

PP2+ 

-  Revision  of  new  entrant  rule- 
Improve slot utilisation 

- Withdrawal of slots and auctions at the 
most congested airports 

4. 

24. 

ASSESSMENT OF IMPACTS 

While the impacts of PP1 on the use of airport capacity are limited, PP2 and PP3 will 
significantly  improve  the  efficient  use  of  airport  capacity.  PP2  will  lead  to  a  1.6 % 
growth in passengers per year whereas PP3 will lead to an increase of 1.9 %-2.0 %. 

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25. 

26. 

27. 

PP2  and  PP3  achieve  by  far  the  greatest  economic  benefits.  However,  PP2  yields 
 2.8 and 
 5.3 billion in net economic benefits whereas PP3 only generates between €
5 billion due to higher operating costs for airlines and direct implementation costs for 
airlines and authorities. 

PP1 will lead to €
 2.4 million in administrative costs due mainly to the collection of 
slot data for airports other than coordinated or schedule-facilitated airports. The only 
costs  incurred  by  PP2  are  the  costs  of  ensuring  transparency  for  secondary  trading 
(around €

 0.2 million). PP3 will not lead to additional costs beyond those of PP2. 

PP3  achieves  the  largest  increase  in  employment  numbers,  but  also  has  the  largest 
negative  impact  on  regional  accessibility.  PP2  leads  to  a  large  increase  in 
employment and has a limited impact on regional accessibility. PP1 has no impact on 
regional accessibility and has lower positive impacts on employment. 

28. 

PP3 and PP2 would produce more negative environmental impacts than PP1. 

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€
The quantified impacts of the different policy measures and combinations are summarised in the table below. 

Option/measure 

Airport 

Pas-
sengers 
(%)

Flights 
(%)

Pas-
sengers 
(million)

Airline 
operating 
costs (€
million)

Direct 
implement-

ation costs (€

million)

Economic 
benefits (€

million)

Net 
economic 
benefits (€

million) Airport Airline

Employment 
(’000 FTEs)

Strengthening

A. 
transparency 

independence 

and 

Total EU-wide 

n/a

n/a

B. Slot reservation fees 

C. Penalties for misuse of slots 

PP1 (A+B+C) 

D. Secondary trading 

E. Revising new entrant rule 

Total EU-wide 

Total EU-wide 

Total EU-wide

Total EU-wide 

Total EU-wide 

Heathrow,  with 
mixed mode 

F. Increasing utilisation threshold to 85 % 

Total EU-wide 

G. Increasing utilisation threshold to 90 % 

Total EU-wide 

H. Extending minimum length of series 

Total EU-wide 

PP2 (PP1+D+E+F+H) 

Total EU-wide

0.3 %

0.1 %

0.4 %

1.2 %

0.0 %

0.2 %

0.1 %

0.3 %

0.0 %

0.0 %

0.2 %

0.0 %

0.1 %

0.2 %

0.3 %

1.6 %

0.0 %

0.1 %

0.2 %

0.2 %

n/a

3.7

1.5

4.5

14.4

0.5

0.2

0.8

2.3

3.6

23.8

I.  Withdrawal  of  grandfather  rights  and 
auctions 

Heathrow 

Orly 

2.6 % –
3.9 %

-0.3 % –

-1.4 %

12.4 % –

-0.3 % –

13.0 %

0.0 %

1.1 – 1.8

2.8 – 2.9

n/a

0.0

0.0

0.0

0.0

0.0

0.0

0.0

535.8

0.0

0.0

708.1 –
2 003.3

0.0 –
695.4

8.7

4.7

19.4

29.5

24.7

0.0

0.2

0.0

0.0

0.0

75.7

25.4

n/a

n/a

868.7

352.7

1 053.2

3 139.7

124.9

864.0

333.3

1 032.5

3 115.1

124.9

22.9

23.1

184.7

536.2

876.3

5 354.7

227.6 –

386.1

184.7

0.4

876.3

5 279.0

-347.4 –

-1 801.1

20.2 –

20.8

611.7 –

-104.6 –

636.9

616.7

0.0

2.5

1.0

3.1

9.9

0.4

0.1

0.5

1.6

2.6

16.4

0.8 –

1.3

2.0

Fares 
(%)

0.0 %

-0.2 %

-0.1 %

-0.2 %

-0.6 %

0.0 %

0.0

4.4

1.5

5.1

34.3

0.6

0.9

-0.2 %

0.9

2.6

4.7

0.0 %

-0.1 %

-0.2 %

9.8 –
11.3

-1.2 % –

-2.0 %

4.4 –

-8.4 % –

4.5

-8.7 %

CO2 
emissions 
(’000 
tonnes) 

0 

719 

254 

842 

5 140 

102 

138 

150 

431 

768 

1 827 

611 – 

624 

8 523 – 
8 775 

45.6

-0.8 %

6 988 

PP3 (PP2+I) 

Total EU-wide

1.9 % –
2.0 %

0.2 %

27.3 –
28.7

708.1 –
2 698.7

113.6 – 119.2

5 620.0 –
5 804.3

2 807.6 –
4 976.9

17.3 –
17.9

55.2 –
56.7

-0.8 %

Note: Financial values presented as net present values of costs/benefits 2012-2025. Non-financial values (passengers, emissions etc.) presented as annual average values 2012-2025.  

Source: Impact assessment of revisions to Regulation 95/93, Steer Davies Gleave, 2011. 

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5. 

29. 

30. 

31. 

32. 

33. 

6. 

34. 

COMPARISON OF OPTIONS 

The policy packages are assessed against the criteria of effectiveness, efficiency and 
coherence. 

From  an  effectiveness  point  of  view,  PP2  seems  the  most  attractive.  It  offers  the 
highest  potential  to  achieve  all  the  specific  objectives,  while  PP3  cannot  attain  the 
most efficient result for SO2. PP1 achieves only SO1 in full. 

Moreover,  analysis  of  the  coherence  between  the  different  policy  packages  shows 
that,  even  if  PP2  involves  significant  trade-offs  between  the  impact  on  the  use  of 
airport capacity plus the positive economic and social impacts, on the one hand, and 
the environmental impacts on the other, the trade-offs are less than for PP3. In terms 
of coherence, PP1 ranks highest. 

Finally,  PP3  is  also  the  most  costly  in  terms  of  airline  operating  costs  and  direct 
costs, while PP1 is the cheapest and the easiest to implement. 

In view of the above, the recommended package is PP2 as the benefits obtained are 
far greater than the costs. It aims to revise the administrative system of slot allocation 
by  introducing  market-based  mechanisms  that  can  correct  its  deficiencies.  The 
system  would  provide  for  strengthened  independence  of  coordinators,  improved 
transparency, more opportunities for new entrants and specific measures to improve 
slot utilisation. 

MONITORING AND EVALUATION 

The  Commission  would  evaluate  the  implementation  of  the  Regulation  three  years 
after  its  adoption  by  the  legislator  and  would  continuously  monitor  a  set  of  core 
transport  indicators  that  are  already  available.  These  indicators  will  be  used  to 
measure to what extent the adopted policy option achieves the specific objectives. 

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