CELEX: 31987L0601
Language: en
Date: 1987-12-14 00:00:00
Title: Council Directive 87/601/EEC of 14 December 1987 on fares for scheduled air services between Member States

No L 374 / 12                               Official Journal of the European Communities                                      31 . 12 . 87
                                                                        II
                                                  (Acts whose publication is not obligatory)
                                                             COUNCIL
                                                          COUNCIL DIRECTIVE
                                                            of 14 December 1987
                                         on fares for scheduled air services between Member States
                                                                ( 87 / 601 / 87 )
   THE COUNCIL OF THE EUROPEAN COMMUNITIES ,                                 Whereas, by virtue of Article 189 of the Treaty, Member
                                                                             States may choose the most appropriate means of
                                                                             implementing the provisions of the Directive, and in
   Having regard to the Treaty establishing the European                     particular may apply the criteria laid down in Article 3
  Economic Community, and in particular Articles 84 (2)                      more precisely ;
   and 227 ( 2) thereof,
                                                                            Whereas procedures should be established for the
  Having regard to the proposal from the Commission (*),                    submission by air carriers of proposed air fares and their
                                                                            express of automatic approval by the Member States
                                                                            concerned; whereas air carriers should be free to propose
  Having regard to the opinions of the European                             air fares individually or after consultation with other air
  Parliament ( 2 ),                                                         carriers for the purpose, in particular, of fixing the terms of
                                                                            interlining agreements, given the important benefits which
                                                                            they confer ;
  Having regard to the opinion of the Economic and Social
  Committee ( 3 ),
                                                                            Whereas provision should be made for rapid consultation
  Whereas more flexible procedures for approving scheduled
                                                                            between Member States in the case of any disagreement
  passenger air fares for air services between Member States
                                                                            and for procedures for settling such disagreements
  will give air carriers greater scope to develop markets and
                                                                           regarding approval of fares as are not resolved by
                                                                           consultations ;
  better meet consumer needs;
 Whereas air carriers should be encouraged to control their                Whereas provision should be made for the regular
 costs, increase productivity and provide efficient and                    consultation of consumer groups on matters relating to air
                                                                           fares ;
 attractively priced air services ;
                                                                           Whereas the Heads of State and Government , at their
 Whereas common rules should be established laying down                    meeting in June 1986 , agreed that the internal market in air
 criteria for the approval of air fares;                                   transport should be completed by 1992 in pursuance of
                                                                           Community actions leading to the strengthening of its
                                                                           economic and social cohesion; whereas the provisions of
                                                                           this Directive on fares are a first step in this direction and
(') OJ No C 78 , 30 . 3 . 1982 , p. 6 .                                    the Council will therefore, in order to meet the objective set
(2) OJ No C 322, 28 . 11 . 1983 , p. 10 and OJ No C 345 ,                  by the Heads of State and Government, adopt further
     21 . 12 . 1987 .
                                                                           measures of liberalization in respect of air fares at the end
( 3) OJ No C 77, 21 . 3 . 1983 , p. 26 .                                   of a three year initial period ,
 ---pagebreak--- 31 . 12 . 87                                 Official Journal of the European Communities                                      No L 374 / 13
HAS ADOPTED THIS DIRECTIVE :                                                        the majority of whose shares are owned by
                                                                                    nationals of Member States and / or Member States
                                                                                    and which is effectively controlled by such persons
                                                                                    or States , or
                       Scope and definitions
                                                                             ( ii ) an air carrier which , although it does not meet the
                             Article 1                                              definition set out in ( i ), at the time of adoption of
                                                                                    this Directive :
This Directive shall apply to criteria and procedures to be                         A. either      has   its  central  administration     and
applied with respect to the establishment of scheduled air                                principal place of business in    the Community
fares charged on any route between an airport in one                                       and has been providing             scheduled or
Member State and an airport in another Member State .                                      non-scheduled air services in    the Community
                                                                                           during the 12 months prior to    adoption of this
                                                                                           Directive .
This Directive shall not apply to the overseas departments
referred to in Article 227 (2 ) of the Treaty .                                     B. or has been providing scheduled services
                                                                                           between Member States on the basis of the
                                                                                           third- and fourth-freedoms of the air during the
                                                                                           12 months prior to adoption of this Directive.
                              Article 2
                                                                             The enterprises which meet the above criteria are listed
 For the purposes of this Directive:                                         in Annex I ;
( a) scheduled air fares means the prices to be paid in the
      applicable national currency for the carriage of                  (g) States concerned mean the Member States between
      passengers and baggage on scheduled air services and                   which the scheduled air service in question is
      the conditions under which those prices apply ,                        operated ;
      including remuneration and conditions offered to
      agency and other auxiliary services;                              (h) scheduled air service means a series of flights each
                                                                             possessing all the following characteristics :
^ b) zone of flexibility means a pricing zone as referred to in
      Article 5 , within which air fares meeting the conditions                 ( i) it passes through the air space over the territory of
      in Annex II qualify for automatic approval by the                               more than one Member State ;
      aeronautical authorities of the Member States . The
      limits of a zone are expressed as percentages of the                     (ii) it is performed by aircraft for the transport of
      reference fare;                                                                 passengers or passengers and cargo and / or mail
                                                                                      for remuneration , in such a manner that on each
(c) reference fare means the normal economy air fare                                  flight seats are available for purchase by members
      charged by a third- or fourth-freedom air carrier on the                        of the public (either directly from the air carrier or
      routes in question; if more than one such fare exists,                          from its authorized agents);
      the average level shall be taken unless otherwise
      bilaterally agreed ; where there is no normal economy                  ( iii) it is operated so as to serve traffic between the
      fare , the lowest fully flexible fare shall be taken ;                          same two or more points, either:
                                                                                      ( 1 ) according to a published timetable, or
(d) air carrier means an air transport enterprise with a valid
     operating licence to operate scheduled air services ;                            (2) with flights so regular of frequent that they
                                                                                            constitute a recognisably systematic series ;
(e) a third freedom air carrier means an air carrier having
     the right to put down , in the territory of another State ,
     passengers , freight and mail taken up in the State in             ( i) flight means a departure from a specified airport
     which it is registered ;                                                towards a specified destination .
     a fourth-freedom air carrier means an air carrier having
     the right to take on , in another State , passengers ,
     freight and mail for off-loading in its State of
     registration ;
                                                                                                           Criteria
     a fifth-freedom air carrier means an air carrier having
     the right to undertake the commercial air transport of
     passengers , freight and mail between two States other                                               Article 3
     than its State of registration ;
                                                                        Without prejudice to Article 5 ( 2), Member States shall
(f) Community air carrier means:                                        approve air fares if they are reasonably related to the
                                                                        long-term fully allocated costs of the applicant air carrier,
     ( i ) an air carrier which has its central administration          while taking into account other relevant factors . In this
           and principal place of business in the Community ,           connection , they shall consider the needs of consumers, the
 ---pagebreak--- No L 374 / 14                             Official Journal of the European Communities                                       31 . 12 . 87
need for a satisfactory return on capital , the competitive          5 . Only third- and fourth-freedom air carriers shall be
market situation , including the fares of the other air             permitted to act as price leaders .
carriers operating on the route, and the need to prevent
dumping. However, the fact that a proposed air fare is
lower than that offered by another air carrier operating on                                        Article 5
the route shall not be sufficient reason for withholding
approval .
                                                                     1 . There shall be two zones of flexibility on any scheduled
                                                                     air service as follows :
                                                                     — a discount zone which shall extend from 90 % to more
                            Procedures                                    than 65 % of the reference fare;
                              Article 4                              — a deep-discount zone which shall extend from 65 % to
                                                                          45 % of the reference fare .
1 . Air fares shall be subject to approval by the
aeronautical authorities of the States concerned . To this           2 . Within zones of flexibility , the States concerned shall
end , an air carrier shall submit its fares in the forms             permit third- or fourth-freedom air carriers to charge
prescribed by those authorities .                                    discount and deep-discount air fares of their own choice
                                                                     subject to the respective conditions set out in Annex II and
                                                                     provided those air fares have been filed with the States
This shall be done either :                                          concerned at least 21 days prior to the proposed date for
                                                                     their entry into force .
( a) individually ,
      or
                                                                     3 . If a fare which has been, or is, approved under the
                                                                     bilateral approval regime and which , as far as its conditions
( b ) following consultations with other air carriers ,              are concerned , qualifies for automatic approval in the
      provided that such consultations comply with the               deep-discount zone , is below the floor of that zone, there
      requirements of regulations issued pursuant to Council         shall be additional flexibility as to the level of that fare .
      Regulation (EEC ) No 3976 / 87 of 14 December 1987             Such additional flexibility shall extend from 10 % below
      on the application of Article 85 ( 3 ) of the Treaty to        the bilaterally approved level of that fare to the ceiling of
      certain categories of agreements and concerted practices       the deep-discount zone .
      in the air transport sector . 0 )
                                                                     A fare which is entitled to additional flexibility in
                                                                     accordance with this paragraph shall be renewed in
Aeronautical authorities shall not require air carriers to
                                                                     successive fare seasons at the request of the air carrier
submit their fares for approval more than 60 days before             concerned at a level not lower than the percentage of the
they come into effect.
                                                                     reference fare at which it stood at the end of the previous
                                                                     fare season , any change in level of the reference fare being
                                                                     duly taken into account . For the purpose of this paragraph ,
2 . Subject to Article 5 , and without prejudice to Article 6 ,      summer       and    winter    fare   seasons    shall  be    treated
fares shall require approval by both the States concerned . If       separately .
neither of the aeronautical authorities has expressed
disapproval within 30 days of the date of submission of a
fare , it shall be considered as approved .
                                                                                                   Article 6
                                                                     This Directive shall not prevent Member States from
3 . An air fare , once approved , shall remain in force until        concluding arrangements which are more flexible than the
it expires or is replaced . It may however be prolonged after        provisions of Articles 4 and 5 or from maintaining such
its original date of expiry for a period not exceeding               arrangements in force .
12 months .
                                                                                                   Article 7
4 . A Member State shall permit an air carrier of another
Member State operating a direct or indirect scheduled air
service , on giving due notice , to match an air fare already        1 . When a State concerned ( the first State) decides , in
approved between the same city pairs. This provision shall           conformity with the above Articles , not to approve a
not apply to indirect services which exceed the length of the        scheduled air fare, it shall inform the other State concerned
shortest direct service by more than 20 % .                          (the second State) in writing within 21 days of the fare
                                                                     being filed , stating its reasons .
                                                                     2 . If the second State disagrees with the decision of the
(') See p. 9 of this Official Journal .                              first State , it shall so notify the first State within seven days
 ---pagebreak---      31 . 12 . 87                               Official Journal of the European Communities                                 No L 374 / 15
     of being informed , providing the information on which its               the Directive or the award does not comply with
     decision is based, and request consultations. Each State                 Community law in other respects.
     shall supply all relevant information requested by the
     other. Either of the States concerned may request that the
     Commission be represented at the consultations.                          In the absence of any decision within this period, the award
                                                                              shall be regarded as confirmed by the Commission. An
                                                                              award confirmed by the Commission shall become binding
                                                                             on the States concerned .
     3 . If the first State has insufficient information to reach a
     decision on the fare, it may request the second State to
    enter into consultations before the expiry of the 21 -day                9 . During the consultation and arbitration procedure, the
    period prescribed in paragraph 1 .                                       relevant existing air fares shall be continued in force until
                                                                             the procedure has expired and any new fare has entered
                                                                             into force .
    4. Consultations shall be completed within 21 days of
    being requested. If disagreement still persists at the end of                                 General provisions
    this period, the matter shall be put to arbitration at the
    request of either of the States concerned. The two States                                          Article 8
    concerned may agree to prolong the consultations or to
    proceed directly to arbitration without consultations .                 At least once a year, the Commission shall consult on air
                                                                            fares and related matters with representatives of
                                                                            air-transport user organizations in the Community, for
                                                                            which purpose the Commission shall supply appropriate
   5 . Arbitration shall be carried out by a panel of three                 information to the participants.
   arbitrators unless the States concerned agree on a single
   arbitrator. The States concerned shall each nominate one
   member of the panel and seek to agree on the third member
   (who shall be a national of a third Member State and act as                                         Article 9
   panel chairman). Alternatively they may nominate a single
   arbitrator. The appointment of the panel shall be                       1 . By 1 November 1989, the Commission shall publish
   completed within seven days. A panel's decisions shall be               a report on the application of this Directive, which
   reached by a majority of votes .                                        shall include statistical information on the cases in which
                                                                           Article 7 has been invoked .
   6 . In the event of failure by either State concerned to                2. Member States and the Commission shall cooperate in
   nominate a member of the panel or to agree on the                       the application of this Directive, particularly as regards the
   appointment of a third member, the Council shall be                     collection of the information referred to in paragraph 1 .
  informed forthwith and its President shall complete the
  panel within three days. In the event of the Presidency
  being held by a Member State which is party to the dispute,              3 . Confidential information obtained in application of
  the President of the Council shall invite the Government of             this Directive shall be covered by professional secrecy.
  the next Member State due to hold the presidency and not
  party to the dispute to complete the panel .
                                                                                                     Article 10
                                                                          Where a Member State has concluded an agreement with
 7. The arbitration shall be completed within a period of                 one or more non-member countries which gives
 21 days of completion of the panel or nomination of the                  fifth-freedom rights for a route between Member States to
 single arbitrator. The States concerned may, however,                   an air carrier of a non-member country, and in this respect
 agree to extend this period . The Commission shall have the             contains provisions which are incompatible with this
 right to attend as an observer. The arbitrators shall make              Directive, the Member State shall, at the first opportunity,
 clear the extent to which the award is based on the criteria            take       al!   aPProPriate     steps to      eliminate    such
 in Article 3 .
                                                                         incompatibilities. Until such time as the incompatibilities
                                                                         have been eliminated, this Directive shall not affect the
                                                                         rights and obligations vis-a-vis non-member countries
                                                                         arising from such an agreement.
 8 . The arbitration award shall be notified immediately to
the Commission .
                                                                                                     Article 11
Within a period of 10 days, the Commission shall confirm                 1 . After consultation with the Commission, the Member
the award, unless the arbitrators have not respected the                 States shall take the necessary steps to comply with this
criteria set out in Article 3 or the procedure laid down by              Directive by 31 December 1987 .
 ---pagebreak--- No L 374 / 16                              Official Journal of the European Communities                                                 31 . 12 .
2 . Member States shall communicate to the Commission                                                         Article 13
all the laws, regulations and administrative provisions
which they adopt for the application of this Directive.                     This Directive is addressed to the Member States .
                                                                             Done at Brussels , 14 December 1987
                          Article 12
                                                                                                                       For the Council
The Council shall decide on the revision of this Directive by                                                            The President
30 June 1990, on the basis of a Commission proposal to be
submitted by 1 November 1989 .                                                                                     U. ELLEMANN-JENSEN
                                                                   ANNEX I
                                                    Airlines referred to in Article 2 ( f) ( ii)
              The following airlines meet the criteria referred to in Article 2 ( f) (ii ) as long as they are recognized as a national
              carrier by the Member State which so recognizes them at the time of the adoption of this Directive:
              — Scandinavian Airlines System ,
              — Britannia Airways ,
              — Monarch Airlines .
 ---pagebreak--- 31 . 12 . 87                                     Official Journal of the European Communities                                     No L 374 / 17
                                                                        ANNEX II
                                                  Conditions for discount and deep-discount fares
             DISCOUNT ZONE
             1 . To qualify for the discount zone all of the following conditions must be met:
                 ( a ) round or circle trip ;
                 ( b) maximum stay of six months;
                        and either
                 (c) minimum stay of not less than Saturday night or six nights
                       or
                 (d) if off-peak (as defined in the Appendix ) advance purchase of not fewer than 14 days; reservation for the
                       entire trip , ticketing and payment to be made at the same time; cancellation or change of reservation
                       only available prior to departure of outbound travel and at a fee of at least 20 % of the price of the
                       ticket .
             DEEP-DISCOUNT ZONE
             2 . To qualify for the deep-discount zone, a fare must meet:
                 — either conditions 1 ( a), (b) and (c) and one of the following conditions:
                       ( a ) reservation for the entire trip , ticketing and payment to be made at the same time; cancellation or
                             change of reservation only available prior to departure of outbound travel and at a fee of at least
                             20 % of the price of the ticket;
                       (b) mandatory advance purchase of not fewer than 14 days; reservation for the entire trip, ticketing and
                             payment to be made at the same time; cancellation or change of reservation only available prior to
                             departure of outbound travel and at a fee of at least 20 % of the price of the ticket;
                       (c) purchase of the ticket only permitted on the day prior to departure of outbound travel; reservation
                             to be made separately for both the outbound and inbound journeys and only in the country of
                             departure on the day prior to travel on the respective journeys;
                       (d) passenger to be aged not more than 25 years or not less than 60 years;
                 — or, if off-peak (as defined in the Appendix), conditions 1 (a) and (b) together with:
                       — either condition 2 (b) and one of the following conditions:
                             (e) passenger to be aged not more than 25 years or not less than 60 years ;
                             (f) father and / or mother with children aged not more than 25 years travelling together (minimum
                                 three persons);
                             (g) six or more persons travelling together with cross-referenced tickets;
                                 or
                             (h) mandatory advance purchase of nor fewer than 28 days; reservation for the entire trip, ticketing
                                 and payment to be made at the same time; cancellation or change of reservation only
                                 available :
                                 — if more than 28 days before outbound travel , at a fee of at least 20 % of the price of the
                                     ticket , or
                                 — if fewer than 28 days before outbound travel, at a fee of at least 50 % of the price of the
                                     ticket .
 ---pagebreak---                                              Official Journal of the European Communities                                         31 . 12 . 87
No L 374 / 18
                                                                   Appendix
                                                            Definition of 'off-peak'
             An air carrier may designate certain flights as 'off-peak' on the basis of commercial considerations.
             When an air carrier wishes to use condition 1 (d) or any of conditions 2 (e) to (h ), identification of the off-peak
             flights for each route shall be agreed between the aeronautical authorities of the Member States concerned on
             the basis of the proposal made by that air carrier.
             On each route where the total activity of third- and fourth-freedom air carriers reaches a weekly average of
              18 return flights, the air carrier concerned shall be allowed as a minimum to apply conditions 1 (d) or 2 (e) to
             (h) on up to 50 % of its total daily flights, provided that the flights to which these conditions may be applied
             depart between 10.00 and 16.00 or between 21.00 and 06.00 .