Ryanair to begin legal battle on airport charges directive
Friday November 20 2009
Ryanair will next week seek leave for a judicial review of a direction issued by the Minister for Transport to the Commissioner for Aviation Regulation, allowing Dublin Airport Authority (DAA) to increase passengers fees to a level which will enable it to claw back millions of euro it spent on Terminal 2.
Branding the Department of Transport as "corrupt" yesterday, Ryanair chief executive Michael O'Leary said the airline's legal team had informed him that they believed the group had a "good legal case" to make.
But he was unable to immediately clarify on what grounds the airline would be appealing Transport Minister Noel Dempsey's direction.
The department lashed out at Mr O'Leary's corruption allegation, saying it "fundamentally rejected" the characterisation.
Mr Dempsey wrote to Aviation Regulator Cathal Guiomard last month under the terms of a section of the Aviation Regulation Act that permits him to give general policy directions to the regulator's office.
Mr Dempsey told Mr Guiomard in the letter that he must ensure the DAA's "financial viability is protected in order to implement government policy" on a number of issues, including the role of Dublin Airport in the economy and ensuring it can operate without requiring any cash injection from the Government.
Surprised
It is believed that the regulator's office was somewhat surprised at the explicit nature of the minister's direction. The regulator's office is ostensibly an independent body, funded by the taxpayer.
Mr Guiomard is expected to deliver a ruling the week after next on how much the DAA will be allowed to charge passengers for a five-year period up to 2014.
Earlier this year, Mr Guiomard made draft determination that the fee would rise to a maximum of €8.35 from the current €7.39, but the DAA has sought an increase that would bring that to in excess of €10 once additional costs for the second terminal, T2, are eventually factored in.
Airlines and the DAA can appeal the final determination of the regulator.
Mr O'Leary claimed yesterday that the Department of Transport was protecting the DAA, describing the airport authority as "inefficient" and "wasteful". He said the regulator's office should be disbanded.
A DAA spokesman disputed Mr O'Leary's claims that T2 cost €1.3bn, pointing out that the figure included the entire current capital expenditure programme at Dublin Airport, which included the new terminal and additions to the existing terminal. The spokesman said that the total cost of Terminal 2 was €609m.
The Department of Transport said yesterday that it accepted Ryanair's right to disagree with government policies, but assailed his corruption allegation.
"We fundamentally reject Mr O'Leary's characterisation of the department and its officials as corrupt, by virtue of their implementation of these policies," it said in a statement. "We will not lend dignity to the accusation by making any further comment on it."
- John Mulligan
Irish Independent
