Sunday 25 August 2019

EU presses for reduction in air traffic control fees

The European Union has decided to press air traffic control companies to reduce charges on airlines, seeking relief for an industry that faces a demand slump and new pollution limits.

The European Parliament approved legislation that will lead to performance requirements for air-navigation service providers in the 27-nation EU. The goal is to prevent overcharging and spur cross-border mergers by breaking down national barriers.

"This will have direct and positive implications," said Marian-Jean Marinescu, a Romanian member who steered the legislation through the 785-seat assembly.

EU governments have already signalled support for the law under a fast-track accord with the parliament, making their final approval a formality in the coming weeks.

The EU is mounting a fresh push to force down air-traffic charges of about €7bn a year in Europe. On a per-flight basis, that's around double the rate in the US, where controllers handle twice as many flights. Airlines are demanding an end to the fragmentation of Europe's airspace as the recession wipes out revenue and the EU prepares to raise costs on the industry by capping carrier emissions tied to climate change as of 2012.

The legislation establishes a framework for imposing binding performance targets on air-navigation companies such as the UK's NATS Holdings Ltd, Deutsche Flugsicherung GmbH of Germany and France's DSNA.

The European Commission, which proposed the law last year, will now draw up specific requirements, such as cutting costs and reducing flight distances by certain percentages. The commission will have the right to push those rules through an EU regulatory committee.

To complement this, the new law also tightens requirements under existing EU legislation for groups of European nations to merge their airspace. The legislation imposes a 2012 deadline for countries to use such "functional airspace blocks," or FABs.

Among the FABs under development are UK-Ireland, Poland-Lithuania, Denmark-Sweden and a central European group that includes Germany, France, the Benelux states and Switzerland.

Law

The new law reflects impatience with vested national interests and a lack of competition, which are undermining the push for a more integrated aviation system in Europe. Indirect flight routes and surplus civil control centres in Europe cost carriers about €3bn a year, according to the European Organisation for the Safety of Air Navigation.

The package could allow airlines to cut annual costs by at least €2bn through lower fuel consumption, the commission says.

The efficiency gains, including carbon dioxide emission reductions, could be as much as 10pc per flight, according to the regulator. (Bloomberg)

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