By Daniel Chigundu
AIRLINES for Europe (A4E) and the International Air Transport Association (IATA) have filed a joint complaint to the Directorate General for Competition (DG COMP) of the European Commission in a bid to ensure Portugal lowers airport charges.
Portugal has a 50-year concession agreement with ANA granted in 2012. Under the agreement, ANA operates 10 airports in Portugal and set airport charges at Lisbon according to a pre-determined formula rather than in accordance with its costs.
As a result, airlines operating at Lisbon airport and their passengers have been paying at least 30% higher fees than necessary, which have increased travel costs for passengers and damaged Portugal’s economic competitiveness.
The formula contained in the concession agreement is at odds with a key principle established by the UN International Civil Aviation Organization that airport charges should be related to the cost of providing those services.
A4E and IATA are of the view that the Portuguese government must intervene and re-negotiate the terms of the concession, to ensure a fairer deal for passengers.
“The poor decisions of the previous government under the Troika mandate regarding the airport concession means passengers and airlines are in danger of paying inflated airport charges, damaging the competitiveness of the economy. But the good news is that we believe there are grounds to scrap the agreement and start again.
“Our legal complaint seeks to clarify the situation and does not impact our desire to work with the Portuguese government to rectify the situation. We believe that there is an opportunity to ensure that passengers and airlines using Portuguese airports get a fair deal,” said Rafael Schvartzman, IATA’s Regional Vice President, Europe.
Commenting on the same issues A4E managing director Thomas Reynaert said “other European governments and regulators should be alerted to the risks associated with pre-determined airport concession agreements, which help airports and their shareholders increase their profitability while making a true consultation process on charges, investments and the role of the regulator redundant.
“Eventually, such concession agreements can prevent airlines from obtaining a proper and fair deal on airport charges – and ultimately, a fair deal for the passenger,”
This is not the first time that airlines have sought EU intervention over rising airport charges in Portugal.
IATA and other airline associations have complained to the European Commission about the fact that Portugal is not compliant with the European Airport Charges Directive, which sets minimum rules for the setting of airport charges.