The Commission has published a report on the application of Council Directive 96/67/EC on access to the ground handling market at Community airports.

In 2002, following a Commission request, a study on “the quality and efficiency of ground handling services at EU airports as a result of the implementation of Council Directive 96/67/EC” was carried out. Based on the results of this study, the Commission finds that the Directive has led to:

a) increased competition at many airports, which previously were either closed or static markets;

b) better value for money spent on ground handling services;

c) greater pressure on the prices for ground handling services;

d) dilatory actions in some instances on the part of competent authorities when fully applying the Directive;

e) some impact on employment conditions but no evidence of an overall reduction of jobs; and

f) a modest shake-up in market shares in ground handling services amongst some of the EU’s most important economic airports.

In March 2003 the Commission services published a Consultation paper on issues regarding a possible revision of the Directive. Member States, the accession countries and interested parties all added extensively to the consultation process. Those with a stake in the air transport industry recognise that there is room for improvement and have therefore called for greater simplification of current provisions. They also call for a clarification of the Directive’s scope.

Following on from this report, the consultation process as well as taking account of Parliament’s views on this matter, the Commission intends to examine, not only ways in which to simplify and clarify the Directive but also ways in which to open up the market further. It also intends to examine the possibility of regulating certain issues, which have come to the forefront in ground handling services since the application of the current Directive. Such issues concern: the definition of insurance requirements; quality standards applicable at an airport; and an improved procedure for the selection of service suppliers.

The Council adopted the Directive.

The rapporteur, Mr SEAL (PSE, UK), expressed his disappointment in having to recommend the rejection of the common position. In his opinion, passengers should have a wider choice of services available to them and, furthermore, this opportunity should be compatible with safety standards; it was for this reason that he was opposed to any form of free ‘deregulation’. He considered the Council’s proposal to be inadequate and incomplete and was moreover indignant at the Council’s strategy, which had rejected any informal meeting. Commissioner Kinnock took the view that groundhandling services, an area in which national companies often held a monopoly, were not in keeping with the standards currently in force. It was the Commission’s aim to ensure that carriers were able to choose their suppliers. In responding to the fears that had been expressed concerning the loss of jobs, the Commissioner thought that the exemptions provided would allow the market to adapt gradually to the new arrangements. He also declared that the Commission could accept Amendments Nos 27, 31, 34, 37, 38, 40, 42, 43 and 45 in full and was prepared to accept, either in part or with modifications, Amendments Nos 1, 7 to 9, 11, 15, 17, 20, 21, 30, 33, 36 and 39. However, it would reject Amendments Nos 2 to 6, 10, 12, 13, 14, 16, 18, 19, 22 to 26, 28, 29, 32, 35, 41 and 44, as they restricted or failed to comply with the aims of the Directive.

The following concrete proposals could be put forward in terms of amendments to be made to the Commission proposal: - the scope of the directive should apply to airports situated within the territory of the Community that were open to commercial air traffic and that registered at least one million passenger movements or 25 000 tonnes of freight. Articles 4, 5, 6, 10, 11 and 12 should not apply to those airports registering at least 4.5 million passenger movements or 150 000 tonnes of freight (Article 2). - There was a need to set up a users’ committee with the necessary powers of remit, which would also include representatives of the regions. The users’ committee would act in a consultative and supporting role (Article 5). - It should be left up to Member States to decide whether or not they wished to limit the number of service providers offering certain stopover services, this applying both to groundhandling for third parties as well as to self-handling (Articles 6 and 7). - Decisions taken under Article 8, relating to exemptions, should be left to Member States. The Commission should only be allowed to verify or correct national decisions in those cases involving airports that were not fully coordinated under the terms of Regulation (EEC) No 95/93 relating to joint arrangements for the allocation of time slots at Community airports. Member states should be given the opportunity to refuse groundhandling for third parties as well as self-handling services. - As regards the shared use of general airport infrastructures by service providers and users wishing to self-handle, the airport operator should be entitled to an appropriate remuneration in the form of an infrastructure tax or leasing tax for the exploitation of an established commercial opportunity. - In order to take the necessary measures to ensure the free exercise of groundhandling by third parties and self-handling, a transition period of three years would be required after the entry into force of the directive (Articles 6, 7 and 14). - As well as deregulating airport stopover services, urgent action was required in order to align security standards and achieve greater social harmonisation. An appropriate degree of social harmonisation was essential in order to ensure a high level of security in the European air transport sector.

The rapporteur considered that the draft Directive on this issue was incomplete. On the one hand, it did not distinguish between public and private airports; on the other hand, it did not give any consideration to the social consequences of the liberalisation of air traffic. Mr SEAL did not wish to see complete deregulation, which would lead to a poorer service, as in the United Kingdom. Instead he was in favour of a controlled system of competition, which made it possible to safeguard jobs. He also proposed that a committee of users’ representatives be set up and be involved in decision-making at airports. As regards the scope of the Directive, Mr SEAL felt that it should apply to airports with traffic of 4.5 million passengers a year and that it should be tested in larger airports before being applied in smaller airports. According to Commissioner KINNOCK, the groundhandling market should be opened up to allow air carriers to obtain services at a reasonable price. He pointed out that all interests had to be taken into consideration, particularly those of airports and travellers. He also stressed that a transitional period would be required for the liberalisation of groundhandling services in order to avoid any negative social upheaval. He therefore approved the idea of setting limits on the number of service providers with a view to ensuring a fair approach to the liberalisation of groundhandling services. The Commission could take over Amendments Nos 1 and 2, which bolstered the social aspects, Amendment No 14 on safety, Amendment No 22, which determined the number of people authorised to self-handle, and Amendment No 33 on the date for application of the Directive by the Member States. It also took over in part the following amendments: Amendments Nos 20 and 21 on the committee of users’ representatives and on cleaning services and the transport of passengers, baggage and freight on the ramp, Amendment No 23 on the operational management of central infrastructures, and Amendments Nos 24, 27 and 28, which improved the original text. Other amendments were taken over in principle: Amendments Nos 2, 5, 34 and 35, which related to the social aspects, Amendment No 11 on transparency and Amendments Nos 16, 17, 26 and 29, which clarified the text. Others would have to be reworded: Amendments Nos 40, 41, 42, 50 and 51. However, the Commission could not take over Amendments Nos 3, 6, 7, 8, 9, 10, 13 and 15 (as they gave Member States rather than the Commission the power to suspend the rights of suppliers and users), and 19, 25, 30, 31, 32, 36, 43, 44, 46 and 48. Similarly, Amendments Nos 37, 39, 45, 47 and 49, which established the threshold of 4.5 million passengers per year for application of the Directive, could not be taken over as the number of airports concerned in the EU would be reduced from 50 to 30, which would result in an imbalance. However, the Commissioner could accept the figure of 2 million so that the Directive could be applied to the smaller airports.

The Council held a detailed policy debate on the proposal for a directive on access to the groundhandling market at Community airports. The proposal, which follows on from the Council Resolution of 24 October 1994 on the state of civil aviation in Europe , aims to liberalise groundhandling services at Community airports and sets out detailed rules. Ministers examined certain key aspects of the proposal and hoped to agree a common position at the Transport Council meeting in December, as soon as the European Parliament has delivered its opinion. The Permanent Representatives Committee will continue to examine the proposal.

The ESC welcomed in principle the Commission’s efforts to ensure rapid, functional handling at Community airports. However, it drew attention to: - the need to make a technical distinction between the land side and the air side, where the individual areas of activity should be listed in detail; - the fact that the proposal lacked clear definitions in many respects. Initially it would be necessary to establish business transparency before contemplating any further measures; - the danger that safety, environmental and employment concerns were not heeded, with users’ and passengers’ interests suffering as a result. With regard to security, the ESC felt that it would be necessary to make a detailed analysis of the effects on safety and security and ensure that the validity of national security provisions was binding. It also criticised the proposal’s complete failure to consider the social consequences. In its comments on the articles of the directive, the ESC stated that it was important to: - reconsider the scope of the proposal by closely scrutinising the practical operations at airports; - ensure that all airport companies and other providers of groundhandling services were obliged to unbundle their accounting and management; - provide further details on the establishment and operation of the Users’ Committee. The ESC thought that the exemption criteria should be very precise and legally binding so that Member States really were in a position to grant exemptions and that provision should be made for consultation between the Commission and the Member States concerned prior to initiating action before the Court of Justice. Finally, in view of the wealth of unanswered questions and objections to the Commission’s approach, implementation of the directive by July 1996 in the interests of all parties did not make much sense. This was also true, in particular, of the Commission’s basic idea that the proposal ought to improve economic efficiency.

The Council held an initial discussion on the proposal for a directive on access to the groundhandling market at Community airports, on the conclusion of which: - it stressed the importance of this proposal, which aimed at the liberalisation of the groundhandling market, to the competitiveness of European carriers; - it invited the Permanent Representatives Committee to report back to it with a view to the adoption of a common position at a forthcoming meeting.