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Procedure : 2006/0130(COD)
Document stages in plenary
Document selected : A6-0178/2007

Texts tabled :

A6-0178/2007

Debates :

PV 10/07/2007 - 19
CRE 10/07/2007 - 19

Votes :

PV 11/07/2007 - 7.11
CRE 11/07/2007 - 7.11
Explanations of votes

Texts adopted :

P6_TA(2007)0337

Texts adopted
PDF 534kWORD 349k
Wednesday, 11 July 2007 - Strasbourg
Common rules for air transport services ***I
P6_TA(2007)0337A6-0178/2007
Resolution
 Consolidated text

European Parliament legislative resolution of 11 July 2007 on the proposal for a regulation of the European Parliament and of the Council on common rules for the operation of air transport services in the Community (recast) (COM(2006)0396 – C6-0248/2006 – 2006/0130(COD))

(Codecision procedure: first reading)

The European Parliament,

–   having regard to the Commission proposal to the European Parliament and the Council (COM(2006)0396)(1),

–   having regard to Article 251(2) and Article 80(2) of the EC Treaty, pursuant to which the Commission submitted the proposal to Parliament (C6-0248/2006),

–   having regard to Rule 51 of its Rules of Procedure,

–   having regard to the report of the Committee on Transport and Tourism (A6-0178/2007),

1.  Approves the Commission proposal as amended;

2.  Calls on the Commission to refer the matter to Parliament again if it intends to amend the proposal substantially or replace it with another text;

3.  Requests the Commission to bring forward a legislative proposal to the European Parliament and the Council relating to the social and working conditions in the European aviation sector and, meanwhile, until the entry into force of such legislation, requests the air carriers to observe the rules on posting where their employees are concerned.

4.  Instructs its President to forward its position to the Council and Commission.

(1) Not yet published in OJ.


Position of the European Parliament adopted at first reading on 11 July 2007 with a view to the adoption of Regulation (EC) No .../2007 of the European Parliament and of the Council on common rules for the operation of air transport services in the Community (recast)
P6_TC1-COD(2006)0130

(Text with EEA relevance)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Article 80(2) thereof,

Having regard to the proposal from the Commission║,

Having regard to the opinion of the European Economic and Social Committee(1),

Having regard to the opinion of the Committee of the Regions(2),

Acting in accordance with the procedure laid down in Article 251 of the Treaty(3),

Whereas:

(1)  A number of substantial changes are to be made to Council Regulations (EEC) No 2407/92 of 23 July 1992 on licensing of air carriers(4), (EEC) No 2408/92 of 23 July 1992 on access of Community air carriers to intra-Community air routes(5) and (EEC) No 2409/92 of 23 July 1992 on fares and rates for air services(6). In the interests of clarity, these Regulations should be recast and consolidated into one single Regulation.

(2)  Through the adoption of those three Regulations air transport in the Community was liberalised. Despite the success of that liberalisation in terms of growth, competition and lower fares, the inconsistent application of those Regulations across the Member States distorts the functioning of the internal aviation market.

(3)  In order to ensure a more efficient and consistent application of Community legislation for the internal aviation market, a series of adjustments to the current legal framework are required.

(4)  Recognising the potential link between the financial health of an air carrier and safety, ║ more stringent monitoring of the financial situation of ║ air carriers should be established.

(5)  Given the growing importance of air carriers with operational bases in several Member States and the need to ensure the efficient supervision of these air carriers, the same Member State should be responsible for overseeing activities carried out pursuant to the AOC (Air Operator's Certificate) and the operating licence.

(6)  In order to ensure the consistent monitoring of ║ compliance with the requirements of the operating licences of all Community air carriers, licensing authorities should carry out regular assessments of the air carriers" financial situation. Therefore, the latter should provide sufficient information on their financial situation, especially in the first two years of their existence as these are particularly critical for the survival of an air carrier on the market. In order to avoid a distortion of competition arising from the application of different rules at national level, it is necessary to ensure transparency and to submit the financial situation of all Community air carriers to the joint control of the Commission and Member States.

(7)  In order to reduce risks to passengers, Community air carriers that fail║ to fulfil the requirements for maintaining a valid operating licence should not be allowed to continue operations. In such cases, the competent licensing authority should revoke or suspend the operating licence. In cases where the competent licensing authority fails to do so, the Commission should be allowed to revoke or suspend the operating licence in order to ensure the homogeneous application of Community legislation.

(8)  In order to avoid ║ excessive recourse to lease agreements of aircraft registered in third countries, especially with crew (wet lease), such a possibility should only be allowed in exceptional circumstances, such as a lack of adequate aircraft on the Community market, be strictly limited in time and fulfil safety standards equivalent to the safety rules of Community legislation.

(9)  With respect to employees of a Community air carrier operating air services from an operational base outside the territory of the Member State where that Community air carrier has its principal place of business, Member States should ensure the proper application of Community and national legislation in the social field.

(10)  In order to ensure the safe and coherent functioning of the internal aviation market, it is desirable that the Community be responsible for negotiating intra-Community traffic rights with third countries. This would avoid possible inconsistencies between the internal market and individual negotiations by Member States.

(11)  In order to complete the internal aviation market ║ existing restrictions applied between Member States, such as restrictions on ║ code sharing on routes to third countries or on ║ price setting on routes to third countries with an intermediate stop in another Member State (6th freedom flights), should be lifted.

(12)  The conditions under which public service obligations may be imposed should be defined clearly and in an unambiguous way, while the associated tender procedures should allow a sufficient number of competitors to take part║. The Commission should be able to obtain as much information as is necessary in order to be able to assess the economic justifications for public service obligations in individual cases.

(13)  The rules in force with regard to traffic distribution between airports serving a same city or conurbation should be clarified and simplified.

(14)  It is appropriate to ensure that Member States have the possibility to react to sudden problems resulting from unforeseeable and unavoidable circumstances, which make it technically or practically very difficult to carry out air services.

(15)  Passengers should have access to the same tariffs for the same flights irrespective of their place of residence within the Community or their nationality and irrespective of the place of establishment of the travel agents within the Community.

(16)  Passengers should be able to effectively compare tariffs between airlines. Therefore, published tariffs should indicate the final price to be paid by the passenger, inclusive of all taxes, charges and fees.

(17)  The measures necessary for the implementation of this regulation should be adopted in accordance with Council Decision 1999/468/EC of 28 June 1999 laying down the procedures for the exercise of implementing powers conferred on the Commission(7).

(18)  Since a more homogeneous application of ║ Community legislation with regard to the internal aviation market cannot be sufficiently achieved by the Member States because of the international character of air transport, and can therefore be better achieved at Community level, the Community may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty. In accordance with the principle of proportionality, as set out in that Article, this Regulation does not go beyond what is necessary in order to achieve those objectives.

(19)  It is therefore necessary to repeal Regulations (EEC) No 2407/92, 2408/92 and 2409/92,

HAVE ADOPTED THIS REGULATION:

Chapter I

General provisions

Article 1

Subject matter

1.  This Regulation regulates the licensing of Community air carriers, the right of Community air carriers to operate air services within the Community, and the pricing of air services operated within the Community. Provisions on information and non-discrimination in pricing shall apply to flights departing from an airport situated in the territory of a Member State and to flights contracted by a Community air carrier departing from an airport located in a third country to an airport situated in the territory of a Member State, unless air carriers are subject to the same obligations in that third country.

2.  The application of Chapter III of this Regulation to the airport of Gibraltar is understood to be without prejudice to the respective legal positions of the Kingdom of Spain and the United Kingdom with regard to the dispute over sovereignty over the territory in which the airport is situated.

3.  Application of the provisions of Chapter III of this Regulation to Gibraltar airport shall be suspended until the arrangements in the joint declaration made by the Foreign ministers of the Kingdom of Spain and the United Kingdom on 2 December 1987 have come into operation. The Governments of Spain and the United Kingdom will so inform the Council on that date.

Article 2

Definitions

For the purposes of this Regulation, the following definitions shall apply:

   1) "operating licence' means an authorisation granted by the competent licensing authority to an undertaking, permitting it to carry by air passengers, mail and/or cargo, as stated in the operating licence, for remuneration and/or hire;
   2) "competent licensing authority" means an authority ║ entitled to grant, refuse, revoke or suspend an operating licence in accordance with Chapter II;
   3) "undertaking' means any natural  or  legal person, whether profit-making or not, or any official body whether it has its own legal personality or not;
   4) "air service' means a flight or a series of flights carrying passengers, cargo and/or mail for remuneration and/or hire;
   5) "flight' means a departure from a specified airport towards a specified destination airport;
   6) "airport' means any area in a Member State which is open for commercial air transport operations;
   7) "air operator's certificate (AOC)' means a certificate issued to an undertaking affirming that the operator in question has the professional ability and organisation to secure the safe operation of aircraft for the aviation activities specified in the certificate, as provided in the relevant provisions of Community law;
  8) "effective control' means a relationship constituted by rights, contracts or any other means which, either separately or jointly and having regard to the considerations of fact or law involved, confer the possibility of directly or indirectly exercising a decisive influence on an undertaking, in particular by:
   a) the right to use all or part of the assets of an undertaking;
   b) rights or contracts which confer a decisive influence on the composition, voting or decisions of the bodies of an undertaking or otherwise confer a decisive influence on the running of the business of the undertaking;
   9) "air carrier' means an air transport undertaking with a valid operating licence;
   10) "Community air carrier' means an air carrier with a valid operating licence granted by a competent licensing authority in accordance with Chapter II;
   11) "business plan' means a detailed description of the air carrier's intended commercial activities for the period in question, in particular in relation to the expected market development and the investments to be carried out, including the financial and economic implications of these activities;
   (12) "Intra-Community air service" means an air service operated within the Community;
   (13) "Transit" means the right to fly across the territory of the Community or of a third country without landing and to land for non-traffic purposes;
   14) "traffic right' means the right to operate an air service between two Community airports;
  

   15) "seat-only sales" means the sale of seats, without any other service bundled, such as accommodation, directly to the public by the air carrier or its authorised agent or a charterer;
  16) 'scheduled air service' means a series of flights possessing all the following characteristics:
   a) it is performed by aircraft for the transport of passengers, cargo and/or mail for remuneration, in such a manner that on each flight seats are available for individual purchase by the public (either directly from the air carrier or from its authorised agents);
  b) it is operated so as to serve traffic between the same two or more airports, either:
   according to a published timetable; or
   with flights so regular or frequent that they constitute a recognisably systematic series;
   17) "capacity" means the number of seats offered to the general public on a scheduled air service over a given period;
   18) 'air fares' means the prices expressed in euros or in local currency to be paid by passengers to air carriers or their agents for the carriage of those passengers and ║ their baggage on air services and any conditions under which those prices apply, including remuneration and conditions offered to agencies, and other auxiliary services █;
   19) "air rates" means the prices expressed in euros or in local currency to be paid for the carriage of cargo and the conditions under which those prices apply, including remuneration and conditions offered to agencies, and other auxiliary services █;

20)   'Member State(s) concerned' means the Member State(s) between or within which an air service is operated;

21)   'Member State(s) involved' means the Member State(s) concerned and the Member State(s) where the air carrier(s) operating the air service is (are) licensed;

   (22) "Conurbation" means an urban area comprising a number of cities or towns which, through population growth and expansion, have physically merged to form one continuous built up area;
   23) 'management account' means a detailed statement of income and costs of an air carrier  for the period in question including a breakdown between air-transport-related and other activities as well as between pecuniary and non-pecuniary elements;
   24) "dry lease agreement' means an agreement between air carriers pursuant to which an aircraft is operated under the AOC of the lessee;
   25) "wet lease agreement' means an agreement between air carriers pursuant to which an aircraft is operated under the AOC of the lessor;
   26) "principal place of business" means the place of the head office and, if any, the registered office of a Community air carrier in a Member State within, to or from which the Community air carrier carries out a significant part of its operational activities.

Chapter II

Operating licence

Article 3

Operating licence

1.  No undertaking established in the Community shall be permitted to carry by air passengers, mail and/or cargo for remuneration and/or hire within the Community unless it has been granted the appropriate operating licence.

An undertaking meeting the requirements of this Chapter shall be entitled to receive an operating licence.

2.  The competent licensing authority shall not grant operating licences where any of the requirements of this Chapter are not complied with.

3.  Without prejudice to any other applicable provisions of Community, national, or international law the following categories of air services are not subject to the requirement to hold a valid operating licence:

   a) air services performed by non-power driven aircraft and/or ultralight power driven aircraft, and
   b) local flights not involving the carriage of passengers, mail and/or cargo between different airports.

Article 4

Conditions for granting an operating licence

An undertaking shall be granted an operating licence by the competent licensing authority provided that:

   a) its principal place of business is located in the Community and it operates the largest part of its air services within, to or from the Community;
   b) it holds a valid AOC; 
   c) where the licence is applied for to the authority of a Member State, its principal place of business is located in that Member State █;
   d) it has one or more aircraft at its disposal as a result of ownership or a dry lease agreement;
   e) its main occupation is to operate air services in isolation or combined with any other commercial operation of aircraft or the repair and maintenance of aircraft;
   f) its company structure allows the competent licensing authority to implement the provisions of this Chapter;
   (g) Member States and/or nationals of Member States own more than 50 per cent of the undertaking and effectively control it, whether directly or indirectly through one or more intermediate undertakings, unless otherwise provided for in an agreement with a third country to which the Community is a party;
   h) it meets the financial conditions specified in Article 5;
   i) it complies with the insurance requirements specified in Article 11;
   j) it provides evidence that it has sufficient insurance cover to be able to refund sums paid and to cover the costs of repatriating passengers in the event of it being unable to operate booked flights because of insolvency or revocation of its operating licence.

Article 5

Financial conditions for granting an operating licence

1.  The competent licensing authority shall closely assess whether an undertaking applying for the first time for an operating licence can demonstrate that:

   a) it can meet at any time its actual and potential obligations established under realistic assumptions, for a period of 36 months from the start of operations;
   b) it can meet its fixed and operational costs incurred by operations according to its business plan and established under realistic assumptions, for a period of three months from the start of operations, without taking into account any income from its operations; and
   c) its net capital is at least EUR 100 000.

2.  For the purpose of paragraph 1, each applicant shall submit a business plan for, at least, the first three years of its operation. The business plan shall also detail the applicant's financial links with any other commercial activities in which the applicant is engaged either directly or through related undertakings. The applicant shall also provide all relevant information; in particular the data referred to in point 1 of Annex I. Each applicant shall establish provisions to avoid or mitigate the negative social consequences of insolvency.

3.  Paragraphs 1 and 2 shall not apply to air carriers exclusively engaged in operations with aircraft of less than 10 tonnes MTOW (Maximum Take Off Weight) and/or less than 20 seats. Such air carriers shall at all times be able to demonstrate that their net capital is at least EUR 100 000 or to provide when required by the competent licensing authority the information relevant for the purposes of article 9(2).

A Member State may nevertheless apply paragraphs 1 and 2 to air carriers licensed by it that operate scheduled services or whose turnover exceeds EUR 3 million per year.

Article 6

Air operator's certificate 

1.  The granting and validity at any time of an operating licence shall be dependent upon the possession of a valid AOC specifying the activities covered by the operating licence and complying with the criteria established under relevant Community law.

2.  Any modification in the AOC of a Community air carrier shall be reflected, where appropriate, in its operating licence.

3.  Where the AOC is granted by a national authority, the competent authorities of that Member State shall be responsible for granting, refusing, revoking or suspending the AOC and the operating licence of a Community air carrier.

Article 7

Proof of good repute 

1.  Where, for the purpose of issuing an operating licence, proof is required that the persons who will continuously and effectively manage the operations of the undertaking are of good repute or that they have not been declared bankrupt, or for the purpose of suspending or revoking the operating licence in the event of serious professional misconduct or a criminal offence, the competent licensing authority shall accept as sufficient evidence in respect of nationals of Member States the production of documents issued by the competent authorities in the Member State of origin or the Member State where the person has his/her permanent residence showing that those requirements are met.

2.  Where the Member State of origin or the Member State where the person has his/her permanent residence does not issue the documents referred to in paragraph 1, such documents shall be replaced by a declaration on oath - or, in Member States where there is no provision for declaration on oath - by a solemn declaration made by the person concerned before a competent judicial or administrative authority or, where appropriate, a notary or qualified professional body of the Member State of origin or the Member State where the person has his/her permanent residence; such authority, notary or qualified professional body shall issue a certificate attesting the authenticity of the declaration on oath or solemn declaration.

3.  The competent licensing authority may require that the documents and certificates referred to in paragraphs 1 and 2 be presented no more than three months after their date of issue.

Article 8

Validity of an operating licence

1.  An operating licence shall be valid as long as the Community air carrier complies with the requirements of this Chapter.

A Community air carrier shall at all times be able on request to demonstrate to the competent licensing authority that it meets all the requirements of this Chapter.

2.  The competent licensing authority shall closely monitor ║ compliance with the requirements of this chapter. It shall in any case review ║ compliance with these requirements in the following cases:

   a) two years after a new operating licence has been granted, or
   b) when a potential problem has been suspected, or
   c) at the request of the Commission.

In the event that a competent licensing authority suspects that the financial problems of a Community air carrier might affect the safety of its operations, it will immediately inform the authority responsible for issuing the AOC.

3.  The operating licence shall be resubmitted for approval when a Community air carrier:

   a) has not started operations within six months of the grant of an operating licence,
   b) has ceased its operations for more than six months.

4.  A Community air carrier shall provide ║ the competent licensing authority every financial year with ║ audited accounts relating to the previous financial year within six months of the accounts closing date. During the first two years of operation of a Community air carrier, the data, as referred to in point 3 of Annex I, shall be updated and made available to the competent licensing authority on a six monthly basis.

The competent licensing authority may at any time assess the financial performance of a Community air carrier to which it has granted an operating licence by requesting the relevant information and, in particular, the data referred to in point 3 of Annex I. 

5.  A Community air carrier shall notify the competent licensing authority:

   a) in advance of any plans to operate new scheduled services or non-scheduled services to a continent or a world region not previously served, change the type or number of aircraft used or to substantially change the scale of its activities;
   b) in advance of any intended mergers or acquisitions, and
   c) within fourteen days of any change in the ownership of any single shareholding which represents 10% or more of the total shareholding of the Community air carrier or of its parent or ultimate holding company.

6.  If the competent licensing authority deems the changes notified under paragraph 5 to have a significant bearing on the finances of the Community air carrier, it shall require the submission of a revised business plan incorporating the changes in question and covering, at least, a period of 12 months from its date of implementation as well as the data referred to in point 2 of Annex I, in addition to the information to be provided under paragraph 4.

The competent licensing authority shall take a decision on the revised business plan not later than three months after all the necessary information has been submitted to it.

7.  In relation to Community air carriers licensed by it, the competent licensing authority shall decide whether the operating licence is to be resubmitted for approval in the event of change in one or more elements affecting the legal situation of the Community air carriers and, in particular, in the event of a merger or takeover.

8.  Paragraphs 4, 5 and 6 shall not apply to air carriers exclusively engaged in operations with aircraft of less than 10 tonnes MTOW (Maximum Take Off Weight) and/or less than 20 seats. Such air carriers shall at all times be able to demonstrate that their net capital is at least EUR 100 000 or to provide when required by the competent licensing authority the information relevant for the purposes of Article 9(2). 

A Member State may nevertheless apply paragraphs 4, 5 and 6 to air carriers licensed by it that operate scheduled services or whose turnover exceeds EUR 3 million per year.

Article 9

Suspension and revocation of an operating licence

1.  The competent licensing authority shall suspend or revoke the operating licence if there are reasonable grounds for suspecting that the Community air carrier cannot meet its actual and potential obligations for a 12-month period.

The competent licensing authority may grant a temporary licence, not exceeding 12 months, pending financial reorganisation of the Community air carrier provided that safety is not at risk, that this temporary licence reflects any changes to the AOC and that there is a realistic prospect of a satisfactory financial reconstruction within that time period.

2.  Whenever there are clear indications that financial problems exist, or when insolvency or similar proceedings are opened against a Community air carrier licensed by it, the competent licensing authority shall without delay carry out an in depth assessment of the financial situation and, on the basis of its findings, review the status of the operating licence in compliance with this article within a time period of three months.

The competent licensing authority shall inform the Commission of the assessment procedure and of its findings, as well as of the decision it takes relating to the status of the operating licence.

3.  When the audited accounts referred to in Article 8(4) have not been communicated within six months following the accounts closing date of the previous financial year, the competent licensing authority shall request the Community air carrier to communicate these audited accounts without delay.

If the audited accounts are not communicated within one month, the operating licence shall be revoked or suspended.

The competent licensing authority shall inform the Commission of the failure of the Community air carrier to communicate its audited accounts within the six month time limit and of the subsequent action it takes. 

4.  In the event that a Community air carrier's AOC is suspended or withdrawn, the competent licensing authority shall immediately suspend or revoke that air carrier's operating licence.

Article 10

Decisions on operating licences

1.  The competent licensing authority shall take a decision on an application as soon as possible, and not later than three months after all the necessary information has been submitted, taking into account all available evidence. The decision shall be communicated to the applicant. A refusal shall indicate the reasons therefore.

2.  Procedures for granting, suspending and revoking ║ operating licences shall be made public by the competent licensing authorities, which shall inform the Commission thereof.

3.  A list of decisions of the competent licensing authorities to grant, suspend or revoke operating licences shall be published annually in the Official Journal of the European Union.

Article 11

Insurance requirements 

An air carrier shall be insured so as to cover liability in the event of an accident, in particular with respect to passengers, luggage, cargo, mail and third parties. Where applicable, the insurance cover║ shall comply with the minimum requirements provided for in Regulation (EC) No 785/2004 of the European Parliament and of the Council of 21 April 2004 on insurance requirements for air carriers and aircraft operators(8).

Article 12

Registration

1.  Without prejudice to Article 13(2), aircraft used by a Community air carrier shall be registered █within the Community. The Member State whose competent licensing authority is responsible for granting the operating licence of the Community air carrier may require such aircraft to be registered in its national register.

2.  In accordance with paragraph 1, a competent licensing authority shall, subject to applicable laws and regulations, accept on its national register, without any discriminatory fee and without delay, aircraft owned by nationals of other Member States and transfers from aircraft registers of other Member States. No fee shall be applied to transfers of aircraft in addition to the normal registration fee.

Article 13

Leasing

1.  █An undertaking requesting the granting of an operating licence shall have one or more aircraft at its disposal through ownership or lease without crew (dry lease) agreement.

A Community air carrier shall have one or more aircraft at its disposal through ownership or ║ a ║dry lease agreement.

A Community air carrier may have one or more aircraft at its disposal through a ║ wet lease agreement.

2.  In the case of short-term wet lease agreements to meet the temporary needs of a Community air carrier, or otherwise in exceptional circumstances, the competent licensing authority may grant waivers to the requirement of registration provided for in Article 12(1) provided that:

   a) the Community air carrier can justify such leasing on the basis of an exceptional need, in which case a waiver may be granted for a period of up to seven months that may, in exceptional circumstances, be renewed once only for a second period of up to seven months; or
   b) the Community air carrier demonstrates that leasing is necessary to satisfy seasonal capacity needs, which cannot reasonably be satisfied through leasing aircraft registered in accordance with Article 12(1), in which case the waiver may be granted for a period of up to seven months that may be renewed; or
   c) the Community air carrier demonstrates that leasing is necessary to overcome unforeseen operational difficulties, such as technical problems, and it is not reasonable to lease aircraft registered in accordance with Article 12(1), in which case the waiver shall be of a limited duration which is strictly necessary for overcoming the difficulties.
  

█Such waivers shall be subject to the existence of a valid agreement providing for reciprocity as regards wet-leasing between the Member State concerned or the Community and the third country of registration of the leased aircraft.

3.  For the purposes of ensuring safety standards, a Community air carrier using an aircraft from another undertaking or providing it to another undertaking, with or without crew, shall obtain prior approval for the operation from the competent licensing authority. The conditions of the approval shall be part of the lease agreement between the parties.

4.  The competent licensing authority shall not approve wet-leasing or dry-leasing agreements ║ as regards an air carrier to which it has granted an operating licence unless that authority has determined and declared in writing to the air carrier in question that all safety standards equivalent to those imposed in the relevant Community law are met.

Article 14

Examination by the Commission

1.  The Commission acting in accordance with the procedure referred to in Article 28(2) at the request of a Member State, or on its own initiative, shall examine compliance with the requirements of this Chapter and take a decision to suspend or revoke an operating licence if necessary. 

2.  In order to carry out its duties under this Article the Commission may obtain all necessary information from the competent licensing authority or directly from the Community air carrier(s) concerned within a time limit fixed by the Commission.

Article 15

Rights of defence

The competent licensing authority and the Commission shall ensure that, when adopting a decision to suspend or revoke the operating licence of a Community air carrier, the Community air carrier concerned is given the opportunity of being heard, taking into account the need, in some cases, for an urgency procedure.

Article 16

Social legislation

With respect to employees of a Community air carrier operating air services from an operational base outside the territory of the Member State in which that Community air carrier has its principal place of business, Member States shall ensure the proper application of Community and national legislation in the social field.

Chapter III

Access to routes

Article 17

Provision of intra-Community air services 

1.  Community air carriers shall be entitled to exercise traffic rights on routes within the Community.

2.  Member States shall not subject the exercise of traffic rights by a Community air carrier to any permit or authorisation. If a Member State has reasons to doubt ║the validity of an operating licence issued to a Community air carrier, it shall raise the matter with the competent licensing authority. Member States shall not require Community air carriers to provide any documents or information which they have already supplied to the competent licensing authority.

3.  In operating intra-Community air services, a Community air carrier shall be permitted to combine air services, and to enter into code share arrangements, without prejudice to the Community competition rules applicable to undertakings.

4.  Any restrictions on the freedom of Community air carriers to provide intra-Community air services arising from bilateral agreements between Member States are hereby superseded.

5.  Notwithstanding the provisions of bilateral agreements between Member States, and subject to the Community competition rules applicable to undertakings and to the provisions of bilateral agreements between Member States and third countries, Community air carriers shall be permitted by the Member State(s) concerned to combine air services and to enter into code share arrangements with any air carrier on air services to, from or via any airport in their territory from or to any point(s) in third countries.

6.  Without prejudice to any existing rights granted prior to the entry into force of this Regulation, and notwithstanding Regulation (EC) Nr. 847/2004 of the European Parliament and of the Council of 29 April 2004 on the negotiation and implementation of air service agreements between member states and third countries(9), non-Community air carriers shall not be permitted to exercise traffic rights, to combine air services or to enter into code-share arrangements in respect of routes wholly within the Community unless they are permitted to do so by an agreement concluded by the Community with a third country.

7.  Without prejudice to any existing rights granted prior to the entry into force of this Regulation, and notwithstanding Regulation (EC) Nr 847/2004, air carriers of third countries shall not be permitted to transit the territory of the Community unless the third country concerned is a party to the International Air Services Transit Agreement signed at Chicago on 7 December 1944 or has concluded an agreement to that effect with the Community.

Article 18

General principles for public service obligations 

1.  A Member State, following consultations with the other Member States concerned and after having informed the Commission, the airports concerned and air carriers operating on the route, may impose a public service obligation in respect of scheduled air services to an airport in its territory, any such route being considered vital for the economic and social development of the region █which the airport serves. That obligation shall be imposed only to the extent necessary to ensure on that route the minimum provision of scheduled air services satisfying fixed standards of continuity, regularity, pricing or minimum capacity, ║ standards which air carriers would not assume if they were solely considering their commercial interest.

The fixed standards imposed on the route subject to that public service obligation shall be set in a transparent and non-discriminatory way.

2.  In instances where other modes of transport cannot ensure an uninterrupted service with at least two daily operations, the Member States concerned may include in the public service obligation the requirement that any air carrier intending to operate the route gives a guarantee that it will operate the route for a certain period, to be specified, in accordance with the other terms of the public service obligation.

3.  When a public service obligation has been imposed in accordance with paragraphs 1 and 2 ║ air carriers shall be able to offer seat-only sales only if the air service in question meets all the requirements of the public service obligation. Consequently, that air service shall be considered as a scheduled air service.

4.  If no air carrier has commenced or is about to commence scheduled air services on a route in accordance with the public service obligation which has been imposed on that route, the Member State concerned may limit access to the scheduled air services on that route to only one air carrier for a period of up to four years, after which the situation shall be reviewed.

This period may be up to five years if the public service obligation is imposed on a route to an airport serving an ultra-peripheral region, as defined in Article 299(2) of the Treaty. 

5.  The right to operate the services referred to in paragraph 4 shall be offered by public tender in accordance with Article 19, either singly or, in cases where this is indispensable for operational reasons, for a group of such routes to any Community air carrier entitled to operate such air services.

6.  When a Member State wishes to impose a public service obligation, it shall communicate the complete text of the envisaged imposition of the public service obligation to the Commission, to the other Member States concerned, to the airports concerned and to the air carriers operating the route in question.

The Commission shall publish an information notice in the Official Journal of the European Union:

   a) identifying the two airports connected by the route concerned,
   b) mentioning the date of entry into force of the public service obligation, and
   c) indicating the complete address where the text and any relevant information and/or documentation related to the public service obligation shall be made available without delay and free of charge by the Member State concerned. 

7.  The need and ║ adequacy of an envisaged public service obligation shall be assessed by the Member States having regard to:

   a) the proportionality between the envisaged obligation and the economic development needs of the region concerned; 
   b) the possibility of having recourse to other modes of transport and the ability of such modes to meet the transport needs under consideration, in particular when existing rail services serve the envisaged route with a travel time of less than three hours;
   c) the air fares and conditions which can be quoted to users;
   d) the combined effect of all air carriers operating or intending to operate on the route.

8.  The date of entry into force of a public service obligation shall not be earlier than the date of publication of the information notice referred to in the second subparagraph of paragraph 6.

9.  A public service obligation shall be deemed to have expired if no scheduled air service has been operated during a period of more than twelve months in the route subject to such obligation. 

10.  In the event of a sudden interruption in service by the air carrier selected in accordance with Article 19, the Member State concerned may, in the event of an emergency, select by mutual agreement a different air carrier to operate the public service obligation for a period of up to six months, which is not renewable, under the following conditions:

   a) any compensation paid by the Member State shall be made in compliance with Article 19(8);
   b) the selection shall be made among Community air carriers in compliance with the principles of transparency and non-discrimination. 

The Commission and the Member State(s) shall be informed without delay of the emergency procedure and of its reasons. At the request of a Member State(s), or on its own initiative, the Commission may, in accordance with the procedure referred to in Article 28(2), suspend the procedure if it considers that it does not meet the requirements of this paragraph or is otherwise contrary to Community legislation.

Article 19

Public tender procedure for public service obligation

1.  The public tender required by Article 18(5) shall be conducted according to the procedure set out in paragraphs 2 to 11.

2.  The Member State concerned shall communicate the entire text of the invitation to tender to the Commission.

3.  The Commission shall make the invitation to tender known through an information notice published in the Official Journal of the European Union. The deadline for submission of tenders shall not be earlier than two months after the day of publication of such an information notice. In the event that the tender concerns a route to which ║ access had already been limited to one carrier in accordance with Article 18(4), the invitation to tender shall be published at least six months before the start of the new concession in order to enable the continued need for restricted access to be assessed.

4.  The information notice shall provide the following information:

(a)  Member State(s) concerned;

   (b) Air route concerned;
   (c) Period of validity of the contract;
   (d) Complete address at which the text of the invitation to tender and any relevant information and/or documentation related to the public tender and the public service obligation shall be made available by the Member State concerned;
   (e) Deadline for submission of tenders.

5.  The Member State(s) concerned shall communicate without delay and free of charge any relevant information and documents requested by a party interested in the public tender.

6.  The invitation to tender and the subsequent contract shall cover, inter alia, the following points:

   (a) The standards required by the public service obligation;
   (b) Rules concerning the amendment and termination of the contract, in particular to take account of unforeseeable changes;
   (c) The period of validity of the contract;
   (d) Sanctions in the event of failure to comply with the contract;
   (e) Objective and transparent parameters on the basis of which compensation, if any, for the discharge of the public service obligations shall be calculated.

7.  The selection among the submissions shall be made as soon as possible taking into consideration the adequacy of the service, including the prices and conditions which can be quoted to users, and the cost of the compensation required from the Member State(s) concerned, if any.

8.  The Member State concerned may compensate an air carrier, which has been selected under paragraph 7, for adhering to the standards required by a public service obligation imposed under Article 18. Such compensation may not exceed the amount required to cover the net costs incurred in discharging each public service obligation, taking into account revenue relating thereto kept by the air carrier and a reasonable profit.

9.  The Commission shall be informed without delay of the results of the public tender and of the selection through a notice from the Member State including the following information:

   (a) Numbers and names of, and corporate information on, tenderers;
   (b) Operational elements contained in the offers;
   (c) Compensation requested in the offers;
   (d) Name of the selected tenderer.

10.  At the request of a Member State, or on its own initiative, the Commission may request Member States to communicate, within one month, all relevant documents relating to the selection of an air carrier for the operation of a public service obligation. In the event that the requested documents are not communicated within the deadline, the Commission may decide to suspend the invitation to tender in accordance with the procedure referred to in Article 28(2).

Article 20

Examination of public service obligations

1.  Member States shall take all necessary measures to ensure that any decision taken under Articles 18 and 19 can be reviewed effectively and, in particular, as soon as possible, on the grounds that such decisions have infringed Community law or national rules implementing Community law.

In particular, at the request of a Member State, or on its own initiative, the Commission may request Member States to communicate, within two months:

   a) a document justifying the need for the public service obligation and its compliance with the criteria mentioned in Article 18,
   b) an analysis of the economy of the region,
   c) an analysis of the proportionality between the envisaged obligations and the economic development objectives,
   d) an analysis of ║ existing air services, if any, and of ║other modes of transport available which could be considered a substitute regarding the envisaged imposition of a public service obligation.

2.  At the request of a Member State which considers that the development of a route is being unduly restricted by the terms of Articles 18 and 19, or on its own initiative, the Commission shall carry out an investigation and, within six months of receipt of the request and in accordance with the procedure referred to in Article 28(2), shall take a decision, on the basis of all relevant factors, on whether Articles 18 and 19 shall continue to apply in respect of the route concerned.

Pending such a decision, the Commission may decide on interim measures including the suspension, in whole or in part, of a public service obligation.

Article 21

Traffic distribution between airports and exercise of traffic rights

1.  The exercise of traffic rights shall be subject to published Community, national, regional and local operational rules relating to safety, security, the protection of the environment and the allocation of slots.

2.  A Member State, after consultation of the air carriers and airports concerned, may regulate, without discrimination between destinations inside the Community or on grounds of nationality or identity of air carriers, the distribution of air traffic between airports satisfying the following conditions:

   a) the airports serve the same city or serve a conurbation in which they are all situated;
   b) the airports are served by an adequate transport infrastructure making it possible to arrive at the airport, using public transport, within an hour; and
   c) the airports are linked to one another and to the city or conurbation they shall serve by frequent, reliable and efficient public transport services.

Any decision to regulate the distribution of air traffic between the airports shall respect the principles of proportionality and transparency, and shall be based on objective criteria.

3.  Without prejudice to traffic distribution rules existing prior to the adoption of this Regulation, the Member State concerned shall inform the Commission of its intention to regulate the distribution of air traffic or to change an existing traffic distribution rule.

The Commission shall examine the application of paragraphs 1 and 2 and, within six months of receipt of this request, and in accordance with the procedure referred to in Article 28(2), shall decide whether the Member State may apply the measures.

The Commission shall publish its decision in the Official Journal of the European Union and the measures shall not be applied before the publication of the Commission's approval.

Article 22

Emergency measures

1.  A Member State may refuse, limit or impose conditions on the exercise of traffic rights to deal with sudden problems of short duration resulting from unforeseeable and unavoidable circumstances. Such action shall respect the principles of proportionality and transparency and shall be based on objective and non-discriminatory criteria.

The Commission and the other Member States shall be informed without delay of such action with its adequate justification. If the problems necessitating such action continue to exist for more than 14 days, the Member State shall inform the Commission and the other Member States accordingly and may, with the agreement of the Commission, prolong the action for further periods of up to 14 days.

2.  At the request of the Member State(s) involved, or on its own initiative, the Commission may suspend this action if it does not meet the requirements of paragraph 1 or is otherwise contrary to Community law.

Chapter IV

Provisions on Pricing

Article 23

Pricing 

Without prejudice to Article 25, this Chapter shall not apply to:

   a) air fares and rates charged by air carriers other than Community air carriers;
   b) air fares and rates established pursuant to a public service obligation in accordance with Chapter III.

Article 24

Pricing freedom

1.  Without prejudice to Articles 18(1) and 25, Community air carriers shall freely set air fares and rates for intra-Community air services.

2.  Notwithstanding the provisions of bilateral agreements between Member States, Member States may not discriminate on grounds of nationality or identity of air carrier in allowing Community air carriers to set fares and rates for air services between their territory and a third country. Any remaining restrictions on pricing, including with respect to routes to third countries, arising from bilateral agreements between Member States are hereby superseded.

Article 25

Information and non-discrimination

1.  This Article shall apply to flights departing from an airport situated in the territory of a Member State and to flights contracted by a Community air carrier departing from an airport located in a third country to an airport situated in the territory of a Member State, unless air carriers are subject to the same obligations in that third country.

2.  Air carriers operating within the Community shall provide the general public with comprehensive information on their air fares and rates in accordance with Article 2(18) and (19) and the conditions attached, and on all applicable taxes, non-avoidable charges, surcharges and fees levied by them for the benefit of third parties.

Air fares published in any form, including on the Internet, which are addressed directly or indirectly to the travelling public shall include all applicable taxes, non-avoidable charges, surcharges and fees known at the time of publication. Air fares shall not incorporate costs not actually incurred by air carriers.

Optional price supplements shall be communicated in a clear, transparent and unambiguous way at the start of any booking process and their acceptance by the passenger shall be on an "opt-in" basis. Implied agreements to accept such supplements shall be null and void.

All costs which are not part of the air fare and which are not levied by air carriers operating within the Community shall be comprehensively advertised by the "ticket seller" within the meaning of Article 2 (d) of Regulation (EC) No 2111/2005 of the European Parliament and of the Council of 14 December 2005 on the establishment of a Community list of air carriers subject to an operating ban within the Community and on informing air transport passengers of the identity of the operating air carrier(10).

3.  Air carriers shall allow access to air fares without any discrimination based on the nationality or the place of residence of the passenger or on the place of establishment of the travel agent within the Community.

Air carriers shall not impose rules on passengers and travel agencies which in practice restrict their free and equal access to air fares.

4.  For the implementation of the obligations set out in paragraphs 2 and 3, air carriers shall advertise their air fares and rates and the conditions attached, and all applicable taxes, charges and fees levied by them for the benefit of third parties, using the following categories:

   - taxes and other state charges and duties,
   - charges, duties, fees and other costs for the benefit of the airlines,
   - charges, duties, fees and other costs for the benefit of the airport operators.

5.  Consumers shall be provided with a full breakdown of any taxes, fees and charges added to the ticket price.

Article 26

Transparency in charging

Where airport or on-board security costs are included in the price of an air ticket, those costs shall be shown separately on the ticket or otherwise indicated to the passenger. Security taxes and charges, whether levied by Member States or by air carriers or entities, shall be transparent and shall be used exclusively to meet airport or on-board security costs.

Article 27

Penalties

Member States shall ensure compliance with the rules set out in this Chapter and shall lay down penalties for infringements thereof. Those penalties shall be effective, proportionate and dissuasive.

Chapter V

Final provisions

Article 28

Committee 

1.  The Commission shall be assisted by a committee.

2.  Where reference is made to this paragraph, Articles 3 and 7 of Decision 1999/468/EC║ shall apply, having regard to the provisions of Article 8 thereof.

Article 29

Cooperation and right to obtain information

1.  Member States and the Commission shall cooperate in applying and in monitoring the application of this Regulation.

2.  In order to carry out its duties under this Regulation the Commission may obtain all necessary information from Member States, which shall also ensure the provision of information by air carriers licensed by their competent licensing authorities.

3.  Member States shall, according to their national legislation, take the necessary measures to ensure appropriate confidentiality of the information received by them in application of this Regulation. 

Article 30

Repeal

Regulations (EEC) No 2407/92, 2408/92 and 2409/92 are repealed.

References to the repealed Regulations shall be construed as references to this regulation and shall be read in accordance with the correlation table in ║ Annex II ║.

Article 31

Entry into force

This Regulation shall enter into force on the day following that of its publication in the Official Journal of the European Union.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at ║

For the European Parliament For the Council

The President The President

ANNEX I

Information to be provided in the context of Articles 5 and 8

1.  Information to be provided by a first-time applicant from a financial fitness point of view

1.1.  The most recent internal management accounts and, if available, audited accounts for the previous financial year.

1.2.  A projected balance sheet, including profit and loss account, for the following three years.

1.3.  The basis for projected expenditure and income figures on such items as fuel, fares and rates, salaries, maintenance, depreciation, exchange rate fluctuations, airport charges, insurance, etc. Traffic/revenue forecasts.

1.4.  Details of the start-up costs incurred in the period between submission of an application and the commencement of operations and an explanation of how ║ these costs are to be financed.

1.5.  Details of existing and projected sources of finance.

1.6.  Details of shareholders, including nationality and type of shares to be held, and the Articles of Association. If part of a group of undertakings, information on the relationship between them.

1.7.  Projected cash-flow statements and liquidity plans for the first three years of operation.

1.8.  Details of the financing of aircraft purchase/leasing including, in the case of leasing, the terms and conditions of contract.

2.  Information to be provided for assessment of the continuing financial fitness of existing licence holders planning a change in their structures or in their activities with a significant bearing on their finances

2.1.  If necessary, the most recent internal management balance sheet and audited accounts for the previous financial year.

2.2.  Precise details of all proposed changes e.g. change of type of service, proposed takeover or merger, modifications in share capital, changes in shareholders, etc.

2.3.  A projected balance sheet, with a profit and loss account, for the current financial year, including all proposed changes in structure or activities with a significant bearing on finances.

2.4.  Past and projected expenditure and income figures on such items as fuel, fares and rates, salaries, maintenance, depreciation, exchange rate fluctuations, airport charges, insurance, etc. Traffic/revenue forecasts.

2.5.  Cash-flow statements and liquidity plans for the following year, including all proposed changes in structure or activities with a significant bearing on finances.

2.6.  Details of the financing of aircraft purchase/leasing including, in the case of leasing, the terms and conditions of contract.

3.  Information to be provided for assessment of the continuing financial fitness of existing licence holders

3.1.  Audited accounts not later than six months after the end of the relevant period and, if necessary, the most recent internal management balance sheet.

3.2.  A projected balance sheet, including profit and loss account, for the forthcoming year.

3.3.  Past and projected expenditure and income figures on such items as fuel, fares and rates, salaries, maintenance, depreciation, exchange rate fluctuations, airport charges, insurance, etc. Traffic/revenue forecasts.

3.4.  Cash-flow statements and liquidity plans for the following year.

ANNEX II

Correlation Table

Regulation (EEC) No 2407/92

This Regulation

Article 1(1)

Article 1

Article 1(2)

Article 3(3)

Article 2

Article 2

Article 3(1)

Article 3(2)

Article 3(2)

Article 3(1), second paragraph

Article 3(3)

Article 3(1), first paragraph

Article 4(1)

Article 4(1)

Article 4(2)

Article 4 f

Article 4(3)

-

Article 4(4)

Article 4 f

Article 4(5)

Article 8(1), second paragraph

Article 5(1)

Article 5(1)

Article 5(2)

Article 5(2)

Article 5(3)

Article 8(5)

Article 5(4)

Article 8(6)

Article 5(5)

Article 9(1)

Article 5(6)

Article 8(4)

Article 5(7)

Articles 5(3) and 8(8)

Article 6

Article 7

Article 7

Article 11

Article 8(1)

Article 13(1)

Article 8(2)

Article 12(1)

Article 8(3)

Article 13(2)

Article 8(4)

Article 12(2)

Article 9

Article 6

Article 10(1)

Article 13(3)

Article 10(2)

Article 13(4)

Article 11(1)

Article 8(1)

Article 11(2)

Article 8(3)

Article 11(3)

Article 8(7)

Article 12

Articles 9(2) – 9(4)

Article 13(1)

Article 10(2)

Article 13(2)

Article 10(1)

Article 13(3)

-

Article 13(4)

Article 10(3)

Article 14

Article 14

Article 15

-

Article 16

-

Article 17

-

Article 18(1)

Article 29(1)

Article 18(2)

Article 29(3)

Article 19

-

ANNEX

ANNEX I

Regulation (EEC) No 2408/92

This Regulation

Article 1(1)

Article 1

Article 1(2)

Article 1(2)

Article 1(3)

Article 1(3)

Article 1(4)

-

Article 2

Article 2

Article 3(1)

Article 17(1) and 17(2)

Article 3(2)

-

Article 3(3)

-

Article 3(4)

-

Article 4(1) a

Article 18(1)

Article 4(1) b

Article 18(6)

Article 4(1) c

Article 18(2)

Article 4(1) d

Article 18(4)

-

Article 19(1)

-

Article 19(2)

-

Article 19(3)

-

Article 19(4)

-

Article 19(5)

Article 4(1) e

Article 19(6)

Article 4(1) f

Article 19(7)

Article 4(1) g

-

Article 4(1) h

Article 19(8)

-

Article 19(9)

-

Article 19(10)

Article 4(1) i

Article 20(1)

Article 4(1) j

Article 18(3)

Article 4(1) k

-

Article 4(2)

-

Article 4(3)

Article 20(2)

Article 4(4)

-

Article 5

-

Article 6(1) and 6(2)

-

Article 7

Article 17(3) – 17(6)

Article 8(1)

Article 21(2)

Article 8(2)

Article 21(1)

Article 8(3)

Article 21(3)

Article 8(4)

-

Article 8(5)

-

Article 9(1)

-

Article 9(2)

-

Article 9(3)

-

Article 9(4)

-

Article 9(5)

Article 22

Article 9(6)

-

Article 9(7)

-

Article 9(8)

-

Article 10

-

Article 11

Article 28

Article 12(1)

Article 29(2)

Article 12(2)

-

Article 13

-

Article 14(1)

Article 29(1)

Article 14(2)

Article 29(3)

Article 15

-

Article 16

-

ANNEX I

-

ANNEX II

-

ANNEX III

-

-

Regulation (EEC) No 2409/92

This Regulation

Article 1(1)

Article 1

Article 1(2)

Article 23

Article 1(3)

Article 2

Article 2

Article 3

-

Article 4

Article 25

Article 5(1)

Article 24

Article 5(2)

-

Article 5(3)

-

Article 5(4)

-

Article 6

-

Article 7

-

Article 8

-

Article 9

-

Article 10(1)

Article 29(1)

Article 10(2)

Article 29(3)

Article 11

-

Article 12

-

-

Article 30

-

Article 31

(1) OJ C 175, 27.7.2007, p. 85.
(2) OJ C , , p. .
(3) Position of the European Parliament of 11.7.2007.
(4) OJ L 240, 24.8.1992, p. 1.
(5) OJ L 240, 24.8.1992, p. 8. Regulation as last amended by Regulation (EC) No 1791/2006 (OJ L 363, 20.12.2006, p. 1).
(6) OJ L 240, 24.8.1992, p. 15.
(7) OJ L 184, 17.7.1999, p. 23. Decision as amended by Decision 2006/512/EC (OJ L 200, 22.7.2006, p. 11).
(8) OJ L 138, 30.4.2004, p. 1.
(9) OJ L 157, 30.4.2004, p. 7.
(10) OJ L 344, 27.12.2005, p. 15.

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