Regulators have firmed proposals to end the current exemption from European Union (EU) competition rules for its passenger tariff conferences on intra-EU routes from the end of the year.
The European Commission (EC) issued the proposals last November after a lengthy consultation over whether the benefits from interlining agreements reached at these conferences outweighed competition concerns.
It has now adopted a revision to the block exemption the IATA tariff conferences have enjoyed since 1993, ending exemption on tariff conferences for intra-EU routes from the start of next year.
The revised regulation retains exemption on EU routes to the USA and Australia until 30 June 2007, and to other non-EU countries up to 31 October 2007. The later date reflects the greater importance placed on interlining flight to non-EU destinations.
This though is earlier than the mid-2008 end originally set for exemption on non-EU routes, as long as airlines provided the necessary data to allow the EC to carry out a review in 2008. But it ties in with moves from the Australian and US authorities to review their exemption for IATA tariff conferences. First decisions from these countries are expected by June 2007, while the EC considers a year to be an “appropriate” transition period on other routes.
The EC this week says airlines benefiting from block exemption on non-EU routes must provide the EC with data on interlining to allow it to consider whether the block exemption on these routes should be extended beyond 30 June 2007 and 31 October 2007 respectively.
European competition chief Neeli Kroes says: “IATA passenger tariff conferences appear to facilitate interlining on routes to third countries, but I do not have sufficient assurances that they continue to benefit passengers on journeys within the EU.
“The possible prolongation beyond 2007 of the exemption for tariff conferences on routes to non-EU countries depends on the provision of data showing that IATA interlining continues to benefit consumers.”
The EC stresses ending the block exemption does not mean prohibiting interline agreements themselves. “Rather it is about withdrawing the legal assurance that the agreements concerned are compatible with the competition rules and putting the responsibility on IATA and its members to ensure their agreements are compliant with the competition rules,” it says.
But the EC has found IATA slots and scheduling conferences are “clearly compatible” with competition rules. “The legal certainty provided by a block exemption is therefore no longer needed and the EC will not prolong the block exemption for slots and scheduling beyond 31 December 2006,” it says.
Source: FlightGlobal.com
