Milton told a meeting of Star Alliance chief executives in Montreal that the grouping would consider co-ordinated action to persuade or compel airports to moderate spending and rein in capital and infrastructure budgets.
As host of the latest Star Alliance chief executive board meeting in December, Milton rallied at least one Star ally – United Airlines – to his fight against rising airport fees that finance what he sees as grand and grandiose terminal construction – the “Taj Mahal” syndrome, as he calls it. Arriving at the Star summit from a meeting of the IATA board, which he chairs this year, Milton revealed plans for a possible alliance boycott of airports deemed to be the leading offenders. “Airlines are going to have to talk in unison, beyond what the head of IATA, Giovanni Bisignani, calls ‘shouting politely’,” he said.
Bisignani has campaigned for the past three years against what he sees as excessive airport fees and has clashed publicly with trade body Airport Council International in November, when the latter told its members not to negotiate with IATA.
Milton says a boycott would mean airlines as a group determining they will not fly to a destination. “That was discussed and I think there really is a willingness to go that far because some of what is being done is absurd. Unless we begin to act with one voice, we will continue to see this sort of reckless expenditure by generally ungoverned bodies around the world.” By that he means the “private monopolies” he feels many airports have become.
United chief executive Glenn Tilton says: “I’m part of Robert’s hit squad.” Tilton joined Milton in naming Venezuelan airports as a possible target. There, unlike nearly-completed Toronto, action might head off unreasonable plans and inequitable fees, says Tilton. “There are a lot of airports on the hit list,” he adds, stressing that any co-ordinated action would begin with discussion and persuasion.
Milton singles out French proposals for airline taxation as “incredibly short-sighted”. He adds: “Some governments just find us [airlines] an easy, lazy target. You generally find in terms of fiscal performance, the laziest, sloppiest governments in the world are the ones that come up with these silly charges.”
However, lawyers warn that the idea is likely to fall foul of competition laws, particularly in Europe. Neil Baylis, London-based partner at law firm Kirkpatrick & Lockhart Nicholson Graham, warns that a boycott could contravene Article 81 of the Treaty of Rome, the European equivalent of anti-trust legislation. “There is a basis for a claim to be made,” he says, warning that even an informal arrangement could be seen as distorting competition.
“The comments from Star are something of a smoking gun,” he says, adding that even if the airport was outside the Europe, a case could still be brought if an airline sold tickets to that airport. “The European Commission (EC) has been looking quite closely at this industry recently, and there will certainly be personnel in Brussels who are picking up on this.” A complaint by an airport could lead to an investigation by the EC, he warns. ■
DAVID FIELD/WASHINGTON AND COLIN BAKER/LONDON
Source: Airline Business