Session 2012 - 13
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Civil Aviation Bill


Civil Aviation Bill
Part 1 — Airports
Chapter 1 — Regulation of operators of dominant airports

13

 

Licence conditions

18      

Licence conditions

(1)   

A licence may include—

(a)   

such conditions as the CAA considers necessary or expedient having

regard to the risk that the holder of the licence may engage in conduct

5

that amounts to an abuse of substantial market power in a market for

airport operation services (or for services that include airport operation

services), and

(b)   

such other conditions as the CAA considers necessary or expedient

having regard to the CAA’s duties under section 1.

10

(2)   

For the purposes of this section conduct may, in particular, amount to an abuse

of substantial market power if it is conduct described in section 18(2)(a) to (d)

of the Competition Act 1998.

19      

Price control conditions

(1)   

For the purposes of this Part a licence condition is a price control condition to

15

the extent that it regulates prices by—

(a)   

providing that the amount, or the maximum amount, that may be

charged is an amount specified in, or determined in accordance with,

the condition, or

(b)   

requiring the amount, or maximum amount, that may be charged to be

20

approved by the CAA.

(2)   

A licence must include such price control conditions as the CAA considers

necessary or expedient having regard to the risk referred to in section 18(1)(a).

(3)   

The duty in subsection (2) has effect subject to—

(a)   

the provision in this Chapter about the conditions that may be included

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in the licence,

(b)   

the provision in this Chapter about granting licences, and

(c)   

the provision in this Chapter and in the licence about modifying licence

conditions.

(4)   

Subsection (5) applies where the CAA considers that the holder (“H”) of a

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licence for an airport area engaged in conduct amounting to an abuse of

substantial market power by directly or indirectly imposing unfairly high

charges in respect of activities carried on in the airport area during—

(a)   

a period during which H was treated as having a licence in respect of

the area by virtue of section 4;

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(b)   

a period during which H would have been so treated but for the

suspension of a market power determination or operator

determination under Schedule 1.

(5)   

The licence may include such price control conditions as the CAA considers

appropriate for the purpose of depriving the holder of the licence of an amount

40

not exceeding the amount which the CAA considers was earned from the

abuse during that period.

(6)   

A price control condition may make provision—

(a)   

by reference to the amount charged for particular goods or services;

 
 

Civil Aviation Bill
Part 1 — Airports
Chapter 1 — Regulation of operators of dominant airports

14

 

(b)   

by reference to the overall amount charged for a range of goods or

services.

(7)   

A licence that includes a price control condition must include conditions

specifying a period or periods for which the price control condition has effect.

20      

Conditions relating to CAA charges

5

(1)   

A licence may include conditions requiring the payment to the CAA of charges

determined under a scheme or regulations made under section 11 of the Civil

Aviation Act 1982 in respect of the carrying out of the CAA’s functions under

this Chapter.

(2)   

Such conditions may require the payment of charges on the grant of the licence

10

or while it continues in force (or both).

(3)   

The inclusion of such conditions does not prevent the CAA recovering charges

mentioned in subsection (1) as a debt due to it.

21      

Content and effect of licence conditions

(1)   

Licence conditions may, in particular, include—

15

(a)   

provision for a condition to have effect or to cease to have effect at times

or in circumstances specified in, or determined in accordance with, a

condition,

(b)   

provision requiring the holder of the licence to enter into a contract or

other arrangement for a purpose specified in a condition and on terms

20

specified in, or determined in accordance with, a condition,

(c)   

provision requiring the holder of the licence to comply with

requirements imposed (by directions or otherwise) by a specified

person,

(d)   

provision requiring the holder of the licence to do or not to do things

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specified, or of a description specified, in the licence unless a specified

person consents to its not doing or doing those things,

(e)   

provision requiring the holder of the licence to refer a matter to a

specified person for approval or determination, and

(f)   

provision relating to activities carried on outside the airport area for

30

which the licence is granted.

(2)   

In subsection (1) the references to a specified person are to—

(a)   

a person specified, or of a description specified, in a condition for the

purpose concerned, and

(b)   

a person nominated for the purpose concerned by a person within

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paragraph (a).

(3)   

A licence condition may include provision for its modification only if it

specifies or describes—

(a)   

the circumstances in which it may be modified,

(b)   

the types of modification that may be made, and

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(c)   

the period or periods in which it may be modified.

(4)   

If a licence condition includes such provision, it may be modified in accordance

with that provision or in accordance with the provision made by this Chapter

about modifying licence conditions.

 
 

Civil Aviation Bill
Part 1 — Airports
Chapter 1 — Regulation of operators of dominant airports

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(5)   

Where a licence condition is subject to an exception (however expressed)

relating to, or operating by reference to, financial arrangements entered into by

the holder of the licence, or a person connected to the holder of the licence,

before section 3 came into force, the licence may not—

(a)   

provide for the exception to cease to have effect at times or in

5

circumstances specified in, or determined in accordance with, a licence

condition, or

(b)   

provide for the CAA to determine which financial arrangements

benefit from the exception.

(6)   

A licence condition does not have effect at a time when—

10

(a)   

the holder of the licence is not the operator of any part of the airport

area for which the licence is granted, or

(b)   

that airport area is not a dominant area located at a dominant airport

(or part of such an area) and does not include all or part of such an area,

   

and provision included in a licence under subsection (1)(a) has effect subject to

15

this subsection.

Modifying licences

22      

Modifying licence conditions and licence area

(1)   

The CAA may modify a licence by modifying—

(a)   

the licence conditions, or

20

(b)   

the area for which the licence is granted,

   

subject to section 23.

(2)   

Before modifying a licence in reliance on this section, the CAA must—

(a)   

publish a notice in relation to the proposed modification,

(b)   

send a copy of the notice to the persons listed in subsection (3), and

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(c)   

consider any representations about the proposed modification that are

made in the period specified in the notice (and not withdrawn).

(3)   

Those persons are—

(a)   

the holder of the licence, and

(b)   

such bodies representing airport operators or providers of air transport

30

services as the CAA considers appropriate.

(4)   

The notice under subsection (2) must—

(a)   

state that the CAA proposes to modify the licence,

(b)   

specify the proposed modification,

(c)   

give the CAA’s reasons for the proposed modification,

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(d)   

state the effect of the proposed modification, and

(e)   

specify a reasonable period for making representations.

(5)   

If, after publishing the notice under subsection (2), the CAA decides not to

modify the licence in reliance on this section, the CAA must—

(a)   

publish a notice, giving its reasons, and

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(b)   

send a copy of the notice to the persons listed in subsection (3).

(6)   

If, after complying with subsections (2) to (4) in relation to a modification, the

CAA decides to modify the licence in reliance on this section, the CAA must—

(a)   

publish a notice in relation to the modification, and

 
 

Civil Aviation Bill
Part 1 — Airports
Chapter 1 — Regulation of operators of dominant airports

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(b)   

send a copy of the notice to the persons listed in subsection (3).

(7)   

The CAA is not to be treated as having complied with subsections (2) to (4) in

relation to a modification of a licence if the modification differs significantly

from the modification proposed in the notice under subsection (2).

(8)   

The notice under subsection (6) must—

5

(a)   

specify the modification,

(b)   

specify the date from which the modification has effect (subject to

paragraphs 7 and 11 to 13 of Schedule 2),

(c)   

give the CAA’s reasons for the modification,

(d)   

state the effect of the modification,

10

(e)   

state how it has taken account of any representations made in the

period specified in the notice under subsection (2), and

(f)   

state the reason for any differences between the modifications and

those set out in the notice given under subsection (2).

(9)   

In the case of a modification of a licence condition, the date specified under

15

subsection (8)(b) must fall after the end of the period of 6 weeks beginning with

the day on which the notice under subsection (6) was published (subject to

paragraph 20(2) of Schedule 2).

23      

Restriction on power to modify

(1)   

This section applies where—

20

(a)   

a licence condition is subject to an exception (however expressed)

relating to, or operating by reference to, financial arrangements

specified or described in the licence,

(b)   

the financial arrangements were entered into by the holder of the

licence, or a person connected to the holder of the licence, before section

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3 came into force, and

(c)   

the CAA proposes to modify the licence by removing or restricting the

exception.

(2)   

The CAA may not make such a modification unless it has determined that—

(a)   

there has been a material change of circumstances since the day on

30

which the exception was included in the licence condition, and

(b)   

for users of air transport services, the benefits of the modification are

likely to outweigh any adverse effects.

(3)   

On or before the day on which it publishes a notice under section 22(2) in

respect of a proposal to make such a modification, the CAA must—

35

(a)   

publish a notice of its determination under subsection (2) of this

section, giving its reasons for the determination, and

(b)   

send a copy of the notice to the persons listed in subsection (4).

(4)   

Those persons are—

(a)   

the holder of the licence, and

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(b)   

such bodies representing airport operators or providers of transport

services as the CAA considers appropriate.

(5)   

For the purposes of subsection (1)(b), financial arrangements entered into after

section 3 came into force but pursuant to other financial arrangements entered

into by the holder of the licence, or a person connected to the holder of the

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licence, before that time are to be treated as entered into before that time.

 
 

Civil Aviation Bill
Part 1 — Airports
Chapter 1 — Regulation of operators of dominant airports

17

 

(6)   

In subsection (2) “material change of circumstances” includes a material

change in the terms of the financial arrangements.

Appeals against licence conditions etc

24      

Appeal to Competition Commission: conditions of new licences

(1)   

An appeal lies to the Competition Commission against a decision by the CAA

5

under section 15 to include, or not to include, a condition in a licence when it

is granted.

(2)   

An appeal may be brought under this section only by—

(a)   

the holder of the licence, or

(b)   

a provider of air transport services whose interests are materially

10

affected by the decision.

(3)   

An appeal may be brought under this section only with the permission of the

Competition Commission.

(4)   

An application for permission to appeal under this section may be made only

by a person who, if permission is granted, will be entitled to bring the appeal.

15

(5)   

The Competition Commission may refuse permission to appeal under this

section only on one of the following grounds—

(a)   

that the appeal is brought for reasons that are trivial or vexatious, or

(b)   

that the appeal does not have a reasonable prospect of success.

25      

Appeal to Competition Commission: modification of licence conditions

20

(1)   

An appeal lies to the Competition Commission against a decision by the CAA

to modify a licence condition under section 22.

(2)   

An appeal may be brought under this section only by—

(a)   

the holder of the licence, or

(b)   

a provider of air transport services whose interests are materially

25

affected by the decision.

(3)   

An appeal may be brought under this section only with the permission of the

Competition Commission.

(4)   

An application for permission to appeal under this section may be made only

by a person who, if permission is granted, will be entitled to bring the appeal.

30

(5)   

The Competition Commission may refuse permission to appeal under this

section only on one of the following grounds—

(a)   

that the appeal is brought for reasons that are trivial or vexatious,

(b)   

that the appeal does not have a reasonable prospect of success, or

(c)   

that subsection (6) is satisfied.

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(6)   

This subsection is satisfied if the appeal is brought—

(a)   

against a decision that relates entirely to a matter remitted to the CAA

following an earlier appeal under section 24 or this section, and

(b)   

on grounds that were considered, or could have been raised by the

current applicant or a relevant connected person, as part of the earlier

40

appeal.

 
 

Civil Aviation Bill
Part 1 — Airports
Chapter 1 — Regulation of operators of dominant airports

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(7)   

In subsection (6), in relation to an applicant, “relevant connected person”

means a person who was connected to the applicant at any time during the

consideration of the earlier appeal by the Competition Commission.

26      

When appeals may be allowed

The Competition Commission may allow an appeal under section 24 or 25 only

5

to the extent that it is satisfied that the decision appealed against was wrong on

one or more of the following grounds—

(a)   

that the decision was based on an error of fact;

(b)   

that the decision was wrong in law;

(c)   

that the decision was based on the wrong exercise of a discretion.

10

27      

Determination of appeal

(1)   

Where it does not allow an appeal under section 24 or 25, the Competition

Commission must confirm the decision appealed against.

(2)   

Where it allows an appeal under section 24 or 25, the Competition Commission

must do one or more of the following—

15

(a)   

quash the decision appealed against;

(b)   

remit the matter that is the subject of the decision appealed against to

the CAA for reconsideration and decision in accordance with this

Chapter and any directions given by the Commission;

(c)   

substitute its own decision for that of the CAA.

20

(3)   

Where it allows only part of an appeal under section 24 or 25

(a)   

subsection (2) applies in relation to the part of the decision appealed

against in respect of which the appeal is allowed, and

(b)   

subsection (1) applies in relation to the rest of that decision.

(4)   

Where the Competition Commission substitutes its own decision for that of the

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CAA, the Commission may give directions to—

(a)   

the CAA, and

(b)   

the holder of the licence.

(5)   

The Competition Commission must not give a direction under this section that

requires a person to do anything that the person would not have power to do

30

apart from the direction.

(6)   

A person to whom a direction is given under this section must comply with it.

(7)   

A direction given under this section to a person other than the CAA is

enforceable—

(a)   

in England and Wales and Northern Ireland, as if it were an order of the

35

High Court, and

(b)   

in Scotland, as if it were an order of the Court of Session.

28      

Determination of appeal: time limits

(1)   

The Competition Commission must determine an appeal under section 24 or

25 against a decision in respect of a licence within the period of 24 weeks

40

beginning with the day on which the CAA published the relevant notice,

subject to subsections (3) to (6).

 
 

Civil Aviation Bill
Part 1 — Airports
Chapter 1 — Regulation of operators of dominant airports

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(2)   

In subsection (1) “the relevant notice” means—

(a)   

in the case of an appeal under section 24, the notice published in

accordance with section 15 of the decision to grant the licence, and

(b)   

in the case of an appeal under section 25, the notice published in

accordance with section 22 of the decision that is the subject of the

5

appeal.

(3)   

The Competition Commission may extend the appeal period by not more than

8 weeks if it is satisfied that there are good reasons for doing so.

(4)   

The Competition Commission may only extend the appeal period once in

reliance on subsection (3).

10

(5)   

The Competition Commission may extend the appeal period by such period as

it considers appropriate if—

(a)   

there is an appeal to the Competition Appeal Tribunal under this

Chapter which the Commission considers may be relevant to the

appeal under section 24 or 25, and

15

(b)   

the appeal to the Tribunal has not been determined or withdrawn.

(6)   

The Competition Commission may extend the appeal period more than once

in reliance on subsection (5).

(7)   

If the Competition Commission extends the appeal period it must—

(a)   

publish a notice stating the new time limit for determining the appeal,

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and

(b)   

send a copy of the notice to the persons listed in subsection (8).

(8)   

Those persons are—

(a)   

the holder of the licence which is the subject of the appeal,

(b)   

if the appeal was brought by someone other than the holder of that

25

licence, the appellant,

(c)   

any other person with a qualifying interest in the decision that is the

subject of the appeal (see paragraph 34(4) of Schedule 2),

(d)   

such bodies representing airport operators or providers of air transport

services as the Competition Commission considers appropriate, and

30

(e)   

the CAA.

(9)   

The Secretary of State may by regulations modify the periods of time specified

in this section.

(10)   

In this section “the appeal period”, in relation to an appeal under section 24 or

25, means the period allowed for determining the appeal.

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29      

Determination of appeal: publication etc

(1)   

A determination made by the Competition Commission on an appeal under

section 24 or 25

(a)   

must be contained in an order made by the Commission, and

(b)   

takes effect at the time specified in the order or determined in

40

accordance with the order.

(2)   

The order must set out the reasons for the determination.

(3)   

The Competition Commission must—

 
 

 
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Revised 10 May 2012