Select Committee on European Scrutiny Thirty-Fifth Report






COM(01) 335

Draft Regulation amending Council Regulation (EEC) No 95/93 on common rules for the allocation of slots at Community airports.

Legal base:

Article 80 (2) EC; co-decision; qualified majority voting




Basis of consideration:

SEM of 25 June 2002

Previous Committee Report:

HC 152-xxxiv (2001-02), paragraph 2 (26 June 2002)

To be discussed in Council:


Committee's assessment:

Politically important

Committee's decision:

For debate in European Standing Committee A




    1. The allocation of landing and taking-off slots at Community airports is regulated by Council Regulation No. 95/93[21], the purpose of which is to ensure an efficient distribution of slots in a transparent and open manner. The Commission proposes to modify the Regulation in order to:

    • clarify the legal nature of slots;

    • promote efficient allocation of slots through clear rules on methods and procedures, better definition of airport capacity and transparent, neutral procedures of consultation and mediation;

    • encourage the efficient use of slots; and

    • enhance competition between incumbent carriers and new entrants.

    1. We reported on the Commission's proposal on 5 December 2001 and 26 June 2002, but on both occasions we decided to leave the document uncleared, pending further information, including the Government's Regulatory Impact Assessment. We noted the Government's concerns about the proposals, including the removal of the provision allowing slots to be reserved for regional services and the possibility that interim changes made now might in practice delay a more fundamental reform later. We also reported that the aviation industry is concerned about the potential effects of the Commission's proposal. The airlines argue that the proposed definition of an airport slot would prejudge the nature of their rights over the slots they currently hold, and that the amended definition of "new entrant" would lead to a less efficient use of slots and disadvantage consumers. Concern has also been expressed about lack of flexibility regarding re-timings and slot mobility[22]. Airport authorities argue that the Commission's proposal fails to recognise their rights in respect of airport infrastructure.
    2. The Government's view

    3. The Government says that it originally expected the Commission in the first stage to propose only "technical changes" to the existing system in order to address the problems of inefficiency and lack of competition in the allocation of slots. It expected that the introduction of more radical proposals for providing greater market access, such as secondary trading of slots, would be considered under the second stage. In the event, the Commission's proposal goes beyond the mere technical and may delay, perhaps indefinitely, more radical and market-based reforms. The Parliamentary Under-Secretary of State (Mr David Jamieson) comments:
    4. "The Government believes that implementation of the Commission's proposal in its current form could have the effect of glueing up the slot allocation system in the UK, by limiting airlines' ability to improve and modify the landing and take off slots they are allocated. First, the proposal would outlaw the current grey market in slot trading between airlines. The exchange by airlines of a commercially attractive slot for an unattractive one (which is returned to the pool) plus cash has been an important means by which airlines have been able to develop operating schedules so as to best meet consumer needs. Second, the proposal reduces the priority given to the re-timing of slots already held by airlines, so that new entrants would have first refusal on unused slots in the pool rather than them being first made available for retimings of existing slots and then to new entrants.

      "The proposal does not, in the UK's view, promote the efficient use of scarce airport infrastructure. This is of particular concern as the UK has some of the most congested airports in Europe. The UK is keen for slots to be allocated using market mechanisms, which the UK believes would lead to more efficient allocation."


    5. The Government recognises that from the UK's point of view the existing Regulation is in need of modification and clarification, and that greater compliance is needed throughout the EU. On the other hand, the Government also recognises that the existing regulation has the advantage of allowing some flexibility to the extent that airlines are able to amend their slot timings and operate an unofficial grey market for slot allocations. There are fears that the Commission's proposals could stifle the unofficial grey market and ultimately have a damaging effect on passengers.
    6. As the Government indicates, the UK has the most to lose or gain from a revised Regulation, owing to the severe shortage of slots at Heathrow and to a lesser extent Gatwick. One particular concern is that airlines based in the UK may be more disadvantaged than those based elsewhere if slot mobility is reduced.
    7. We note that one option for the Government is to seek a delay of the Commission's proposal until the consultants' study into the more radical second-stage reforms is complete, which is expected to be around the end of 2003. We have decided to recommend the document for debate in order to give Members an opportunity to discuss the concerns about the Commission's proposal and to question the Minister about the Government's preferred option.


21  OJ No. L 14, 22.1.93, p.1. Back

22   The system for organising re-timing of slots is managed by Airport Coordination Limited (ACL), which was established as an independent company in 1992 by a group of major UK airlines to provide a high quality airport coordination service. Slot mobility covers re-timing and the unofficial (grey) market that has developed to facilitate bilateral trading of slots. Back

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