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REVIEW OF EU GROUND HANDLING DIRECTIVE
By Dr. Christopher J. Smith, Managing Director, SH&E Limited

Background
Ground handling activities with the European Union must comply with the Directive adopted by the 15 Member States in 1996. SH&E had previously assisted the European Commission in the development of this Directive, and late last year won a major assignment to review the progress of its implementation.
As the legislation was in the form of a Directive rather than a Regulation, each Member State was required to pass its own legislation to bring the requirements of the Directive into force within its own territories. The use of a Directive also allowed each Member State to introduce additional provisions into national law, provided that such provisions were not contrary to the clauses of the Directive.

The Directive itself also placed an obligation on the Commission to report back to the European Parliament on the progress and success of the Directive and if necessary to suggest revisions to it. SH&E was contracted to gather the factual data on which the Commission would base its report.

The Directive
The objective of the Directive is to encourage the competitive provision of ground handling services at European airports, in order to reduce airline costs, improve quality and provide airlines with a choice of handling agent. In a number of Member States, ground handling services had historically been provided on a monopoly basis, either by the major base airline (e.g. Iberia, Olympic) or by the airport operator itself, a model common in Austria, Germany and Italy.
To ease the difficulties that changing from these positions might create, the Directive included transitionary arrangements which allowed for a gradual liberalisation of the market. By the commencement of SH&E’s assignment, the Directive applied to all airports which handled more than 2 million passengers or 50,000 tonnes of freight per annum for third party handling; and 1 million passengers or 25,000 tonnes of freight per annum for self handling. With the exception of four categories of ground handling, the Directive required that any organisation could provide ground handling services (subject to licensing for safety and financial fitness etc.), including airlines wishing to self-handle. However, for baggage, ramp, and freight and mail handling, and for fuelling, a Member State could limit the number of handlers to no less than two organisations. A further requirement was that at least one of the handlers had to be independent of both the airport operator and any airline(s) responsible for carrying more than 25% of the airport’s traffic.

The Assignment
Consultation with the many industry groups was a key feature of the assignment. The very first ‘active’ day of the assignment included a meeting with representatives of some 30 major stakeholders in Brussels, and the last field day also included a meeting with the same group. In between, there were visits to some 33 airports nominated by the Commission and a ‘postal’ (largely conducted by e-mail and fax!) survey of a further 50 or so airports. At each location, meetings were held not just with the airport operator, but with ground handlers (independent, self-handlers and where active the airport operator’s own handling department/company), individual airlines as well as the AOC and the Airport Users Committee. In some locations, we also met with representatives of the Civil Aviation department/agency and with worker representatives. There was also extensive consultation with all national civil aviation administrations by post to obtain national legislation, identify any features different from the Directive and discuss any national concerns/issues that had arisen.

Our Final Report runs to some 110 pages, with a volume of similar length containing appendices. It may be found on the Commission’s web site and also on our own web site.

The report discusses briefly a background to the Directive, describes the current position and changes in a number of elements since the introduction of the Directive. It then examines the legislative position in each Member State. The main body of the report is devoted to a discussion of a number of issues that were identified during the study. These ranged from the rate of implementation of the Directive, the selection processes followed, definitions of self handling, through the rule of User Committees and access fees and charges for centralised infrastructure, to employment issues.

The scope of the assignment was the collection and presentation of factual information. Analysis of this information in order to determine policy initiatives was explicitly excluded from the work, and remains the domain of the Commission.

The Final Report has received an extremely favourable reaction from the many different stakeholders, despite each having their own interests and positions to defend.


Contact:
Stephanie Toomey
Director of Marketing
SH&E, Inc.
Phone:  +1 617-225-2800
E-Mail: stoomey@sh-e.com
 

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