EU ANTITRUST: HOT TOPICS & NEXT STEPS

Prague, Czechia

EU ANTITRUST: HOT TOPICS & NEXT STEPS 2022

As mentioned above, air carriers are usually (mainly in case of restricted PSOs) granted also compensation for discharging the PSO. Thus, provided that the air carrier should be granted such compensation, the entrustment act should also contain provisions on how such compensation should be calculated and mechanisms for controlling and reviewing payment of such compensation, as well as for avoiding and recovering eventual overcompensation. Regardless of the above, such compensation may not also exceed the amount required to cover the net costs incurred in discharging each PSO, taking account of revenue relating thereto kept by the air carrier and a reasonable profit (Article 17(8) of the Air Services Regulation), and shall be set ex ante in order to exclude any ex-post coverage of the air carrier’s losses. It follows from the above that the content of the PSO imposed may highly differ, not only based on whether the air carrier is entrusted to operate the route on an exclusive basis or not, but also with respect to other conditions which may relate to the route in question and which should be thoroughly considered and reflected by the Member State in the entrustment act. And these conditions may also reflect provisions which may be more than useful in cases of extraordinary events, such as the current COVID-19 pandemic (e.g., force majeure clauses). 3.1.5 Procedure for imposing PSO The imposition of PSOs in air transport is based, in particular, on the principles of openness, publicity, non-discrimination, and transparency (Interpretative Guidelines, paras 7, 18). Therefore, if a Member State decides to impose a PSO on a route, it must first fulfil an extensive information obligation towards other entities. The Member State must first consult other Member States of its intention to impose a PSO and inform the Commission, the airports concerned, and the air carriers providing the air services on the route in question and provide them with sufficient time for comments (Article 16(1) of the Air Services Regulation). As soon as the Member State approves the final version of a planned measure by which it intends to impose the PSO (e.g., concludes a public contract), the Member State must re-notify it to the abovementioned subjects and the Commission, which will then publish a notice in the Official Journal of the EU, unless publication in the national official journal is sufficient (Article 16(4) and (5) of the Air Services Regulation). This notice is necessary not only to ensure the transparency and publicity of the imposition of PSO, but also because the publication of the notice in the Official Journal of the EU (or national office journal) is a key condition for its entry into force and at the earliest from that date, the PSO may apply to all Community air carriers operating on the route. Thus, after successful imposition of the PSO, all Community air carriers may at any time start operating

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