On 12 July 2022, the European Commission issued a proposal for a regulation submitted for approval to the Council and the EU Parliament to allow the airline slot regime to respond in a more flexible manner in the future. It aims at making the air traffic market more resilient to large-scale disruptions, such as the COVID-19 crisis or the war in Ukraine.
Due to the COVID-19 pandemic, air traffic suffered an unprecedented decline in passenger demand in 2020 and at the beginning of 2021 (April 2020: 89% decrease compared with the same period in 2019).
Although passenger demand declined in 2020 and 2021, Regulation 95/93 on common rules for the allocation of slots at Community airports depended on passenger demand to determine the slot regime. With the use-it-or-lose-it rule established in the Regulation in its Article 10, airline companies feared losing their slots at European airports. However, as that rule was suspended from 1 February 2020 to 27 March 2021, airlines kept their slots, allowing them slowly to regain their activity after the pandemic.
Following the unprecedented crisis, the EU took the approach to target slot relief to what is necessary and balanced by introducing certain pro-competitive aspects. With incumbent airlines having an advantage over new entrants, the slot use rate was gradually raised from 0% to 64% to avoid the risk of anti-competitive effects. When the slot use rate was at 0%, several new justified non-use of slots (“JNUS”) exceptions were introduced as an additional safeguard.
In its proposed amendment of Regulation 95/93, the Commission is willing to return to the standard slot use rate of 80% as of 30 October 2022 (currently 64% during summer 2022) and, at the same time, to extend the option to use the JNUS tool. The use of these exceptions would be authorised in situations of epidemiological emergencies, natural disasters or widespread political unrest that have a disruptive effect on air travel (as new threats have arisen with Russia’s invasion of Ukraine). According to its proposal, the Commission would have the power, as a last resort mechanism, to reduce the slot use rate if air traffic levels fall below 80% of the 2019 levels in the corresponding period.
Moreover, in its proposal, the Commission proposes several measures to mitigate the consequences of the Russia’s invasion of Ukraine. The Commission suggests using the flexibility granted under Article 8(4) of the Slot Regulation to retime slots used for direct routes affected by the prohibition from entering Russian, Belarusian and Ukrainian airspace. Also, the Commission proposes to include a 16-week recovery period before slot use requirements become applicable once Ukrainian airspace reopens. Other measures were proposed to help Ukraine to restore connectivity with the EU and to protect its market.
Finally, the proposal tackles the importance of enhancing transparency and coordination in giving JNUS exceptions. The Commission’s objective is to increase the cooperation between slot coordinators in Member States and, thus, increase transparency within the JNUS exceptions mechanism.
If adopted by the Council and the EU Parliament, the new regulation will come into force on 30 October 2022. The measures would remain in place until air traffic is estimated to have fully recovered.
Annabelle Lepièce - Partner, Brussels
