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Air Services (Competition) (Amendment) (EU Exit) Regulations 2019

My Lords, I thank noble Lords for their consideration of these draft instruments. On the slot allocation system, we are not moving to operate on our own. The current system of slot allocation, including the EU regulations, is based on guidelines produced at an international level by IATA. Those guidelines are not affected by EU exit. The system for slot allocation at UK airports will be the same after exit day as it is today, except that the role of the EU Commission will no longer apply.

The noble Lord is quite right to point out that slot reform in general has been around for some time, but there is an international consensus around this and we are considering it in our consultation strategy, Aviation 2050: The Future of UK Aviation. We set out a number of potential issues with the current process for slot allocation affecting competition in the aviation markets, such as historic grandfather rights and retiming, but there is a long-standing international system, so we will work very closely with the industry, IATA and countries with which the UK has aviation links to discuss that.

My noble friend Lady McIntosh asked whether current grandfather rights will be the same. Again, those will remain the same after exit day. As the noble Lord, Lord Tunnicliffe, pointed out, this does not change any policy on this and those rights that UK carriers have at EU/EEA airports will also not be affected.

On the point about the replacement of the competition regulation, raised by the noble Baroness, Lady Randerson, and my noble friend Lord Balfe, the UK has participated fully in the legislative process regarding the replacement regulation; it is now ready to be put to the European Parliament and the Council of Ministers, and it is intended to serve the same purpose as the current regulation—ensuring fair competition. But the powers, as I said, and as highlighted by my noble friend Lady McIntosh, have never been exercised and it is unlikely that they ever will be. The EU has reviewed the regulation, but the vast majority of our bilateral air services agreements have articles governing fair competition, and these are what we use to ensure that there is a level playing field in the operation of international air services. That is why it has not been used and we do not expect it to be used.

My noble friend Lord Balfe asked, as he did previously, about our future plans. We keep our legislation under ongoing review and will continue to do so after exit day to make sure that it meets our policy objectives and legal obligations. While we would not be under an obligation if we left without a deal, if we chose to implement the replacement regulation it would be through primary legislation. Again, my noble friend is right to point out that, of course, in the event of a no-deal exit the EU’s statute book will continue to move on and we will need to be flexible about ours.

My noble friend Lady McIntosh asked about timetables. Airlines have already published their timetables for flights post March 2019 and tickets are being sold. The noble Lord, Lord Bruce, asked about Aberdeen and the allocation of slots. As I mentioned before, slots are allocated through ACL and the EU: the Government have no role in the allocation of slots and airlines determine how they are allocated on a commercial basis. Of course, if a carrier does not use its slots 80% of the time, they will be returned to the slot pool for allocation. We have the option of PSOs if needed, but the decision about specific slots will be down to the commercial airline.

My noble friend Lady McIntosh asked about the EU regulations. She is right to point out that they were published in December. There has been many a conversation on those, through industry and through member states. We are seeing some proposed changes, particularly on a capacity freeze, as my noble friend pointed out. I agree with her that the aviation sector is incredibly important to this country, which is why we are working hard to ensure that the industry can continue to grow sustainably. She is right that there are issues around ownership and control. We have not seen the headquarters of easyJet move but we have seen easyJet take on a Swiss air operator certificate. There is no immediate issue, as my noble friend pointed out, but, as one might expect, EU carriers are working closely with the Commission on that.

We are seeking continued participation in the European Aviation Safety Agency. That will help us continue trade as well as flights. We have played a significant role in EASA over the years and we very much hope to continue to do so. PSOs will be open to qualifying carriers—those with cabotage rights in the UK—and that has already been fixed in the operation of air services SI. Those carriers with cabotage rights could include those from the EU and other countries, so there will be the same requirements for PSOs going forward.

I hope that I have answered most of the questions. If I have not, I will follow up in writing.