ACCC examining proposed pricing for air traffic control services at Avalon airport

The Australian Competition and Consumer Commission has extended the period for examining Airservices Australia's proposed price for a terminal navigation service at Avalon airport to 28 January 2010.

The extension will allow proper consultation with affected parties such as airlines and airport owners on the price that would apply to aircraft landing at Avalon aerodrome.

Airservices proposes to commence charging for a terminal navigation service that will apply to aircraft landing at Avalon aerodrome from 1 February 2010 at a price of $5.49 (incl. GST) per tonne.

The ACCC received the price notification from Airservices on 21 December 2009. Under the Trade Practices Act 1974, the ACCC has 21 calendar days from receiving a notification to decide whether or not it objects to the proposed price. Without an extension, the last day for making a decision would have been Monday, 11 January 2010.

"The opportunity for users to consider and comment on proposed prices that affect them is an important part of the ACCC's consideration," ACCC Chairman, Graeme Samuel said.

"The timing for consideration originally proposed by Airservices—spanning the Christmas-New Year holiday period—made consultation for parties on the proposed price particularly difficult.

"Even the limited discussion with some stakeholders that was possible revealed a range of different views about future demand for the service, and therefore about the appropriate price," Mr Samuel said.

"The ACCC has advised it would find it difficult to not object to a proposal on which affected parties have had insufficient opportunity to comment. Consequently, Airservices has this morning proposed that the period for consideration be extended until 28 January 2010 to allow all parties to be appropriately consulted. The ACCC has accepted Airservices proposed extension of time."

Airservices is the monopoly provider of en-route air navigation, terminal navigation and aviation rescue and fire-fighting services in Australia. These services are declared under Part VIIA of the Trade Practices Act 1974, which means that Airservices must notify the ACCC when it wishes to increase prices. The ACCC may object or not object to the proposed increases.

Terminal navigation services are supplied at specific airports on the basis of safety regulations. Prices for these services differ across the different locations at which they are provided. The Civil Aviation Safety Authority has identified the need for a terminal navigation service at Avalon.