The Australian Competition and Consumer Commission today issued its final decision on Australia Pacific Airport Melbourne's application to introduce an aeronautical charge to recover the costs of a new multi-user domestic passenger terminal at Melbourne Airport.
"The ACCC's decision approves a new charge to fund construction of the $8.4 million domestic passenger terminal for new entrants", ACCC Chairman, Professor Allan Fels, said.
"The ACCC welcomes the passenger terminal proposed by APAM. At the moment domestic passenger terminal facilities at Melbourne Airport are provided by Qantas and Ansett. The new facility will allow new competitors such as Impulse Airlines and Virgin Blue to operate at Melbourne Airport in independently provided facilities. These have been designed in consultation with potential users and represent a cost-effective way of servicing new entrants.
"In April the ACCC issued a draft decision which supported the facility proposed by APAM, but did not agree to the price proposed. The draft decision was for a charge of $1.28 per arriving and departing passenger compared to APAM's application for a charge of $2.20. In reaching its decision the ACCC had regard to an agreement between APAM and Impulse for a charge of $1.65. Nevertheless, lack of support for the proposal from Virgin Blue and the ACCC's own cash flow modelling suggested that the $2.20 proposed by APAM and the $1.65 agreed to with Impulse Airlines may have been unnecessarily high.
"The issuing of the draft decision was followed by further negotiations between APAM and Virgin Blue. A negotiated outcome has been reached which is supported by all of the parties.
"The price agreed to in the final decision is $1.65 per arriving and departing passenger (GST inclusive), with discounts available to Impulse Airlines and Virgin Blue as negotiated and agreed to by the parties".