The Australian Competition and Consumer Commission has issued a draft determination proposing to grant authorisation to the Board of Airline Representatives of Australia Inc to continue to engage in collective negotiations, on behalf of its member international airlines, for essential airport services.

The ACCC proposes to authorise BARA to collectively negotiate with parties specifically identified by them - the major international airports, Gold Coast Airport, the Bureau of Meteorology, and Airservices Australia.

"Collective negotiations are likely to continue to deliver benefits, including in the form of transaction cost savings for both the providers of essential airport services and the airlines," ACCC chairman Graeme Samuel said.

In proposing to grant authorisation, the ACCC has taken into account the relative bargaining position of the airports.  The ACCC considers that the collective negotiation arrangements would be likely to provide the airlines with an enhanced level of input into the negotiation process.

Authorisation would provide BARA with immunity from the application of the Trade Practices Act 1974 with regard to collective negotiations for essential airport services. 

Participation in the collective negotiations is voluntary for providers of essential airport services and BARA members are not bound by the terms and conditions negotiated by BARA.

Collective bargaining refers to competitors collectively negotiating terms and conditions with a supplier or customer. Without authorisation, it can raise concerns under the competition provisions of the Trade Practices Act 1974. Broadly, the ACCC may grant authorisation when it is satisfied that the public benefit from the conduct outweighs any public detriment.

The ACCC's draft determination will be available from the ACCC website (www.accc.gov.au/AuthorisationsRegister) and by following the links to this matter.

The ACCC invites submissions in relation to the draft determination before making its final decision. Parties wishing to make submissions should do so by 7 April 2010. Please refer to the website for further information about making a submission to the ACCC.

Related register records