Airservices Australia price notification – Long-Term Pricing Agreement – September 2011

Summary

On 9 September 2011, the Australian Competition and Consumer Commission (ACCC) received a price notification (a locality notice) from Airservices Australia (Airservices) under subsection 95Z(5) of the Competition and Consumer Act 2010 (Cth) (CCA).

Airservices’ price notification proposed to increase charges for the provision of terminal navigation (TN) and aviation rescue and fire-fighting (ARFF) services over a five year period (2011-12 to 2015-16), commencing 1 October 2011. Prices for enroute services were to decrease. 

On 21 September 2011, the ACCC decided to not object to the proposed price increases. For the reasons set out in its decision paper, the ACCC considered that Airservices had addressed the concerns expressed in the ACCC’s decision on a previous price notification submitted by Airservices.

Airservices had previously submitted a price notification to the ACCC on 22 August 2011. The ACCC considered that Airservices, by seeking to change one aspect of the methodology used to estimate a rate of return on capital, had proposed a rate of return that was too high and would cause Airservices to over-recover its costs over the five years. The ACCC decided to object to the proposed price increases in that price notification on 7 September 2011.