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AAPA Summit Report
compensate for delayed ights) but also from Asian
carriers. is irritation turned to anger during the
volcanic-ash related European airspace shut-down
earlier this year.
Tony Tyler, chief executive officer of Cathay
Paci c pointed to the "absurdity" of his Hong Kong-
based carrier having to pay for two weeks' hotel
accommodation in London for stranded passengers.
Brian Johnson, the European Parliament's transport-
committee chairman, defended the regulation, which
guarantees stranded passengers between 125 euros
and 600 euros compensation, depending on ight
distance and the delays incurred when rerouted.
"It's like drunk-driving laws. I would never drink
and drive, but laws let people know it's wrong. So
airlines now know it's wrong to overbook and then
bump passengers o ," he said.
However, he also admitted that the rules as they
stand were not designed for such extended periods of
disruption as the ash cloud and said that "his bet" was
that 261 would now be altered to limit the duration of
any payments as well as being extended to other forms
of transport, levelling the playing eld.
Nonetheless, Herdman points out that in the US
there is a notice of proposed rulemaking passing
through Congress on similar broad passenger-
protection regulations for US airlines. e rulemaking
on enhancing airline-passenger protection proposes a
minimum of US$650 compensation for overbooked
ights and similar penalties for severe delays and lost
Within the AAPA's own region, China, the
Philippines and Thailand are all, for example,
tentatively considering passenger-protection rules.
Herdman said these minimum levels of
compensation amount to a "compulsory insurance"
that would raise air fares and e ectively take choice
away from consumers. Asian airlines are known for
better ser vice than US and European carriers, but
these rules could make them lose that competitive
advantage, he warned.
"Introducing overly prescriptive legislation to
regulate customer care constrains the airlines' ability
to innovate and use superior level as a point of
di erence," he said.
" e AAPA calls on governments to refrain from
introducing legislation that would act as a disincentive
to compete freely on customer ser vice standards, and
also [to] ensure mandated regulations related to
passenger processing and treatment are designed from
the outset to be practical, cost-e ective, e cient and
sustainable," the 17-member association agreed.
Many of the calls for pa ssenger-protection
regulations arise from the varying ser vice standards
allowed by airline deregulation.
"We used to have standardised baggage allowance
rules but we were accused of collusion, so every airline
went [its] own way and now we see passengers confused
when they interline from one carrier to another and
get ned when there are di erent allowances. So now
the regulators say we should standardise our baggage
allowances," Herdman said.
He further argued that if any denied-boarding
compensation standards or passenger-protection
regulations are needed, the right forum for such
discussions would be the International Civil Aviation
Organization (ICAO), ensuring that globally
harmonised rules can be formulated.
e AAPA's preferred solution would be to push
for better adoption of travel insurance that covers force
majeure and other airline eventualities. "If you want
to stop bad things happening, then you have to insure
against it. In other areas of life people take chances,
risking not insuring , so why not travel?" Herdman
e AAPA also railed against a series of new taxes
being imposed, largely by European countries, many
of which are distance-based, thus discriminating
against Asian carriers ying into the Old Continent.
Austria, Germany and the UK were singled out as
worst o enders.
e taxes, o en dressed up as security charges or
departure fees, do not go to fund airport infrastructure
or even rival transportation like fast trains, instead
ending up in general consolidated government
revenue, Herdman said.
"These taxes are paid by the passenger and
collected by the airline on their behalf. ey come
under a number of di erent labels and are contained
within the ticket price, so whether it's an arrival fee,
a departure fee, security surcharge, airport passenger
duty, visa processing fee or whatever, these all appear
to the passenger as being part of the ticket. Around
15 percent of most tickets are taxes of some kind," he
The AAPA is "very concerned about the
proliferation of new taxes," he continued. Such
government charges are counterproductive and could
lead to fewer new routes as the cost of ying rises. It
is now cheaper, for example, for passengers travelling
to London from much of the Asia-Paci c to y into
Brussels and take the Eurostar high-speed train.
e Netherlands is alone among European nations
to realise the negative impact of high airport taxes. e
country was praised at the Brunei meeting for having
scrapped its passenger-movement charge a er a study
showed its negative e ect on business tra c.
"Unjustified taxes do untold damage to the
economy of the state imposing [them]," Herdman said.
"Fortunately economies in this part of the world know
the value of tourism and aviation to their economies."
Another example of European legislation that has
generated much industry opposition is the emissions
trading scheme, which will apply to airlines for the
rst time from 2012.
All airlines must buy carbon credits for the entire
duration of any ight entering the EU, not just that
part own over European airspace. Asian airlines
object to the plan, arguing that on a ight from Seoul
to Paris, for example, the majority of the emissions
would occur outside EU airspace.
Singapore Airlines' outgoing Chief Executive
Chew Choon Seng , said the scheme discriminated
against Asian carriers whose journey into Europe was
far longer than those of their Middle-Eastern rivals.
"We are halfway around the world. Why not pay at
point of entry [into the EU]?" he asked European
Johnson replied that the emissions trading
scheme was the responsibility of the parliament's
environmental committee, not his own transport
committee. e environmental committee comprises
ecological fundamentalists, he said.
His is the voice of reason within the European
Parliament, watering down the initial proposals for
a 100% charge for aviation, he claimed. "You want
to see what the Taliban -- I mean the environmental
committee -- rst proposed and believe me, this is a
whole lot better," he said.
No matter. e AAPA wants a global approach
for the global industry. ICAO should be the forum
where a new global standard should be decided,
Rather than shy away from the need to control
emissions, Asian carriers have more incentive to work
towards greener fuel initiatives, since they y longer
stage lengths than European and North American
counterparts, he said. Just as with passenger-rights
AAPA chief Andrew Herdman challenged
governments' policies on the environment,
taxation and passenger services.
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