Since opening its aviation market to competition, the national airlines of states within the European Union can operate freely in France.
Public air transport operates with aircraft traveling from a point of origin to a point of destination. This includes transportation of passengers, cargo, and mail. The exercise of public air transport activity is dependent on the possession of a license and an Air Operator’s Certificate issued by the French administrative authority.
Decisions on the licensure of air carriers, including the issuing, conversion to temporary license, suspension, and revocation are decided by the order of the Minister of Civil Aviation after consultation with the administrative board of aviation (Article R. 330-19 of the Code of Civil Aviation).
In accordance with Article R. 330-2 ACC, a carrier attempting to obtain an operating license must guarantee that its primary function is public air carrier activity and also register its principal place of business and, if any, its offices in the territory of the French Republic.
Thus, a company wishing to obtain a carrier license in France must meet the following requirements: it must be owned (continue to be owned), either directly or through majority ownership by Member States of the European community or the parties to Agreement on the European Economic Area or any other agreement having the same effect on air transport, or by nationals of those States. Specified companies must be able, at any time, to prove that they are effectively controlled by such States or their nationals.
Once a company obtains their license and AOC, it is then subject to French legislation applicable in civil aviation matters.
The Ministry of Civil Aviation ensures each airline’s compliance with civil aviation rules. In the event of failure to comply with the established rules, administrative sanctions are executed. At this stage, the intervention of a professional competent in aviation law is indispensable.
An attorney can help resolve the problems that many airlines experience when faced with administrative management. Numerous administrative penalties are instituted against airlines and may include the withdrawal of the operating license or the imposition of administrative fines.
Moreover, an airline seeking assistance from the local authorities can be accused of distorting competition. In this case, only the intervention of a lawyer can tackle such claims.
The withdrawal or suspension of an airline’s license
The Minister for Civil Aviation may, after consulting the High Council for aviation, at any time and in any case where it is clear that a licensed air carrier is experiencing financial hardship, conduct an assessment of its financial outcomes and may suspend or revoke the license if he or she doubts that the airline will be able to meet its current obligations for a period of twelve months.
The Minister may also issue a temporary license during the financial restructuring of an airline, provided that safety is not jeopardized.
Each year, without undue delay, airlines must furnish documentary evidence of their audited financial accounts of the previous year.
Before a decision to withdraw the license or AOC is made, the airline in question is permitted to offer commentary. At this stage, the effective intervention of a lawyer can reassure the authorities of the ephemerality of the carrier’s financial woes.
The intervention of a lawyer before the Supreme Council of the Board of Aviation will prevent the withdrawal or suspension of the operating license. Counsel will have already convinced the airline’s partners to maintain their support for the entity in question.
The reduction of administrative fines in the event of unjustified removal of time slots
Exercise of air transport activities in France is subject to the allocation of time slots to airlines. These time slots take into account the estimated time of arrival or departure available or allocated to an aircraft’s movement on a specific date at a coordinated airport.
Indeed, any landing or takeoff of an aircraft operated by an airline in a fully designated airport shall be, except in cases of force majeure, subject to the established slot allocations made by the corresponding coordinator of said airport.
An air carrier requesting a time slot at an airport on any day with less than four slots is considered a newcomer.
Airlines may therefore experience problems in respect to the assignation of their respective slots.
The Minister for Civil Aviation may impose an administrative fine against any airline flying with scheduled programming and marketing that does not correspond to a time slot for takeoff or landing specifically assigned for this purpose.
This charge is decided after consulting the Administrative Commission of Civil Aviation. This commission's assignment is to advise the Minister on the administrative penalties that may be imposed for any breach of regulation.
The airline accused of failing to maintain its slot then justifies its actions. The Administrative Commission of Civil Aviation considers, in addition to the rapporteur, the person or persons involved in the referral, which may be represented or assisted by an individual of their choosing.
The intervention of a lawyer before the Committee on Civil Aviation is essential. A lawyer charged with defending the interests of an airline can effectively convince the commission of the good faith of his client(s).
PICOVSCHI Law Firm has previously defended airlines before the Committee on Civil Aviation. We convinced the commission that the failure of slots resulted not from any bad faith of the airline, but rather from the unjustified removal of previously allocated time slots.
In fact, according to the policies of the Directorate General of Civil Aviation, when used properly, all time slots are automatically re-allocated to the companies charged with their operation. The airline operating an approved slot can claim the same slot for the duration of the scheduling period.
For this reason, the company whose interests we represent has maintained its flights in accordance with their normal schedule. Nevertheless, the authority responsible for slot allocation had assigned their slots to a competing airline.
In this case, the relevance of our observations of the Administrative Commission of Civil Aviation reduced the original amount of fines by tenfold!
The appreciation of the legitimacy of assistance granted to airlines
So as to encourage airlines to operate in local airports, resident authorities or chambers of commerce may grant financial aid. This assistance is designed to facilitate the integration of specific airlines into the regional fabric.
The difficulty stems from the fact that assistance may be challenged by other companies who believe that it distorts corporate rules of competition. The participation of a legal professional in negotiations for a settlement in the province can help guarantee that you will avoid many possible complaints from competitors.
The role of the lawyer is crucial insofar as they are capable of assessing the compatibility of financial assistance with the corporate market. Jurisprudence and decisions of national and European bodies are too complex for non-professionals to easily navigate.
In general, financial assistance may be compatible with the common market on the basis of transportation policy, insofar as it helps develop and ensure improved use of a secondary airport infrastructure which is currently underutilized and represents a cost to the community.
Nevertheless, some external aid can be deemed incompatible with the market because it distorts competition in favor of beneficiaries. In this case, the amount of aid granted must be repaid by the companies that have benefited from the funds. This can be catastrophic for the financial well-being of an airline.
The decision of the Commission dated February 3, 2004, illustrates this situation perfectly. The Commission approved certain grants that allow the true development of new airlines. In contrast, other aid has been deemed incompatible with the proper functioning of the internal market and therefore must be repaid.
In order to avoid these problems, it is important to request counsel from a French lawyer in Paris who can ensure that the benefits granted by an airport are not reclassified as acts of competitive distortion.
