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Annual Report | Reports/Papers | MOU with ACCC | Email Notification Annual Report - 2006-2007Review by ChairmanI am pleased to report on a year of successful results for the Commission in its fifteenth year of operations. There was much diversity in our activities this year. Australia will have two new international airlines, following decisions taken by the Commission. During the year, the Commission allocated capacity to Queensland Regional Airlines for it to operate services between Cairns and Papua New Guinea. After detailed consideration of the airlines application, the Commission found the carrier to be reasonably capable of obtaining the necessary operating approvals and of implementing its proposal. Queensland Regional Airlines is expected to start daily services late in 2007, using a de Havilland Dash8 turboprop aircraft. Although its operations are not large in scale, this new airline will provide important competition on the Papua New Guinea route. During the year, the Virgin Blue group kept the Commission advised informally of its plans to commence long haul international services between Australia and the United States. In a significant development post-30 June 2007, the Commission received an application from Virgin Blue International Airlines for capacity to operate B777-300 services on the South Pacific route between Australia and the United States from November 2008. The Commission allocated capacity to the airline in July. This important decision will be the subject of more detailed reporting in next years annual report. The Commission made several decisions enabling the further expansion of Jetstar on Australias international routes. During the year Jetstar, a wholly-owned subsidiary of Qantas, successfully entered several new overseas markets, taking advantage of rights provided to it by the Commission last year. Jetstar has replaced Australian Airlines as Qantas overseas subsidiary operator, with Australian Airlines having ceased operations in July 2006. As a result of the Commissions further decisions this year, Jetstar will be able to extend its network reach into new markets in Asia. Qantas was granted rights by the Commission to expand its own passenger services to various countries, including Malaysia, China, Canada and Vanuatu. In recent years, Qantas has increased its presence in international freight markets and this trend continued in 200607 with the Commission allocating to Qantas unlimited freight capacity for operations on the United Arab Emirates route. Also in the freight arena, the Commission allocated twenty five tonnes of freight capacity per week to HeavyLift Cargo Airlines on the Solomon Islands route. This airline now operates a network of all-cargo services within the south-west Pacific region. Over the course of the year, the Commission renewed a number of determinations which were due to expire, in response to requests from airlines for renewal. It also amended or revoked various existing determinations in response to applications from carriers. In total, the Commission made forty five determinations and decisions during the year. This compared with a total of forty nine last year. An important area of the Commissions work this year concerned applications by Qantas and Jetstar to code share with each other and with other international airlines. The policy statement given to the Commission by the Minister for Transport and Regional Services sets out the expectation that the Commission would normally authorise applications by Australian carriers to code share with other airlines. However, in cases where the Commission considers that a code share proposal raises significant competition concerns, it may subject the application to detailed examination. The Commission approved code sharing between Qantas and Jetstar on several routes in Asia. It also authorised code sharing by Japan Airlines on Jetstars services to Japan. Qantas was granted approval to code share with foreign carriers on routes to Hong Kong, Korea, Singapore and Thailand. There were two applications for code sharing which the Commission subjected to detailed public benefit examination. The first application was from Qantas, to continue code sharing with South African Airways on the South Africa route. Under the arrangements between these two airlines, Qantas flies between Sydney and Johannesburg, while South African Airways operates between Perth and Johannesburg. Each airline buys a block of seats on the other carriers flight. This enables both operators to sell seats to passengers for travel between Johannesburg and either of the two Australian cities. After careful assessment, the Commission granted authority for this code share arrangement to continue until 31 December 2007. More details about this important case are contained in the body of this report. The second major code share review related to code sharing between Qantas and Air Niugini on the Papua New Guinea (PNG) route. The Commission was aware that PNGs Independent Consumer and Competition Commission (ICCC) had decided to review the code share arrangements in 2007. As the Commissions existing authorisation of the arrangements was due to expire on 30 June 2007, the IASC invited the ICCC to work together in reviewing the arrangements concurrently. The ICCC accepted this invitation and the two authorities have enjoyed a constructive and beneficial working relationship in conducting their respective reviews in parallel. As at 30 June, the review process was well advanced, with draft decisions expected to be published by both Commissions early in 2007/08. In May 2007, the Commission granted an interim extension from 30 June 2007 to the end of February 2008 for Qantas and Air Niugini to continue code sharing while the joint review process was being carried out. At years end, we invited our clients to provide feedback on our performance against the standards in our service charter. The responses were very positive. In February 2007, Dr Michael Lawriwsky left the Commission following the completion of his third three-year term of appointment. Dr Lawriwsky has the distinction of being the longest serving member of the Commission and I thank him for his outstanding contribution to the work of the Commission over such an extended period. It was a pleasure to have worked with Dr Lawriwsky during my time as Chairman. It was also a pleasure to welcome Ms Philippa Stone on her appointment as a member of the Commission on 2 July 2007, just after the end of the financial year covered by this report. I am sure that Ms Stone, a partner in a prominent Australian legal firm, will make a fine contribution to the Commissions work. In concluding, I join with my fellow Commissioners, Ms Fanning and Ms Stone, in thanking the members of the Secretariat for their excellent advice and support throughout the year. We look forward to the challenges of 2007/08. John Martin Chairman
PDF VersionThe Commission's Annual Report is available in PDF format for easy download and printing. The document reflects the information in the hardcopy of the annual report tabled in Parliament on the 17 January 2008.
Previous IASC Annual Reports
Reports/PapersResearch PapersDuring 1996 and 1997, the IASC researched a number of issues relating to the allocation of capacity to Australian carriers. These matters included:
Download a copy of the Research Papers which can be viewed using MOU with ACCCMemorandum of Understanding (MOU) between the IASC and the ACCCA new MOU was signed with the Australian Competition and Consumer Commission (ACCC) on 9 December 1997. It replaces the MOU of 7 August 1996. The new MOU clarifies the roles of the IASC and the ACCC when assessing competition issues associated with applications to the IASC for Australian air route capacity, particularly when examining commercial agreements between airlines. The intention of the MOU is to coordinate the competition objectives of the two bodies and to avoid overlap and duplication. The MOU reflects the Policy Statement issued by the Minister for Transport and Regional Development in April 1997 which sets out matters relevant to the IASC's performance of its functions. The ACCC is an independent body which promotes competition and fair trading and provides for consumer protection Download a copy of the MOU which can be viewed using Email NotificationThe Commission provides an email notification service for interested parties. The full version includes copies of applications, determinations and decisions in Acrobat format. A shorter version of this service is an email notification of new applications, determinations or decisions. If you require either version of the email notification, please send an email to IASC@infrastructure.gov.au indicating the version you would like to receive and an indication of your interest and/or organisation. The Commission maintains a Register of Public Documents for all applications. Copies of virtually all documents placed on the Register are available by email from the Commission for an annual charge of $250 (from 1 July 2000). Commission's File ListsIn accordance with the requirement for tabling of indexed file lists in the Senate as varied by Senate Continuing Order No 5, the International Air Services Commission's file list for 1998 to 2003 are available.
Register of Available CapacityThe Government, through the Department of Infrastructure, Transport, Regional Development and Local Government, continues to have the responsibility for administering and negotiating Australia's air services arrangements. In this role, the Department is responsible for maintaining a Register of Available Capacity for use by the Commission and applicants. This register details the capacity available under each air services arrangement, and is updated to reflect changes in capacity entitlements arising from new negotiations and determinations by the Commission. The Department is also responsible for making operational decisions that authorise carriers to fly on each route based on the Commission's determinations. Contact DetailsFor further information about the Commission, please contact:
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(PDF: 4.6 MB)