Ryanair 2011 Annual Report Download - page 73

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European Commission. The European Commission is in the process of introducing a “single European
sky policy,” which would lead to changes to air traffic management and control within the EU. The “single
European sky policy” currently consists of the Framework Regulation (Reg. (EC) No. 549/2004) plus three
technical regulations on the provision of air navigation services, organization and use of the airspace and the
interoperability of the European air traffic management network. These regulations have recently been amended
by the so-called “Single European Sky II” regulation (EU Regulation 1070/09). The objective of the policy is to
enhance safety standards and the overall efficiency of air traffic in Europe, as well as to reduce the cost of air
traffic control services.
On September 6, 2005, the European Commission announced new guidelines on the financing of both
airports and start-up aid to airlines by certain regional airports based on its finding in the Charleroi case, a
decision that the CFI has since annulled. The guidelines only apply to publicly owned regional airports, and
place restrictions on the incentives that these airports can offer airlines to deliver traffic. Ryanair believes that
the CFI’s annulment of the Charleroi decision severely undermines these guidelines. In April 2011, the
European Commission launched a consultation on the revision of the 2005 guidelines. However, no assurance
can be given that the revised guidelines will better reflect the commercial reality of the liberalized air transport
market and consequently allow public airports to offer similar incentives to those offered by private airports.
The European Union also adopted legislation on airport charges (EU Directive 2009/12), which was
originally intended to address abusive pricing at monopoly airports. However, the legislation includes all
European airports with over five million passengers per year. Management believes that this will likely increase
the administrative burdens on smaller airports and may lead to higher airport charges, while the scope that exists
within this Directive to address abuses of their dominant positions by Europe’s larger airports is very limited.
See “Item 7. Major Shareholders and Related-Party Transactions Other Financial InformationLegal
ProceedingsEU State Aid-Related Proceedings.”
The European Union also passed legislation calling for increased transparency in airline fares, which
requires the inclusion of all mandatory taxes, fees, and charges in advertised prices. Ryanair currently includes
this information in its advertised fares in all markets where it operates. However, certain regulatory authorities
have alleged that some fees applied by airlines, including Ryanair, on an avoidable basis are in fact mandatory.
If Ryanair is ultimately unsuccessful in defending its position, it may be required to include such optional fees in
its advertised fares.
Registration of Aircraft
Pursuant to the Irish Aviation Authority (Nationality and Registration of Aircraft) Order 2002 (the
“Order”), the IAA regulates the registration of aircraft in Ireland. In order to be registered or continue to be
registered in Ireland, an aircraft must be wholly owned by either (i) a citizen of Ireland or a citizen of another
member state of the EU having a place of residence or business in Ireland or (ii) a company registered in and
having a place of business in Ireland and having its principal place of business in Ireland or another member
state of the EU and not less than two-thirds of the directors of which are citizens of Ireland or of another
member state of the EU. As of the date of this report, seven of the nine directors of Ryanair Holdings are
citizens of Ireland or of another member state of the EU. An aircraft will also fulfill these conditions if it is
wholly owned by such citizens or companies in combination. Notwithstanding the fact that these particular
conditions may not be met, the IAA retains discretion to register an aircraft in Ireland so long as it is in
compliance with the other conditions for registration under the Order. Any such registration may, however, be
made subject to certain conditions. In order to be registered, an aircraft must also continue to comply with any
applicable provisions of Irish law. The registration of any aircraft can be cancelled if it is found that it is not in
compliance with the requirements for registration under the Order and, in particular: (i) if the ownership
requirements are not met; (ii) if the aircraft has failed to comply with any applicable safety requirements
specified by the IAA in relation to the aircraft or aircraft of a similar type; or (iii) if the IAA decides in any case
that it is not in the public interest for the aircraft to remain registered in Ireland.
Regulation of Competition
Competition/Antitrust Law. It is a general principle of EU competition law that no agreement may be
concluded between two or more separate economic undertakings that prevents, restricts or distorts competition
in the common market or any part of the common market. Such an arrangement may nevertheless be exempted
by the European Commission, on either an individual or category basis. The second general principle of EU