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Clause 18 - Licence conditions

Part of Civil Aviation Bill – in a Public Bill Committee at 2:30 pm on 1st March 2012.

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Photo of Theresa Villiers Theresa Villiers The Minister of State, Department for Transport 2:30 pm, 1st March 2012

I am grateful to, you, Sir Roger, for allowing a short exchange on clause stand part, but I will not delay the Committee extensively. As you have indicated, we have had a wide-ranging debate. I start by confirming that the reference to “section 1” in clause 18 is to what is currently clause 1, so it refers to the primary duty to end users.

There is one remaining issue on clause 18: as we discussed this morning, the Competition Commission has the power, at present, to order divestment in relation to airports. I want to share with the Committee that it is not, and never has been, the Government’s intention to extend that power to the CAA. We do not intend to give the CAA the power to require divestment of airport  facilities. A query has been raised, however, on whether the licensing powers in the clause could, in theory, be used by the CAA to force the divestment of airport facilities, such as a terminal. We are giving careful consideration to that issue, and will continue to do so, but to provide reassurance, I refer the Committee to the better regulation obligations on the CAA in clause 1(4). Those principles oblige the CAA to carry out its regulatory activities in a proportionate way, as we have discussed.

Our strong view is that even if clause 18 could, in theory, be used to order divestment, the Government are not convinced that it would ever be a proportionate, appropriate response for the CAA, having regard to the limits on its role set out in the statutory framework and the scope of its licence-making powers. That is in contrast to the much broader remit of the Competition Commission, which has very wide-ranging powers to assess fundamental structural problems across different markets and conduct far-reaching investigations, including on matters such as divestment.

The Competition Commission’s role, therefore, goes beyond the defined, targeted focus of the CAA’s statutory function. Moreover, even if the CAA saw a case for divestment, the obvious option would be to make a reference to the Competition Commission as the body with the obvious remit to cover a change of such magnitude.