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About two weeks ago, the government withdrew the draft amendments to the Aviation Law from the parliamentary proceedings, informing that a revision should be expected. Currently, the document is being worked on at the CAO and the Ministry of Infrastructure. Yesterday (16^th December 2009), it was reported on the CAO's website that consultations had started on the principles of an airport fees regulation system at Polish airports. These consultations will continue until 8 January 2010. In the meantime, the airline industry is alerting on the consequences of the changes in law as proposed by the government.

According to the calculations made by airlines, the incorporation of the changes proposed by the CAO will result in annual expenses of ca. 90 million in the market. Of this amount, 30-40 million zlotys will go to the CAO while the remaining ca. 55 million will be additional expenses of the airports. Anyway, all these costs will be eventually paid by passengers.

On 10^th November 2009, Air Italy and PLL LOT submitted a joint proposal on the changes in the draft act on the modification of the aviation law with respect to non-schedule operations. The revision announced by the government was supposed to account for the airlines' demands. However, none of these has been complied with in the proposal published by the CAO on 16^th December. It is not clear whether the presented document is a joint proposal of the CAO and the Ministry or just the CAO's standpoint.

The existing legal regulations for the charter flight sector in Poland are incompatible with the current market situation. The current policy promotes a fully liberal market, i.e. where carriers that have not been licensed in Poland have unlimited access to the market with no investment requirements. In 2008, the airlines holding a license issued by the President of the Civil Aviation Office carried ca. 620 thousand passengers in total, which was a share of 22% in the whole charter flight market - one of the lowest such rates in Europe. This means that more than 80% of the 3 billion zlotys worth charter flight market is held by airlines that do not pay any taxes in Poland and do not employ Polish staff.

In reference to the proposal presented by the CAO, Mr Mariusz Szpikowski said at the meeting that "our shared goal (i.e. Air Italy's and PLL LOT's) is to have such regulations implemented that will offer Polish charter carriers an opportunity of dynamic growth, contributing to market protection and creating new jobs in the airline industry, as well as ensuring income for the Budget".

Stanisław Lamczyk, a PO member of Parliament, remarked that "thorough changes in the Aviation Act are absolutely necessary and it is very important to ensure that they are to the interest of Poland. Such economic segments as charter flights may significantly contribute to the Budget. Total liberalization will result in the revenues from the unlimited exploitation of the market by foreign entities, that have no investment requirements imposed on them, flowing to the countries of their registration."

The suggestion to hand over airport security control to private enterprises that will be supervised by the CAO is also very controversial. As Michał Wojtkiewicz, a PiS member of Parliament, emphasized: "The airports are in fact state borders. We cannot allow for the state borders to be guarded by unqualified organizations, especially now that the risk of terrorist attacks is so high."

"We suggest that Polish regulations allow for free access to this market by such carriers which will make investments in the development of technical facilities and labour market in Poland. The implementation of the proven solutions, in place in other EU Member States, based on precedence and reciprocity would encourage international companies to open their branch offices in Poland and contract Polish employees and suppliers. Such new regulations would also provide benefits to airports, with licensed organizations developing its own infrastructure and creating new jobs. It should also be noted at this point that the new carriers which will obtain a license in Poland are going to bring revenues to the Budget in the form of taxes and other fees. Therefore, it will no longer be necessary to increase airport fees or impose other taxes on individuals", said Mariusz Szpikowski.

Another issue, closely connected with the air transport market, is the change in the method of financing the Civil Aviation Office by cutting off Budget donations and having the Office financed entirely from the fees and charges collected in the market. While the main reason behind this idea seems obvious: the government is trying to solve the problem of budget deficit (as the state expenses exceed its incomes), the method strikes the entire airline industry with horror. The Office would be financed mainly by increasing the rates and fees. In addition to the draconian amounts of the new rates, their range and lack of clarity as to the basis on which they are going to be determined is indeed terrifying to all the businesses concerned. The most glaring example here is the proposed fee for the supervision of business activity in aviation (Art. 25 item 2  (e)) which would range between PLN 1,400 and PLN 2,000,000. Under the current law this fee is PLN 500 for small airlines, PLN 1,500 for medium carriers and PLN 3,000 for the big ones. Now this fee is precisely defined while in the proposed version the decision is entirely at the discretion of an official, the basis for such decision unknown.

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Air Italy Polska is a member of Air Italy Group. This carrier operates short and long distance charter flights. Air Italy Polska, with its base in Warsaw, cooperates also with regional airports.

For Air Italy Polska, the principal business guidelines are: keeping high safety standards, on-time performance and quality of services, as well as making sure that our partners do so.