Dáil debates

Tuesday, 21 March 2006

Aviation Bill 2005 [Seanad]: Report and Final Stages.

 

5:00 pm

Photo of Rory O'HanlonRory O'Hanlon (Cavan-Monaghan, Ceann Comhairle)
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Amendments Nos. 1, 2, 3, 5 and 11 are related and will be discussed together.

Photo of Róisín ShortallRóisín Shortall (Dublin North West, Labour)
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I move amendment No. 1:

In page 3, between lines 21 and 22, to insert the following:

"2.—Nothing in Section 40 (13) the Air Navigation & Transport (Amendment) Act 1998 shall (i) permit the detention or sale of any aircraft that is not owned by the operator who is liable for the charge or (ii) prejudice any right of a Company to recover any charges, or any part thereof, by action. Any sale ordered under this section shall be on such terms as to preserve the priority and interests of any third parties with an interest in the aircraft or any part of it (including equipment, stores and documents) at the time the aircraft was detained.".

There has been considerable debate on this aspect of the Bill and its shortcomings in the Seanad and on Committee Stage. I hope that as the Minister of State has now had an opportunity to reconsider his position, he might agree to the amendments tabled by Deputy Olivia Mitchell and me.

Many concerns were expressed regarding this Bill by aircraft leasing companies and aircraft maintenance and repair organisations because it will make it easier for Eurocontrol to take action against the customers of both types of company. The Bill puts Ireland at a competitive disadvantage by allowing Eurocontrol to go further here than in any other country in terms of providing it with powers to seize and dispose of aircraft. As Eurocontrol is already very successful in collecting unpaid fees, why should such additional powers be provided in Ireland? On Committee Stage, the Minister of State made the point that it would act as a deterrent. However, the existing powers already do so and there is nothing to indicate that any further deterrents are required or would be provided by the provisions of this Bill.

Under these proposals and given the international nature of the industry, Irish aircraft owners could find themselves being sued before a foreign court. Any statements made by the Minister of State in the House or on Committee Stage would be of no value because what matters is not how the Minister of State may wish the Bill to be construed but how it is actually construed. It seems extraordinary that no cognisance will be taken of the rights of aircraft maintenance companies and aircraft leasing companies in respect of the principles regarding private property.

On Committee Stage, I remarked that the provisions of this Bill are akin to giving the ESB the power to seize the house of a landlord whose tenant has not paid his or her ESB bill. It is exactly the same as that scenario. This constitutes interference with the private property rights of owners of aircraft, or in my example, landlords, because people with whom they do business have defaulted on paying a bill. This is what the Minister of State proposes.

In natural justice, I cannot see how such proposals stand up. Undoubtedly, if the Minister of State proceeds along these lines, the legislation will be challenged in the courts. I hope he has had time to reconsider this matter, that sense will prevail in this regard and that he will accept these amendments.

Photo of Olivia MitchellOlivia Mitchell (Dublin South, Fine Gael)
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This issue has been debated at some length in the Seanad and in this House on Second and Committee Stages. I again, with Deputy Shortall, make this plea on Report Stage. We genuinely believe that a significant wrong will be included in this Bill. It is contrary to natural justice. I tabled a composite amendment to the effect that no liability would be created on the owner of an aircraft unless that owner was also the operator. There should be no lien on an aircraft in circumstances where the operator reneges on fees to either Eurocontrol or an airport. There should be no grounding of an aircraft unless the offender is both the owner and the operator, and neither airports nor Eurocontrol should be given the power to sell aircraft unless the person who reneges on the bill is also the operator.

If Members allow this situation to pertain, they will merely allow tardy and sloppy debt collection on behalf of airports and Eurocontrol which has had few problems in collecting bills. As my colleague, Deputy Shortall, noted, this runs counter to natural justice. It makes no sense to go beyond what is required to comply with the regulation.

I made a similar point in respect of property rights on Committee Stage. Deputy Shortall used the analogy of an ESB bill. I used the example of renting a car where a person may be fined for an offence such as speeding. In a case such as this, the Garda could take the car, even though it was rented. It makes no sense to give this kind of power to either Eurocontrol or the airports and it goes far beyond what is permissible under company law for other sectors.

Moreover, as this goes beyond what the laws in other countries require in similar circumstances, we will penalise our own aviation sector. We will penalise those who lease aircraft or manufacture aircraft parts as well as those who are involved in repair or maintenance. In addition, this measure will make Ireland an unattractive place for planes to land because it exposes them to being grounded, put up for sale to pay bills or debts, or used against money that is outstanding. Hence, we will penalise ourselves as well as the tourism industry and the air freight business. In other words, this will create a competitive disadvantage relative to every other European country.

Even at this late stage, I ask the Minister of State to go back to the drawing board and reconsider this provision. I am also convinced that there will be constitutional challenges to this measure based on property rights. We should get this right now. Why put an industry that we value, or say we value, at an unnecessary disadvantage?

Photo of Pat GallagherPat Gallagher (Donegal South West, Fianna Fail)
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This amendment and amendments Nos. 2, 3, 5 and 11 are being taken together.

The Deputies are quite correct. This matter was debated at length on both Second Stage and Committee Stage. All of these amendments arise from concerns about the powers of detention and sale of aircraft for non-payment of airport, air navigation and communications charges.

We have taken a policy decision not to impose the provisions of the revised Eurocontrol Convention concerning joint and several liability in the case of unpaid Eurocontrol en route charges. We are not providing in this Bill for those provisions in Annex IV of the revised convention relating to this matter. I assure Deputies Olivia Mitchell and Shortall that the passage of this Bill in its current form will not increase our current powers relating to detention and sale of aircraft for unpaid charges. There may be a perception that we are doing something new. I will clarify the position and give the facts. These provisions have been in place since 1988. It has been suggested that this may be unconstitutional and it may be challenged.

I acknowledge that, in addition to Deputies Mitchell and Shortall voicing concern, a number of leasing companies also voiced concerns about the powers in earlier Acts dating from 1988 and asked, as the Opposition spokespersons to whom I refer did, that these be modified in the Air Navigation (Eurocontrol) Bill 2005. As a result of this and the contributions of the Deputies, I consulted the Attorney General's office and other interested parties such as the Irish Aviation Authority, the Dublin Airport Authority and Eurocontrol. All argued against the removal or dilution of the existing powers of detention and sale.

Photo of Olivia MitchellOlivia Mitchell (Dublin South, Fine Gael)
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Of course they did.

Photo of Pat GallagherPat Gallagher (Donegal South West, Fianna Fail)
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I am advised that the detention and sale provisions in Irish law are similar to those in UK law. Both are common law systems. Eurocontrol have also advised that Greece has a detention procedure and that Cyprus has legislation which will become effective on the entry into force of the revised convention which provides for detention of aircraft until judicial measures are taken against the operator and-or owner.

Photo of Olivia MitchellOlivia Mitchell (Dublin South, Fine Gael)
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That is outrageous.

Photo of Pat GallagherPat Gallagher (Donegal South West, Fianna Fail)
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In addition, Eurocontrol has indicated that member states that have civil law systems have similar powers to seize aircraft for non-payment of debts. All of these procedures, whether under common or civil law, have the same effect of freezing the asset in question and making it available as a security for the payment of a debt.

While I gave further consideration over the past ten days to the points raised by Deputies Mitchell and Shortall, I regret that I am unable to accept the amendments proposed and I will repeat a number of reasons for that. First, there is a safeguard for an owner in the selling of the aircraft for the purposes of meeting a debt to Eurocontrol in respect of liability of an operator. To sell an aircraft an application must be made to the High Court and the registered owner would have to be on notice of any proposed sale.

Second, it is not a procedure that has been resorted to lightly in the past. In fact there has been no instance in the past, from 1988 to date, where an aircraft has been detained and subsequently sold due to non-payment of a debt to Eurocontrol. I would make clear, however, that the existence of these powers is regarded as having a significant deterrent effect.

Third, the aircraft leasing companies can afford themselves financial protection by building provisions into their lease agreements with these aircraft operators. This facility is not available to the air traffic control provider when doing business with airlines. In practice an aircraft lessor is usually in a better position than an airport authority or air traffic control provider to monitor the financial status of the operator as it can specify any necessary requirements under the aircraft lease. Furthermore, any amendment to the legislation that would give rise to different legal treatment of leased versus owned aircraft would be inappropriate.

The provisions apply equally to debts incurred by airline companies for Eurocontrol charges or for airport charges. Any change in the legislative provisions relating to Eurocontrol charges would give rise to different treatment of air navigation and airport charges. This would lead to arbitrary discrimination between service providers to airlines and would not be appropriate.

Following consideration of all the views expressed by Members of the House, and by the Irish Aviation Authority, the Attorney General's office and the Dublin Airport Authority, I have decided not to make any changes to the existing powers at this point. We are not making any changes in legislation. This would not make it any more unattractive for aircraft to land in Ireland. It did not have that effect from 1988 to date and I do not see it having that effect in the future. I have looked at this seriously and taken on board all of the recommendations made to me. Regrettably, I am unable to accept the amendments, which I believe were tabled in good faith.

Photo of Róisín ShortallRóisín Shortall (Dublin North West, Labour)
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There is not much point in repeating comments made on Committee Stage. The Minister of State made these five points on Committee Stage and they all were refuted. He is merely repeating them here again today. There is no point in pursuing it. It is regrettable that the Minister of State has decided not to concede any of these points, not to listen to the industry, who are extremely concerned about its impact on business here. There is a real risk that this will be challenged. I wish to press the amendment.

Photo of Olivia MitchellOlivia Mitchell (Dublin South, Fine Gael)
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The fact that it has not impacted negatively since its introduction does not mean that it is not a timebomb waiting for us. All it takes is one example of a grounded aircraft for Ireland to become a no-go area for other aircraft. That is the danger. It is not that it has not happened so far, but that it may happen and if so, we will become the pariah of the aviation industry. This is an important issue and I very much regret that it is not being taken on board.

Photo of Pat GallagherPat Gallagher (Donegal South West, Fianna Fail)
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I have nothing further to add.

Amendment put.

The Dail Divided:

For the motion: 52 (Bernard Allen, Dan Boyle, James Breen, Tommy Broughan, Richard Bruton, Joan Burton, Paul Connaughton, Joe Costello, Jerry Cowley, Seymour Crawford, Seán Crowe, John Deasy, Jimmy Deenihan, Bernard Durkan, Olwyn Enright, Martin Ferris, Eamon Gilmore, Marian Harkin, Séamus Healy, Joe Higgins, Michael D Higgins, Brendan Howlin, Paul Kehoe, Kathleen Lynch, Pádraic McCormack, Shane McEntee, Finian McGrath, Paddy McHugh, Liz McManus, Olivia Mitchell, Catherine Murphy, Denis Naughten, Dan Neville, Caoimhghín Ó Caoláin, Fergus O'Dowd, Jim O'Keeffe, Brian O'Shea, Jan O'Sullivan, Séamus Pattison, Willie Penrose, John Perry, Ruairi Quinn, Pat Rabbitte, Michael Ring, Seán Ryan, Joe Sherlock, Róisín Shortall, Emmet Stagg, Billy Timmins, Liam Twomey, Mary Upton, Jack Wall)

Against the motion: 66 (Bertie Ahern, Dermot Ahern, Michael Ahern, Barry Andrews, Seán Ardagh, Johnny Brady, Martin Brady, John Browne, Joe Callanan, Ivor Callely, Pat Carey, John Carty, Donie Cassidy, Beverley Flynn, Mary Coughlan, Martin Cullen, John Curran, Noel Davern, Noel Dempsey, Tony Dempsey, John Dennehy, Jimmy Devins, John Ellis, Frank Fahey, Dermot Fitzpatrick, Seán Fleming, Pat Gallagher, Jim Glennon, Noel Grealish, Seán Haughey, Máire Hoctor, Joe Jacob, Billy Kelleher, Peter Kelly, Tony Killeen, Séamus Kirk, Tom Kitt, Brian Lenihan Jnr, Conor Lenihan, Michael McDowell, Tom McEllistrim, John McGuinness, John Moloney, Michael Moynihan, Michael Mulcahy, M J Nolan, Éamon Ó Cuív, Seán Ó Fearghaíl, Charlie O'Connor, Willie O'Dea, Liz O'Donnell, John O'Donoghue, Denis O'Donovan, Noel O'Flynn, Ned O'Keeffe, Fiona O'Malley, Tom Parlon, Peter Power, Seán Power, Dick Roche, Mae Sexton, Michael Smith, Dan Wallace, Mary Wallace, Joe Walsh, Michael Woods)

Tellers: Tá, Deputies Kehoe and Stagg; Níl, Deputies Kitt and Kelleher.

Amendment declared lost.

Photo of Róisín ShortallRóisín Shortall (Dublin North West, Labour)
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I move amendment No. 2:

In page 3, between lines 21 and 22, to insert the following:

"2. — Ireland's ratification of the protocol is subject to a reservation in relation to Articles 5, 6 and 9 of Annex IV ("Provisions Relating to the Common Route Charges System") in that Ireland declares that the provisions for the lien or the joint and several liability (under Article 5) and the detention and sale of aircraft (including equipment, spare parts, fuel, stores and documents) other than those legally and beneficially owned by the operator that is liable for the charge (under Articles 6 and 9) shall not apply.".

Amendment put and declared lost.

Photo of Olivia MitchellOlivia Mitchell (Dublin South, Fine Gael)
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I move amendment No. 3:

In page 4, between lines 32 and 33, to insert the following:

"(c) in section 43 by adding the following new subsection (3):

"(3) Nothing in this section shall create a liability on the owner of an aircraft unless that owner was also the operator of the aircraft at the time the charge was incurred, except where the owner is unable to establish that some other person was the operator at that time.",".

Amendment put and declared lost.

Amendment No. 4 not moved.

Photo of Róisín ShortallRóisín Shortall (Dublin North West, Labour)
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I move amendment No. 5:

In page 5, between lines 5 and 6, to insert the following:

"(a) in section 43(2), by inserting "Nothing in this section shall create a liability on the owner of an aircraft unless that owner was also the operator of the aircraft at the time the charge was incurred, except where the owner is unable to establish that some other person was the operator at that time.",".

Amendment put and declared lost.

Séamus Pattison (Carlow-Kilkenny, Labour)
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Amendment No. 6 is being recommitted. As amendments Nos. 7, 8 and 9 are consequential, these amendments will therefore be discussed together.

Bill recommitted in respect of amendments Nos. 6 to 9, inclusive.

Photo of Pat GallagherPat Gallagher (Donegal South West, Fianna Fail)
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I move amendment No. 6:

In page 8, line 39, to delete "or".

This amendment is grouped with amendments Nos. 7, 8, and 9 which refine the technical amendments to section 40 of the Aviation Regulation Act 2001. These original technical amendments related to the consideration of appeals of airport and aviation terminal charges determinations made by the Commission for Aviation Regulation. The amendments made on Committee Stage to section 40 of the Act extended the maximum time available to the appeal panel established under that section to consider an appeal from two months to three months. They also extended the time available to the Commission for Aviation Regulation to consider any matter referred back to it by the appeals panel from one month to two months.

There was a further amendment to section 13 of the Aviation Regulation Act 2001 to cover a situation where an appeal panel referred to the Commission for Aviation Regulation took place when the commissioner's post was vacant. The purpose of this further amendment, amendment No. 6, provides that in the event of a commissioner starting consideration of an appeal panel referral but being unable, through incapacity for example, to decide on an appeal within the proposed two-month statutory period, the appeal can be decided by the deputy commissioner or another commissioner. While this may be a remote circumstance, it is considered preferable to address it to avoid any doubt.

Amendment agreed to.

Photo of Pat GallagherPat Gallagher (Donegal South West, Fianna Fail)
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I move amendment No. 7:

In page 8, line 44, to delete "appointed." and substitute "appointed, or".

Amendment agreed to.

Photo of Pat GallagherPat Gallagher (Donegal South West, Fianna Fail)
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I move amendment No. 8:

In page 8, after line 44, to insert the following:

"(c) where a commissioner is appointed within the period referred to in paragraph (a) but due to his or her incapacity to act as a commissioner or ceasing to be a commissioner before making the decision within the period of 2 months referred to in subsection (8)—

(i) within that period of 2 months, by the deputy commissioner, or

(ii) if another commissioner has been appointed within the period referred to in subsection (8), by the other commissioner within that period.".

Amendment agreed to.

Photo of Pat GallagherPat Gallagher (Donegal South West, Fianna Fail)
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I move amendment No. 9:

In page 9, line 3 to delete "(8A)(b)" and substitute "(8A)(b) or (c)(i)".

Amendment agreed to.

Bill reported with amendments.

Séamus Pattison (Carlow-Kilkenny, Labour)
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Amendment No. 9a is in the name of the Minister. Amendment No. 10 is an alternative and will be discussed with it.

Photo of Pat GallagherPat Gallagher (Donegal South West, Fianna Fail)
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I move amendment No. 9a:

In page 11, to delete line 40 and substitute the following:

"6. — Paragraphs (a), (b) and (c) of section 67 of the Act of 1993 are repealed.".

This amendment is grouped with amendment No. 10 which was proposed by Deputy Shortall. Following consideration of Deputy Shortall's amendment on Committee Stage, I have had the matter re-examined by the Parliamentary Counsel. The principle outlined in Deputy Shortall's amendment has now been accepted, but her specific wording has not. I take this opportunity to thank Deputy Shortall for highlighting this issue. I ask her to withdraw her amendment in favour of amendment No. 9a. In principle it does the same as her amendment, but I am advised the wording in amendment No. 9a is more acceptable.

Photo of Róisín ShortallRóisín Shortall (Dublin North West, Labour)
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I am happy to do that.

Amendment agreed to.

Amendments Nos. 10 and 11 not moved.

Bill, as amended, received for final consideration.

Question proposed: "That the Bill do now pass."

6:00 pm

Photo of Pat GallagherPat Gallagher (Donegal South West, Fianna Fail)
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I thank the Deputies who have contributed to this debate and to the passage of the Bill through the House, in particular Deputies Shortall and Olivia Mitchell who have taken such an interest in it. I thank them and other Deputies who have contributed for their support and understanding and for their acceptance of amendments concerning the employee share ownership scheme for Aer Lingus and the appeals process regarding decisions of the Commission for Aviation Regulation.

After the House formally agrees this Bill, it will return to the Seanad with the amendments approved by the House.

Enactment of the Bill will allow Ireland to ratify the revised Eurocontrol convention which will provide for the necessary institutional reforms required to achieve a uniform European air traffic management system for the control of general air traffic in European airspace and airports. This revised convention seeks to provide for a more effective air traffic management institutional policy and decision-making structure for Europe, with the overall objective of increasing airspace capacity and reducing air traffic control delays.

Cuirim mo bhuíochas in iúl do na Teachtaí as ucht an chomhoibrithe eadrainn i rith na Dara agus Tríú Céime den Bhille. Tá súil agam go mbeidh an Bille fíorthábhachtach seo tríd an Oireachtas tar éis na seachtaine seo chugainn.

Photo of Olivia MitchellOlivia Mitchell (Dublin South, Fine Gael)
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I said on Second Stage that the public at large had no idea we were discussing this Bill and could not care less. While it is arcane, technical and not easily grasped by the majority of people who have no interest in aviation or how it is organised, nevertheless it is important legislation for the aviation industry and for every one who travels by air. Eurocontrol does a very important job on our behalf. I thank those involved in drafting the Bill, a job I would not envy in any way. I agree with the Minister of State that the copperfastening of the shareholding for Aer Lingus is an important measure, to put a belt and braces on it, as it were. I thank the Minister of State for his courtesy, particularly as he took over this Bill mid-stream, which is no easy matter, and all the staff involved.

Photo of Róisín ShortallRóisín Shortall (Dublin North West, Labour)
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I join Deputy Mitchell in thanking the Minister of State and his officials for their work in preparing this legislation and seeing it through the House.

Question put and agreed to.

Séamus Pattison (Carlow-Kilkenny, Labour)
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The Bill, which is considered to be a Dáil initiated Bill, in accordance with Article 20.2.2° of the Constitution, will be sent to the Seanad.