The International Air Transport Association (IATA), in collaboration with Deloitte, has published a new set of guidelines for governments to facilitate the growth of air connectivity by laying down clear rules for the privatisation of airports.
The new Airport Ownership and Regulation guidance has been prepared considering the public-private partnerships (PPP) and other forms of privatisation programmes for airport infrastructure.
IATA director general and CEO Alexandre de Juniac said: “Airports provide critical infrastructure. It is important that governments considering privatisation or PPP take a long-term view and focus on solutions that will maximise the economic and social benefits of connectivity.
“The aim of Airport Ownership and Regulation is to help governments make better-informed decisions using best-practices gleaned from decades of experience with the good, the bad and the ugly of airport privatisations.”
IATA’s new guidance focuses on three key areas including assessing the options for models of privatisation, best practices for the process of privatisation, and regulation of privatised airports.
Governments are required to take a broad view of airport ownership and operating models, by matching them to the strategic management, financial and macro-economic objectives of inviting private participation in airport infrastructure provision and management.
Additionally, they need to use a competitive and transparent transaction process to assure public value for money.
Bids must be assessed on balanced criteria and the important terms of any concession contract must ensure an improvement in the quality of service and appropriate investment in the airport.
Furthermore, the report highlights the need for the assessment of an airport’s market power and the development of the appropriate regulatory framework, which must be done simultaneously with evaluation of potential ownership and operating models.
Deloitte global airport lead Dorian Reece said: “There is a critical need to ensure strategic objectives are appropriately assessed and the benefits and risks understood when evaluating airport ownership and operating model options.
“Whatever ownership or operating model is applied, governments, investors and aviation stakeholders need to put the end-consumer central to the selection of the optimal solution.”