For certain ports and airports, particularly Shannon Airport, the non-EU traveller is an important source of revenue. The other State airports also handle traffic to and from non-EU locations, including the important and welcome visitors who come here from Iceland.
As regards EU travellers, the EU has decided as part of the package of Single Market measures adopted in 1992 to allow the continuation of duty free and tax free sales for intracommunity travellers only until 30 June 1999. This was agreed as part of a comprehensive series of Single Market tax measures, including substantial changes to the entitlements of travellers to bring in tax paid goods more freely. From 1 January 1993, travellers from EU countries benefited from enhanced entitlements to import items tax paid from other EU states and easier border controls. This continuation to end June 1999, set out in Directives 91/680/EEC and 92/12/EEC, was agreed to allow the duty free operators, including Aer Rianta, time to diversify their activities. It had been originally planned that duty and tax free sales would end in January 1993 for EU travellers and the duty free operators were well aware of this intention for many years before that. The extension to 1999 was in response to requests for more time to adapt and that extension was reluctantly agreed to by the Commission on the basis of an entirely new system of vendor control of duty free sales and with the legal position being that EU duty free would end in 1999.
This new system of vendor control was to be subject to review by the Commission as it was a very substantial change from the previous arrangements based on customs controls, which became unworkable in a Single Market context, with much reduced frontier formalities, including the creation of special Blue Channels for EU passengers. From indications from the Commission, it seems that it has not been entirely happy with how the vendor controls have operated.
I stress that the decisions to end duty free in 1999 are firm ones that have been taken by the Council and enacted in Community law some considerable time ago, not proposals from the Commission which have still to be adopted by Council. Public comment sometimes suggests that these are new proposals which can be obstructed by Ireland or by other member states, but that is not so.
The Commissioner with responsibility for the Internal Market, Mario Monti, very recently confirmed to the duty free industry in the EU that the Commission had no intention of bringing forward any proposal for a further retention of duty free and tax free sales beyond the expiry date of 30 June 1999. If there is no Commission proposal on the table, the Council cannot adopt any measures to extend the concession. I draw the Deputy's attention to that important point.
I know Aer Rianta has taken many steps to diversify its activities, including the operation of duty free shops outside the EU. It operates in Russia and in the Middle and Far East and it has adopted a prudential attitude to the question of duty free sales and to the issue of extension post-1999. Obviously it would like the concession to continue but it has not placed all its eggs in one basket and will be able to cope with the changing circumstances. Increased passenger throughput at the Irish airports will also help.
I am aware of concerns over the ending of duty free facilities for EU travellers. It is a major issue in my constituency of Wexford which includes the port of Rosslare Harbour. The Irish and EU duty free sectors have been making clear their difficulties. The Minister for Finance will monitor the position with interest and he has received representations from the industry which he is considering. As I explained, however, the right of initiative in this case does not rest entirely with us or with the Council. It is a matter initially for the Commission. The Deputy may know one or two friendly Commissioners with whom he could have a word.
