Wednesday, 4 February 2004

Ceisteanna (197, 198)

Denis Naughten

Ceist:

288 Mr. Naughten asked the Minister for Transport if his attention has been drawn to the financial difficulties at a company (details supplied); the action taken to ensure that passengers would not be stranded abroad and employment would be secured at the company; and if he will make a statement on the matter. [3390/04]

Amharc ar fhreagra

Denis Naughten

Ceist:

294 Mr. Naughten asked the Minister for Transport if his attention has been drawn to the financial difficulties at a company (details supplied); the action taken to ensure that passengers would not be stranded abroad; if he is satisfied there was no unfair competition on the particular routes; the plans he has to ensure that as part of the current review of the EU third aviation package a bonding scheme will be put in place to protect passengers; and if he will make a statement on the matter. [3389/04]

Amharc ar fhreagra

Freagraí scríofa (Ceist ar Minister for Transport)

I propose to take Questions Nos. 288 and 294 together.

The Commission for Aviation Regulation, which is responsible for the economic regulation of Irish airlines, became aware towards the end of last year that Jetmagic was facing financial difficulty. The Commission for Aviation Regulation contacted the company regarding concerns it had about the financial situation and asked the company to improve its balance sheet position. Jetmagic subsequently confirmed to the Commission for Aviation Regulation that it had received additional investment from some of its shareholders. However, it is now clear that those additional funds were not sufficient for the ongoing viability of the company.

As soon as Jetmagic took the decision to suspend operations, it immediately put a comprehensive action plan into place. It made every effort to contact its passengers abroad by telephone or by e-mail, to inform them of the situation and to give them information about alternative ways to get home. The airline put emergency helplines in place, which provided full information about all available flight options back to Ireland from the airports that Jetmagic serves. That information was also available at each airport for passengers as they arrived. Those helplines have received more than 3,000 calls since they opened on Wednesday of last week, mostly from people who had advance bookings. Jetmagic has advised that no one has called in serious distress.

Aer Lingus immediately offered to take any Jetmagic passengers home for a flat fee of €50 plus taxes, from any airport that Aer Lingus serves in Europe. Jetmagic also contacted other airlines, and British Airways, CSA Czech Airlines, and Aer Arann all offered help. I am satisfied that Jetmagic has done all it can in its difficult circumstances to get people home.

FÁS, the national training and employment authority, has contacted Jetmagic, and will make available its full range of support services including skills analysis, jobs placement, guidance and counselling interviews, identification of training needs and suitable training courses to assist the staff of Jetmagic to find suitable alternative employment, should the company actually close down.

European airlines operate under a package of European law, known as the "third air package", dating from 1992. Under that legislation, airlines are free to commence operations as long as they meet economic and safety criteria, and to compete on any routes they wish without recourse to any authorities for approval. While Jetmagic has stated that there was strong competition on its routes, there have been no allegations of unfair competition.

Regarding the third air package, the European Commission is currently reviewing that package of legislation, but has not yet put forward any proposals for change. I am satisfied that the unfortunate collapse of Jetmagic is not due to any deficiency in the licensing arrangements. Moreover, I am not convinced that it would be necessary or appropriate to provide for a bonding mechanism in respect of the purchase of airline tickets.