The outlook for the Ioannina – Heraklion air route remains uncertain, within the framework of the Public Service Provision regime, as the Civil Aviation Authority (CAA) points out in its response to the Associations of Epirus Residents of Crete, who requested the re-announcement of the relevant tender process, “it is reasonably likely that a potential new tender, even with more attractive terms for air carriers, will be fruitless.”
The CAA’s response describes a continuing administrative and operational impasse, since, as stated therein, the airlines remain reluctant to undertake the project, even under more favorable terms.
Read the full response of the Civil Aviation Authority…
“Following the above regarding which you requested the re-announcement of the tender procedure for the imposition of public service obligations on the Ioannina-Heraklion route, we bring to your attention the following:
The Civil Aviation Authority (CAA) monitors, within the framework of its responsibilities, air connections within the country, as regulated by Regulation EC 1008/2008, which enables Member States to impose Public Service Obligations (PSOs) on scheduled air routes concerning regional or development areas or on routes with low traffic, provided that these routes are considered to be of vital importance for the economic and social development of the region.
According to EC 1008/2008, a Member State imposes PSOs on scheduled air routes between an EU airport and an airport serving a regional or development area located in the its territory or a route with low traffic, provided that this route is considered to be a route of vital importance for the economic and social development of the region served by the airport. This obligation is imposed to the extent necessary to ensure a minimum service of routes, specified criteria of continuity, regularity, pricing or minimum capacity, which the air carrier would not otherwise undertake if it were to take into account exclusively its commercial interest.
For the inclusion of a new scheduled air route in the Public Service Provision regime, a necessity and feasibility study is prepared and submitted to the European Commission, which examines whether the above conditions are met and, in case they are met, publishes the Decision imposing Public Service Obligations in the Journal of the European Union.
In order to implement the above and in order to impose the new PSO route Ioannina – Heraklion, the APA prepared, on the one hand, a supporting study on the proportionality between the proposed obligation and the economic development needs of the specific area, as well as the possibility of resorting to other modes of transport that satisfy the transport needs under consideration, and on the other hand, technical specifications, which, among other things, describe the supporting documents for participation, the method of drafting the technical and financial offer, the method of evaluating offers, the sanctions imposed in the event of non-smooth fulfillment of the terms of the contract and the method of termination-termination of the contract, while the obligations of minimum flight frequency and minimum seats offered per week are determined, as well as the maximum financial compensation payable.
On 21-12-2022, the terms of the announcement were put under consultation, in which there were no proposals on the financial compensation from any air carrier. However, the company Olympic Air proposed that the public service on the route in question concern flight work only for the medium and high season, a proposal that does not meet the spirit of Regulation EC 1008/2008 nor the requests of local bodies.
The tender was fruitless, due to the lack of interest from the airlines, and was cancelled on 07-08-2023. In the context of examining the possibility of re-announcing the tender and in order to calculate the requested financial compensation, the APA sent a document on 25-09-2023 to the companies Olympic Air, Sky Express, and Marathon Airlines, requesting projected cost and revenue data, but did not receive a response.
The APA, in order to amend the terms of the Declaration, so that the route becomes more attractive for air carriers with a possible reduction in the minimum flight frequency and an increase in the annual financial compensation per flight, sent a new document to the companies Olympic Air and Sky Express on 16-01-2025. With this document, it requested the companies to send their proposals regarding the terms of the tender for the Ioannina-Heraklion route, which should be imposed in order for it to operate and become viable. However, none of the companies responded positively.
Based on the above, it is reasonably likely that a possible new tender, even with more attractive terms for air carriers, will be fruitless.
