Dublin Airport body wants say in Shannon operations

The Dublin Airport Authority is insisting it should be allowed retain the right to issue directions to Shannon Airport under a new deal to be hammered out between the two organisations. Emmet Oliver reports.

Under a draft management agreement between the two airports, Dublin Airport is prepared to vest various statutory functions in the Shannon Airport Authority in the months ahead as part of the planned establishment of Shannon as a competing independent entity.

But according to a document seen by The Irish Times, the Dublin board has certain reservations about the interim arrangements.

A document to be presented to the board of the Dublin Airport Authority states: "Dublin Airport are insisting that they should have the ability to give Shannon Airport Authority directions in relation to the running of Shannon Airport."

The document suggests there may have been some tension about this position. It suggests Shannon might react negatively if asked to do things it disagreed with. In that case, states the document, "Shannon Airport Authority have no responsibility for the consequences of following Dublin's direction".

The document points out that while Dublin Airport is entitled to transfer various statutory functions over to Shannon Airport, the legal implications need to be carefully considered. "In other words, Shannon Airport Authority would be legally obliged to carry out the running and management functions in relation to Shannon Airport in good faith and to act with all due care and attention in that regard.

"Shannon Airport Authority would be legally obliged to bring to bear reasonable business judgment and expertise in the running and management of Shannon Airport," states the document.

However the document seems to suggest that Shannon Airport may have to be indemnified by Dublin Airport against "all actions, proceedings, claims, costs, expenses and liabilitities incurred by Shannon Airport Authority".

It says the effect of this will be significant. "The effect of this arrangement should be to ensure that whilst Shannon Airport runs and manages Shannon Airport on behalf of Dublin Airport during the interim period... the liabilities arising from those activities would be for the account of Dublin Airport, and not Shannon," it states.

The interim period in this case refers to the period before all three airports are completely separated. Under the State Airports Act 2004, the three airports will become autonomous (no earlier than April 2005), but until then Dublin Airport is the ultimate owner of all three airports. However, it is allowed to vest certain statutory functions in the three airports before then.