State to protect Heathrow slots

The Government intends to write conditions into the sale contract for Aer Lingus to protect the airline's landing slots at London's Heathrow Airport.

The Minister for Transport, Martin Cullen, said yesterday the Government would endeavour to protect the slots legally, although he acknowledged their ownership was based on "grandfather rights" rather than ownership.

Heathrow landing slots have come to be owned by various airlines, including Aer Lingus, because they have been operating at the airport for so long.

This gives them "grandfather rights", but the value of the slots cannot be put on airline balance sheets. It is understood Aer Lingus has between 20 and 30 pairs of slots depending on the time of the year.

Asked yesterday on RTÉ Radio whether he would be inserting conditions in the sale documents about Heathrow, Mr Cullen said "we will put as much as we can into the system". He said he hoped this would not put off prospective buyers.

In the last few years there has been a series of so-called "grey market" deals for Heathrow slots that are regarded as illegal by the European Commission, but are accepted by the UK government.

British Airways, Virgin Atlantic, Emirates and Qantas have all been able to expand their slot holdings at Heathrow, while new carriers such as India's Jet Airways have also been able to break into the Heathrow market as new entrants. But the cost of slots can be high.

Heathrow is Europe's busiest airport by passenger numbers and the most important US gateway in Europe.

A few years ago US carrier United sold two pairs of take-off and landing slots to British Airways for about €18 million. It also agreed a three-year lease deal for another pair of slots with Jet Airways.