Authorizing The Civil Aeronautics Administration To Impose Retaliatory Or Compensating Fees, Rentals And Charges On Foreign Airlines

Case Overview and Summary

Summary of Presidential Decree No. 895

Authorizing the Civil Aeronautics Administration to Impose Retaliatory or Compensating Fees, Rentals and Charges on Foreign Airlines

- Recognizes the importance of the Philippine flag carrier in international air transportation for foreign commerce, trade, tourism, balance of payments, foreign exchange reserves, Postal Service, and national security and defense. (Preamble)
- Finds that the Philippine flag carrier's ability to compete is weakened by discriminatory and unfair competitive practices adopted by foreign countries, such as discriminatory airport charges and exorbitant fees, rentals, and charges unrelated to the cost of service. (Preamble)
- Notes the prevailing practice of requiring or giving preference to national flag carriers for government and government-related air transportation to conserve foreign exchange and improve the balance of payments. (Preamble)

• The Civil Aeronautics Administration (CAA) is authorized to determine and impose retaliatory or compensating charges, fees, and rentals on foreign airlines whose countries impose excessive or discriminatory charges on Philippine air carriers, equal to the amount of such excessive or discriminatory charges. (Section 1)
• Charges are deemed excessive or discriminatory when they unreasonably exceed comparable charges in the Philippines. (Section 1)
• The collected amounts shall accrue to a revolving fund, from which payments shall be made to compensate affected Philippine air carriers, and the balance shall be used by the CAA for the construction, repair, maintenance, and improvement of the Manila International Airport and other airports and related facilities. (Section 1)

• The CAA and the Civil Aeronautics Board (CAB) are required to survey air practices, policies, and requirements adopted by foreign countries to determine if they are discriminatory or unreasonable towards Philippine air carriers. (Section 2)
• If any practice, policy, or requirement is found to be discriminatory or unreasonable, the CAA and CAB are authorized to adopt and implement measures, rules, regulations, or practices to compensate the affected Philippine air carrier or place it in a more competitive position. (Section 2)

• All inconsistent laws, decrees, orders, rules, and regulations are repealed or modified accordingly. (Section 3)
• The Decree takes effect immediately. (Section 4)