Paris Airport Operator Would Hike Fees To Offset Planned Tax

 PARIS—Paris airports operator Groupe ADP says it will increase its fees for airlines if a proposed new tax is voted into law.  

France’s government has been studying ways to ensure that the aviation sector contributes more to decarbonization efforts and transport minister Clement Beaune has previously said raising taxes on airline tickets or airports were two options being considered. The tax is directed at large transport infrastructure companies including airports and motorways.

The French Council of Ministers adopted the country’s 2024 budget Sept. 27, meaning the new tax of 4.6% on the airport group’s revenues would apply starting Jan. 1, 2024, if the budget is approved by the senate and the national assembly. However, the terms of the budget could change as it moves through that process.  

“Pursuant with the French Transport Code and subject to the annual tariffs’ approval by the Transport Regulation Authority (ART), Aéroports de Paris SA intends to pass the increase in regulated expenses through tariffs,” Groupe ADP said.  

The fee increase would be phased in over two to three years to limit the impact on airlines and to comply with the required principle of “moderate” yearly changes in tariffs, ADP said. The first increase, covering around half of the impact from the tax, would apply for the 2024 period. 

Groupe ADP—which operates Paris’ biggest airport Charles de Gaulle and second airport Orly, as well as business aviation-focused Le Bourget and other airports around the world—said if the budget were passed in its current form the new tax would have had an impact of around €100 million ($106 million) on ADP’s operating expenses, thus reducing its earnings before interest, tax, depreciation and amortization (EBITDA) by the same amount, the operator said in a statement.  

While around three quarters could be attributable to the regulated scope, around a quarter of that additional expense could not, and would have to be borne by the group, ADP said.  

If the bill is passed in its current form and annual fees are approved, the group will see a remaining impact of around €90 million in 2024, gradually decreasing from 2025 and limited to its non-regulated portion from 2027 onwards.  

The bill must be submitted to France’s national assembly by Oct. 3, before being put to a vote by the national assembly and by the senate. The bill could be amended.