Auckland International Airport Limited (Auckland Airport) has welcomed today‟s release of the Commerce Commission‟s emerging views on input methodologies, which will eventually form part of a new regulatory regime for airport services that is due to take effect from 2011.
Following extensive industry consultation during 2009, the Commerce Commission has amended its earlier-announced preliminary views on several aspects relating to the way input methodologies should be determined.
Key changes relate to the valuation of airport land. The Commerce Commission‟s current view is that the initial value of the Regulated Asset Base should use 2009 land values, rather than its earlier view that a 2002 „base valuation‟ be used. Additionally, land should be revalued at least once every five years, with CPI-indexation applying between these revaluations.
Chief Financial Officer Simon Robertson said Auckland Airport had expressed its concerns around the 2002 base valuation approach, as it would have the effect of applying regulation retrospectively. It was important that airport land was appropriately valued so that good commercial decisions were made about its use.
“A central thrust of our submissions on airport regulation has been that airports need to have the correct commercial incentives to ensure they make the necessary infrastructure investment for the benefit of travellers and other airport users, and the broader New Zealand economy.
“We look forward to our ongoing consultation with the Commerce Commission as it progresses development of an information disclosure regime for airports.”
As the next step in the regulatory process, the Commerce Commission is convening an industry workshop to discuss its emerging views paper in February 2010.