Norway confirms plan for Avinor ANS separation

Avinor has confirmed that its air navigation services division will be spun off into an independent company as part of a Norwegian government initiative.

In a white paper presented to Parliament this week, Avinor chief executive Dag Falk-Petersen confirmed the government’s commitment.

“Avinor Air Navigation is already established as a wholly owned subsidiary of the group. We are now awaiting a dialogue with the ministry on the way forward,” he said. “We have laid a good foundation for the establishment of an independent company that can continue the competition in both the Norwegian and international air navigation services markets. In recent years, costs have greatly reduced and we will continue this work in order to meet the competitive challenge.”

In the second of two reports commissioned to examine competition in air navigation services,UK consultancy Helios concluded that ‘while there are many tasks that need to be accomplished to open the Norwegian airport ANS market to competition, none represents an insurmountable barrier to this happening’.

The 2016 report for the Norwegian transport ministry pointed out however that further separation between the ANS division from Avinor’s airports was needed to eliminate any doubt over the fairness of the tender process.

“Although their activities within the Avinor Group are already separately defined, many central functions however are shared and new arrangements for these services will be required,” it stated.

Helios said separation is likely to take more than a year and that in the meantime more detailed oversight by the economic regulator would be necessary to allow the first competitive tenders to be launched.

“In addition, a further degree of separation between the competed and non-competed activities within [Avinor ANS] should be considered to prevent anti-competitive cross-subsidy from the latter to the former,” the report concluded. “This can first be achieved by establishing subsidiary companies under a single holding company. The economic regulatory function of the CAA will need to be strengthened.”

Norway’s transport ministry also engaged PricewaterhouseCoopers to estimate the market value of Avinor and its subsidiaries.

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