An Act about airports

This Act may be cited as the Airports Act 1996.

This Act commences on the day on which it receives the Royal Assent.

The objects of this Act are as follows:

(a) to promote the sound development of civil aviation in Australia;

(b) to establish a system for the regulation of airports that has due regard to the interests of airport users and the general community;

(d) to facilitate the comparison of airport performance in a transparent manner;

(e) to ensure majority Australian ownership of airports;

(f) to limit the ownership of certain airports by airlines;

(g) to ensure diversity of ownership and control of certain major airports;

(h) to implement international obligations relating to airports.

4 Simplified outline

The following is a simplified outline of this Act:

• This Act sets up a system for regulating airports.

• A Commonwealth‑owned airport can only be leased to a company. The company is called an airport‑lessee company.

• There will only be one airport‑lessee company for each airport and the company will not be allowed to lease another airport.

• An airport‑lessee company’s sole business will be to run the airport.

• An airport‑lessee company can contract out the management of the airport to another company. The other company is called an airport‑management company.

• This Act uses the term airport‑operator company to cover both airport‑lessee companies and airport‑management companies.

• Airport‑operator companies are subject to the following ownership restrictions:

(a) a 49% limit on foreign ownership;

(b) a 5% limit on airline ownership for certain airports;

• For each airport, there will be an airport master plan.

• Major development plans will be required for significant developments at airports.

• Building activities on airport sites will require approval.

• Buildings and structures on airport sites must be certified as complying with the regulations.

• For each airport, there will be an environment strategy.

• The regulations may deal with environmental standards at airport sites.

• An airport‑operator company may be required to give accounts and reports to the Australian Competition and Consumer Commission.

• The regulations may require the Australian Competition and Consumer Commission to monitor the quality of certain aspects of airport services and facilities.

• Airport‑lessee companies must give written consent before airport sites are varied or closed.

• The regulations may implement certain international agreements relating to airports.

• The regulations may deal with the control of the following matters at airports:

(a) liquor;

(b) commercial trading;

(d) gambling;

(e) smoking.

• The regulations may control intrusions into prescribed airspace around airports.

• An airport service will be a declared service for the purposes of the access regime set out in Part IIIA of the Trade Practices Act 1974 unless an access undertaking is given within 12 months after responsibility for the airport is transferred to the private sector.

• The Minister may formulate demand management schemes for airports.

• Air traffic services, and rescue and fire fighting services, must not be provided at airports without the approval of the Civil Aviation Safety Authority.

5 Definitions

In this Act, unless the contrary intention appears:

ACCC means the Australian Competition and Consumer Commission.

agreement means any agreement, whether formal or informal and whether express or implied.

aircraft means a machine or craft that can derive support in the atmosphere from the reactions of the air.

aircraft movement means:

(a) the landing of an aircraft at an airport; or

(b) the taking off of an aircraft from an airport.

airline means a person who carries on a commercial air transport enterprise that involves offering or operating scheduled or chartered air services.

airport means an airport in Australia.

airport capacity declaration has the meaning given by section 195.

airport lease:

(a) means a lease of the whole or a part of an airport site, where the Commonwealth is the lessor; and

(b) when used in relation to an airport—means a lease of the whole or a part of the airport site of the airport, where the Commonwealth is the lessor.

airport‑lessee company means a company that holds an airport lease.

airport‑management agreement has the meaning given by section 33.

airport‑management company means a company that is a party to an airport‑management agreement with an airport‑lessee company.

airport‑operator company means an airport‑lessee company or an airport‑management company.

airport site means a place that is:

(a) declared by the regulations to be an airport site; and

(b) a Commonwealth place; and

(c) used, or intended to be developed for use, as an airport (whether or not the place is used, or intended to be developed for use, for other purposes).

Note: The boundaries of an airport site are ascertained in accordance with the regulations.

Airside Vehicle Control Handbook for an airport has the meaning given by subsection 172(2).

approved auditor has the meaning given by section 144.

Australia, when used in a geographical sense, includes the external Territories.

Australian Noise Exposure Forecast, for an airport, means an Australian Noise Exposure Forecast endorsed in the manner approved by the Minister.

building activities has the meaning given by subsection 98(1).

business day means a day that is not:

(a) a Saturday; or

(b) a Sunday; or

(d) 27, 28, 29, 30 or 31 December.

Commonwealth place means:

(a) a Commonwealth place within the meaning of the Commonwealth Places (Application of Laws) Act 1970; or

(b) a place in a Territory, where the place is owned by the Commonwealth.

company means a body corporate.

constitutional corporation means a corporation to which paragraph 51(xx) of the Constitution applies.

constructing has the meaning given by subsection 89(2A).

core regulated airport has the meaning given by section 7.

declared capacity, in relation to an airport, has the meaning given by section 195.

demand management scheme has the meaning given by section 201.

draft environment strategy means a draft environment strategy under Division 2 of Part 6.

draft master plan means a draft master plan under Division 3 of Part 5.

engage in conduct means:

(a) do an act; or

(b) omit to perform an act.

Federal Court means the Federal Court of Australia.

final environment strategy means a final environment strategy under Division 2 of Part 6.

final master plan means a final master plan under Division 3 of Part 5.

interest, in relation to an airport lease, means a right or interest, whether legal or equitable, in the airport lease, by whatever term called, and includes an option to acquire such a right or interest in the airport lease, but to avoid doubt, does not include, and is taken never to have included:

(a) a sublease; or

(b) a licence; or

(d) a restrictive covenant.

international air transport means air transport between a place in Australia and a place outside Australia.

interstate air transport includes air transport between a State and a Territory or between 2 Territories.

joint‑user airport has the meaning given by section 7B.

lender, in relation to a loan security, means the person who is entitled to enforce the security.

lending money includes providing non‑equity finance where the provision of the finance may reasonably be regarded as equivalent to lending money.

loan security means a security held solely for the purposes of a moneylending agreement.

major airport development has the meaning given by section 89.

major development plan means a major development plan under Division 4 of Part 5.

moneylending agreement means an agreement entered into in good faith in the ordinary course of carrying on a business of lending money, but does not include an agreement dealing with any matter unrelated to the carrying on of that business.

pair of airport‑operator companies has the meaning given by section 49.

qualified company means a company that:

(a) is a constitutional corporation; and

(b) is incorporated, or taken to be incorporated, under the Corporations Act 2001; and

quality of service matter has the meaning given by subsection 156(7).

scheme means:

(a) any agreement, arrangement, understanding, promise or undertaking, whether express or implied and whether or not enforceable, or intended to be enforceable, by legal proceedings; and

(b) any scheme, plan, proposal, action, course of action or course of conduct, whether unilateral or otherwise.

significant ANEF levels means a noise above 30 ANEF levels.

this Act includes the regulations.

unacceptable airline‑ownership situation has the meaning given by section 44.

unacceptable cross‑ownership situation has the meaning given by section 50.

unacceptable foreign‑ownership situation has the meaning given by section 40.

Note: The Schedule sets out definitions of expressions used in Part 3 (which deals with ownership restrictions).

vehicle has the meaning given by subsection 172(2).

6 Sydney West Airport

For the purposes of this Act, Sydney West Airport is taken to be an airport at a particular time even if, at that time, it is:

(a) merely intended to be developed for use as an airport; or

(b) being developed for use as an airport.

7 Meaning of core regulated airport

(1) For the purposes of this Act, each of the following airports is a core regulated airport:

(a) Sydney (Kingsford‑Smith) Airport;

(b) Sydney West Airport;

(d) Brisbane Airport;

(e) Perth Airport;

(f) Adelaide Airport;

(g) Gold Coast Airport;

(h) Hobart Airport;

(i) Launceston Airport;

(j) Alice Springs Airport;

(k) Canberra Airport;

(l) Darwin Airport;

(m) Townsville Airport;

(n) an airport specified in the regulations, where the site of the airport is a Commonwealth place.

(2) For the purposes of paragraph (1)(n), the boundaries of the site of an airport are to be ascertained in accordance with the regulations.

7A Transfers and acquisitions by way of the enforcement of a loan security

(1) A reference in this Act to a transfer by way of the enforcement of a loan security is a reference to a transfer to the lender by way of the enforcement of the loan security.

(2) A reference in this Act to an acquisition by way of the enforcement of a loan security is a reference to the acquisition by the lender by way of the enforcement of the loan security.

(3) This section is enacted for the avoidance of doubt.

7B Meaning of joint‑user airport

(1) For the purposes of this Act, each of the following airports is a joint‑user airport:

(a) Darwin Airport;

(b) Townsville Airport;

(2) For the purposes of this Act, Canberra Airport is a joint‑user airport. However, the regulations may declare that, for the purposes of this Act, Canberra Airport ceases to be a joint‑user airport at a specified time.

(3) For the purposes of paragraph (1)(c), the boundaries of the site of an airport are to be ascertained in accordance with the regulations.

7C Giving information and the Electronic Transactions Act

To avoid doubt, a reference in section 9 of the Electronic Transactions Act 1999 to giving information includes, for the purposes of this Act, a reference to giving:

(a) a draft master plan, a draft major development plan or a draft environment strategy; or

(b) a draft variation of a final master plan, a major development plan or a final environment strategy.

8 Crown to be bound

(1) This Act binds the Crown in the right of the Commonwealth, of each of the States, of the Australian Capital Territory, of the Northern Territory and of Norfolk Island.

(2) This Act does not make the Crown liable to be prosecuted for an offence.

9 External Territories

This Act extends to all the external Territories.

10 Extra‑territorial operation

This Act extends to acts, omissions, matters and things outside Australia, whether or not in a foreign country.

10A Application of the Criminal Code

Chapter 2 (except Part 2.5) of the Criminal Code applies to all offences created by this Act.

Note: Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

Part 2—Leasing and management of airports

Division 1—Simplified outline

11 Simplified outline

The following is a simplified outline of this Part:

• Airport leases are subject to the following key rules:

(a) the lessee must be a company;

(b) the term of the lease must not be longer than 50 years (with or without an option to renew for up to 49 years);

(d) a company can only lease one airport.

• The airport‑lessee companies for Sydney (Kingsford‑Smith) Airport and Sydney West Airport must be wholly‑owned subsidiaries of the same holding company.

• Airport leases can only be transferred with the Minister’s approval.

• The beneficial and legal interests in an airport lease cannot be separated except in the case of the enforcement of a loan security.

• If a lender acquires a lease, or enters into possession of an airport site, by way of the enforcement of a loan security, the lender must:

(a) notify the Minister; and

(b) transfer the lease to another company.

• An airport‑lessee company has a statutory obligation to use the airport site as an airport.

• An airport‑lessee company’s sole business will be to run the airport.

• An airport‑lessee company can contract out the management of the airport to another company. The other company is called an airport‑management company. An airport‑management company must be approved by the Minister.

• The regulations may prohibit certain subleases and licences relating to airport sites.

• The regulations may deal with the terms of subleases and licences relating to airport sites.

• The regulations may provide that the beneficial and legal interests in subleases and licences relating to airport sites cannot be separated except in the case of the enforcement of a loan security.

Division 2—Scope of Part

12 Airports to which Part applies

(1) This Part applies to:

(a) a core regulated airport; or

(b) an airport specified in the regulations, where the site of the airport is a Commonwealth place.

(2) For the purposes of paragraph (1)(b), the boundaries of the site of an airport are to be ascertained in accordance with the regulations.

Division 3—Grant of airport leases

13 Commonwealth may grant airport lease

The Commonwealth may grant an airport lease under this section.

14 Rules about airport leases

Grant

(1) The Commonwealth must not grant an airport lease unless the lease complies with subsection (5).

Variation

(2) An airport lease must not be varied unless the varied lease complies with subsection (5).

Transfer

(3) The Minister must not approve the transfer of an airport lease unless the transferred lease complies with subsection (5).

Contravention

(4) If a purported grant, variation or approval contravenes this section, it is of no effect.

Rules about airport leases

(5) An airport lease complies with this subsection if:

(a) there is a single lessee; and

(b) the lessee is a qualified company; and

(c) the term of the lease is not longer than 50 years (with or without an option to renew the lease for up to 49 years); and

(d) if the airport is neither a joint‑user airport nor Sydney West Airport—the lease provides for the use of the site as an airport (whether or not the lease also provides for other uses); and

(e) if the airport is a joint‑user airport—the lease provides for the use of the leased area for purposes in connection with the airport (whether or not the lease also provides for other uses); and

(f) if the airport is Sydney West Airport—the lease provides for the development of the site as an airport or the use of the site as an airport, or both (whether or not the lease also provides for other developments or other uses); and

(g) the lease provides for access to the airport by interstate air transport or international air transport, or both (whether or not the lease also provides for other access).

15 Termination of airport lease if lessee ceases to be a qualified company

(1) This section applies to an airport lease if the lessee is a qualified company.

(2) If, at a particular time, the lessee ceases to be a qualified company, the lease terminates at that time.

16 Person may acquire airport leases for only one airport site

(1) The Commonwealth must not grant a lease of the whole or a part of an airport site to a person who already holds an airport lease or an interest in an airport lease, unless each of those leases relates to the same airport site.

(2) The Minister must not approve the transfer of a lease of the whole or a part of an airport site to a person who already holds an airport lease or an interest in an airport lease, unless each of those leases relates to the same airport site.

(3) If a purported grant or approval contravenes this section, it is of no effect.

17 Simultaneous grant of leases to the same person must relate to the same airport

(1) The Commonwealth must not simultaneously grant to the same person 2 or more airport leases, unless those leases relate to the same airport site.

(2) If purported grants contravene this section, they are of no effect.

18 Sydney (Kingsford‑Smith) Airport and Sydney West Airport to be under common ownership

Grant of lease under this Act or under section 22 of the Airports (Transitional) Act

(1) The Commonwealth must not grant an airport lease under section 13 of this Act, or under section 22 of the Airports (Transitional) Act 1996, for Sydney (Kingsford‑Smith) Airport or Sydney West Airport unless each of the airport‑lessee companies is a subsidiary of the same company.

Grant of lease under section 21 of the Airports (Transitional) Act

(2) If:

(a) an airport lease for Sydney (Kingsford‑Smith) Airport is granted to a company under section 21 of the Airports (Transitional) Act 1996; or

(b) an airport lease for Sydney West Airport is granted to a company under section 21 of the Airports (Transitional) Act 1996;

the Commonwealth must take such steps as are necessary to ensure that, in the event of the disposal by the Commonwealth of its shares in either of those companies, each of those companies becomes a subsidiary of the same company.

Transfer of lease for Sydney (Kingsford‑Smith) Airport

(3) The Minister must not approve the transfer of an airport lease for Sydney (Kingsford‑Smith) Airport unless the transferee and the airport‑lessee company for Sydney West Airport will be subsidiaries of the same company.

Transfer of lease for Sydney West Airport

(4) The Minister must not approve the transfer of an airport lease for Sydney West Airport unless the transferee and the airport‑lessee company for Sydney (Kingsford‑Smith) Airport will be subsidiaries of the same company.

Contravention

(5) If a purported grant or approval contravenes this section, it is of no effect.

Termination of leases

(6) If, at a particular time when the Commonwealth does not beneficially own all the shares in:

(a) the airport‑lessee company for Sydney (Kingsford‑Smith) Airport; and

(b) the airport‑lessee company for Sydney West Airport;

an unacceptable leasing situation comes into existence for Sydney (Kingsford‑Smith) Airport and Sydney West Airport:

(d) the airport lease for Sydney West Airport terminates at that time.

For this purpose, an unacceptable leasing situation exists for Sydney (Kingsford‑Smith) Airport and Sydney West Airport if the airport‑lessee companies for those airports are not subsidiaries of the same company.

Subsidiaries

(7) For the purposes of this section, a company (the subsidiary company) is taken to be a subsidiary of another company (the holding company) if, and only if, all the shares in the subsidiary company are beneficially owned by the holding company.

19 Only one person to hold airport leases for an airport site

(1) The Commonwealth must not grant a lease of the whole or a part of an airport site to a person if another person already holds an airport lease for the airport.

(1A) If there are 2 or more airport leases for the same airport site, the Minister must not approve the transfer of any of those leases unless the Minister is satisfied that, immediately after the transfer of that lease, all of those leases will be held by the same person.

(2) If a purported grant or approval contravenes this section, it is of no effect.

20 Simultaneous grant of leases relating to the same airport site to be to the same person

(1) The Commonwealth must not simultaneously grant 2 or more leases relating to different parts of the same airport site, unless those grants are to the same person.

(2) If purported grants contravene this section, they are of no effect.

20A Airport leases for an airport site to expire on the same day

If there are, or are to be, 2 or more airport leases for the same airport site, the Commonwealth must ensure that the term of each of those leases expires on the same day.

21 No grant of lease if Part 3 contravened

(1) The Commonwealth must not grant an airport lease to a company if the Minister is satisfied that:

(a) an unacceptable foreign‑ownership situation in relation to the company would come into existence in the event of the grant; or

(b) an unacceptable airline‑ownership situation in relation to the company would come into existence in the event of the grant; or

(i) the company would become a member of a pair of airport‑operator companies in the event of the grant; and

(ii) an unacceptable cross‑ownership situation in relation to the pair would come into existence in the event of the grant.

(2) If a purported grant contravenes this section, it is of no effect.

22 Airport lease granted subject to existing interests in the land

(1) An airport lease is granted under section 13 subject to all existing leases in relation to the land concerned.

(2) The following provisions have effect:

(a) all obligations and benefits of the Commonwealth under, or connected with, such an existing lease:

(i) pass to the airport‑lessee company; and

(ii) cease to be enforceable by or against the Commonwealth;

whether or not the obligations or benefits touch and concern the land;

(b) an instrument relating to such an obligation or benefit continues to have effect after the grant of the airport lease as if a reference in the instrument to the Commonwealth or the Federal Airports Corporation were a reference to the company;

(c) the company becomes the Commonwealth’s successor in law, in relation to such an obligation or benefit, immediately after the grant of the airport lease.

Note 1: The lessees of existing leases become lessees of the airport‑lessee company.

Note 2: Subsections (1) and (2) relate to the obligations and benefits of the Commonwealth as lessor. Section 17 of the Airports (Transitional) Act 1996 deals with a case where the Commonwealth is the lessee under an existing lease.

(3) An airport lease is granted under section 13 subject to all other existing interests in the land concerned.

(4) Paragraph (2)(b) does not modify any register kept by a land registration official under a law of a State or Territory.

(5) In this section:

instrument includes a document.

Division 4—Restrictions on acquisition and transfer of airport leases

23 Restriction on acquisition of airport lease

(1) A person must not acquire an airport lease, or an interest in an airport lease, unless:

(a) the person is a qualified company; or

(b) the acquisition is by way of the enforcement of a loan security and the person is a constitutional corporation.

(2) If a purported acquisition contravenes this section, it is of no effect.

24 No transfer of airport lease without approval of Minister

(1) An airport lease must not be transferred without the written approval of the Minister.

(2) If a purported transfer contravenes this section, it is of no effect.

(3) The Minister may only refuse to approve the transfer of an airport lease:

(a) on a ground specified in the regulations; or

(b) on the grounds set out in subsection 14(3); or

(d) on the grounds set out in subsection 18(3) or (4); or

(da) on the grounds set out in subsection 19(1A); or

(e) on the grounds set out in section 25.

(4) This section does not apply to a transfer by way of the enforcement of a loan security.

25 No transfer of lease if Part 3 contravened

The Minister must not approve the transfer of an airport lease to a company if the Minister is satisfied that:

(a) an unacceptable foreign‑ownership situation in relation to the company would come into existence in the event of the transfer; or

(b) an unacceptable airline‑ownership situation in relation to the company would come into existence in the event of the transfer; or

(i) the company would become a member of a pair of airport‑operator companies in the event of the transfer; and

(ii) an unacceptable cross‑ownership situation in relation to the pair would come into existence in the event of the transfer.

26 No declaration of trust in respect of airport lease

(1) The lessee of an airport lease must not dispose of the lease by way of declaration of trust.

(2) If a purported disposal contravenes this section, it is of no effect.

27 Beneficial interest in airport lease must not be transferred independently of legal interest

(1) A beneficial interest in an airport lease must not be transferred independently of the legal interest in the lease.

(2) If a purported transfer contravenes this section, it is of no effect.

(3) This section does not apply to a transfer by way of the enforcement of a loan security.

28 Notification of acquisition of lease or of entry into possession—enforcement of loan security

(1) If:

(a) a person acquires an airport lease; and

(b) the acquisition is by way of the enforcement of a loan security;

the person must, within 7 days after acquiring the lease, give the Minister written notice of the acquisition.

Penalty: 100 penalty units.

(2) If:

(a) an airport lease is subject to a loan security; and

(b) the lender enters into possession of the land to which the lease relates; and

the lender must, within 7 days after entering into possession, give the Minister written notice of the entry into possession.

Penalty: 100 penalty units.

29 Re‑transfer of lease—enforcement of loan security

Re‑transfer

(1) If:

(a) a person acquires an airport lease; and

(b) the acquisition is by way of the enforcement of a loan security;

the person must transfer the lease to a qualified company:

(d) if a longer period is specified in a written notice given to the person by the Minister—within that longer period.

Entry into possession

(1A) If:

(a) an airport lease is subject to a loan security; and

(b) the lender enters into possession of the land to which the lease relates; and

the lender must cause the lease to be transferred to a qualified company:

(d) within 90 days after the lender entered into possession; or

(e) if a longer period is specified in a written notice given to the lender by the Minister—within that longer period.

Offence

(2) A person commits an offence if:

(a) the person is subject to a requirement to transfer a lease under subsection (1) or (1A); and

(b) the person engages in conduct; and

Penalty: 400 penalty units.

Strict liability

(2A) Strict liability applies to paragraph (2)(a).

Note: For strict liability, see section 6.1 of the Criminal Code.

Court orders

(3) If:

(a) a person contravenes subsection (1) or (1A) in relation to an airport lease; and

(b) the Minister applies to the Federal Court for an order terminating the lease;

the court may make such orders as the court considers appropriate for the purpose of terminating the lease.

Criteria for making order

(4) In deciding whether to make such an order, the court must have regard to:

(a) whether the person made reasonable efforts to obtain the Minister’s approval for the transfer of the lease to another person; and

(b) the reasonableness of the Minister’s decisions under paragraph (1)(d) or (1A)(e) in relation to the lease; and

30 Termination of airport lease otherwise than under this Act

This Act does not, by implication, prevent an airport lease from being terminated otherwise than under a provision of this Act.

Division 5—Obligation to use airport site as an airport

31 Obligation to use airport site as an airport

(1) This section has effect for the purposes of determining whether:

(a) an airport‑operator company for an airport; or

(b) a person acting on behalf of an airport‑operator company for an airport;

has a defence to, or an immunity from:

(d) an administrative proceeding; or

(e) a proceeding in a tribunal.

Airports other than joint‑user airports

(2) In the case of an airport other than a joint‑user airport, the company has, by force of this subsection, an obligation to use the airport site concerned as an airport.

Joint‑user airports

(3) In the case of a joint‑user airport, the company has, by force of this subsection, an obligation to use the airport site for purposes in connection with the airport.

Licences

(4) This section does not free a person from a requirement to hold a licence or permit (however described) under a law of the Commonwealth. For this purpose, law of the Commonwealth does not include an applied provision within the meaning of the Commonwealth Places (Application of Laws) Act 1970.

Division 6—Restrictions on lessees

Subdivision A—Airport‑operator company must not carry on non‑airport business

32 Airport‑operator company must not carry on non‑airport business

Airports other than joint‑user airports

(1) An airport‑operator company for an airport (other than a joint‑user airport) must not carry on substantial trading or financial activities other than:

(a) activities relating to the operation and/or development of the airport; or

(b) activities incidental to the operation and/or development of the airport; or

(c) activities that, under the regulations, are treated as activities incidental to the operation and/or development of the airport; or

(d) activities that are consistent with the airport lease for the airport and the final master plan for the airport.

Joint‑user airports

(2) An airport‑operator company for a joint‑user airport must not carry on substantial trading or financial activities other than:

(a) activities connected with the airport; or

(b) activities incidental to activities connected with the airport; or

(c) activities that, under the regulations, are treated as activities incidental to activities connected with the airport; or

(d) activities that are consistent with the airport lease for the airport and the final master plan for the airport.

Offence

(3) A company commits an offence if:

(a) the company is subject to a requirement under subsection (1) or (2); and

(b) the company engages in conduct; and

Penalty: 2,000 penalty units.

Strict liability

(3A) Strict liability applies to paragraph (3)(a).

Note: For strict liability, see section 6.1 of the Criminal Code.

Loan securities

(4) Subsections (1) and (2) do not apply to an airport‑lessee company for an airport if the company acquired its airport lease or airport leases by way of the enforcement of a loan security.

Validity of transactions

(5) A contravention of this section does not affect the validity of any transaction.

Subdivision B—Airport‑management agreements

33 Airport‑management agreements

Approval of airport‑management company

(1) The airport‑lessee company for an airport must not enter into an airport‑management agreement in relation to the airport unless the other party to the agreement is both:

(a) approved in writing by the Minister; and

(b) a qualified company.

Note: Airport‑management agreement is defined by subsection (7).

Contravention

(2) If a purported agreement contravenes subsection (1), it is of no effect.

Breach of ownership restrictions

(3) The Minister must not approve a company under subsection (1) if the Minister is satisfied that:

(a) an unacceptable foreign‑ownership situation in relation to the company would come into existence in the event that the agreement was entered into; or

(b) an unacceptable airline‑ownership situation in relation to the company would come into existence in the event that the agreement was entered into; or

(i) the company would become a member of a pair of airport‑operator companies in the event that the agreement was entered into; and

(ii) an unacceptable cross‑ownership situation in relation to the pair would come into existence in the event that the agreement was entered into.

Other grounds for refusing approval

(4) If subsection (3) does not apply to the approval of a company under subsection (1), the Minister may only refuse to approve the company on a ground specified in the regulations.

Approval of agreement

(4A) The airport‑lessee company for an airport must not enter into an airport‑management agreement in relation to the airport unless the agreement is approved in writing by the Minister.

Note: Airport‑management agreement is defined by subsection (7).

Contravention

(4B) If a purported agreement contravenes subsection (4A), it is of no effect.

Criteria for approval

(4C) In making a decision under subsection (4A), the Minister must have regard to:

(a) the matters specified in the regulations; and

(b) such other matters (if any) as the Minister considers relevant.

Approval of variation

(4D) An airport‑management agreement in relation to the airport must not be varied unless the variation is approved in writing by the Minister.

Note: Airport‑management agreement is defined by subsection (7).

Contravention

(4E) If a purported variation contravenes subsection (4D), it is of no effect.

Criteria for approval

(4F) In making a decision under subsection (4D), the Minister must have regard to:

(a) the matters specified in the regulations; and

(b) such other matters (if any) as the Minister considers relevant.

Termination of agreement if contractor ceases to be a qualified company

(5) If:

(a) a qualified company (the contractor) enters into an airport‑management agreement in relation to an airport; and

(b) at a particular time, the contractor ceases to be a qualified company;

the agreement terminates at that time.

Other means of termination

(6) This section does not, by implication, prevent an agreement from being terminated otherwise than under subsection (5).

Airport‑management agreement

(7) For the purposes of this Act, an airport‑management agreement, in relation to an airport, is an agreement (other than a contract of employment or a prescribed kind of agreement) between:

(a) the airport‑lessee company for the airport; and

(b) another person;

under which the other person (either alone or together with the company and/or one or more other persons) is in a position to exercise control over either or both of the following:

(d) the direction to be taken in relation to the development of the whole or a substantial part of the airport.

Economic and commercial substance of agreement

(8) In determining whether an agreement is an airport‑management agreement, regard must be had to the economic and commercial substance of the agreement.

(9) Subsection (8) does not, by implication, limit subsection (7).

Subdivision C—Subleases and licences

34 Regulations may prohibit subleases of airport leases

(1) The regulations may prohibit specified kinds of subleases of an airport lease.

(2) A sublease of an airport lease must not be granted or varied in contravention of those regulations.

(3) If a purported grant or variation contravenes subsection (2), it is of no effect.

(4) If a sublease is in force at the time (the imposition time) when regulations made for the purposes of subsection (1) impose a prohibition in relation to the sublease:

(a) the prohibition does not have any effect on the validity of the sublease during the 90‑day period beginning at the imposition time; and

(b) if, at the end of that 90‑day period, the sublease contravenes the prohibition—the sublease is terminated immediately after the end of that period.

34A Regulations may prohibit terms from being included in sublease of airport lease

(1) The regulations may prohibit specified kinds of terms from being included in subleases of an airport lease.

(2) A sublease of an airport lease must not be granted or varied in contravention of those regulations.

(3) If a purported grant or variation contravenes subsection (2), it is of no effect.

(4) If a sublease is in force at the time (the imposition time) when regulations made for the purposes of subsection (1) impose a prohibition in relation to the sublease:

(a) the prohibition does not have any effect on the validity of the sublease during the 90‑day period beginning at the imposition time; and

(b) if, at the end of that 90‑day period, the sublease contravenes the prohibition—the sublease is terminated immediately after the end of that period.

(5) In this section:

terms includes conditions.

34B Regulations may require terms to be included in sublease of airport lease

(1) The regulations may require that specified kinds of terms must be included in subleases of an airport lease.

(2) A sublease of an airport lease must not be granted or varied in contravention of those regulations.

(3) If a purported grant or variation contravenes subsection (2), it is of no effect.

(4) If a sublease is in force at the time (the imposition time) when regulations made for the purposes of subsection (1) impose a requirement in relation to the sublease:

(a) the requirement does not have any effect on the validity of the sublease during the 90‑day period beginning at the imposition time; and

(b) if, at the end of that 90‑day period, the sublease contravenes the requirement—the sublease is terminated immediately after the end of that period.

(5) In this section:

terms includes conditions.

34C Regulations may prohibit declaration of trust in respect of sublease of airport lease

(1) The regulations may provide that the sublessee of an airport lease must not dispose of the sublease by way of declaration of trust.

(2) If a purported disposal contravenes those regulations, it is of no effect.

34D Regulations may provide that a beneficial interest in a sublease of airport lease must not be transferred independently of the legal interest

(1) The regulations may provide that a beneficial interest in a sublease of an airport lease must not be transferred independently of the legal interest in the sublease.

(2) If a purported transfer contravenes those regulations, it is of no effect.

(3) This section does not apply to a transfer by way of the enforcement of a loan security.

35 Regulations may prohibit licences relating to airport leases

(1) The regulations may prohibit specified kinds of licences relating to an airport lease.

(2) A licence relating to an airport lease must not be granted or varied in contravention of those regulations.

(3) If a purported grant or variation contravenes subsection (2), it is of no effect.

(4) If a licence is in force at the time (the imposition time) when regulations made for the purposes of subsection (1) impose a prohibition in relation to the licence:

(a) the prohibition does not have any effect on the validity of the licence during the 90‑day period beginning at the imposition time; and

(b) if, at the end of that 90‑day period, the licence contravenes the prohibition—the licence is terminated immediately after the end of that period.

35A Regulations may prohibit terms from being included in licence relating to airport lease

(1) The regulations may prohibit specified kinds of terms from being included in licences relating to an airport lease.

(2) A licence relating to an airport lease must not be granted or varied in contravention of those regulations.

(3) If a purported grant or variation contravenes subsection (2), it is of no effect.

(4) If a licence is in force at the time (the imposition time) when regulations made for the purposes of subsection (1) impose a prohibition in relation to the licence:

(a) the prohibition does not have any effect on the validity of the licence during the 90‑day period beginning at the imposition time; and

(b) if, at the end of that 90‑day period, the licence contravenes the prohibition—the licence is terminated immediately after the end of that period.

(5) In this section:

terms includes conditions.

35B Regulations may require terms to be included in licence relating to airport lease

(1) The regulations may require that specified kinds of terms must be included in licences relating to an airport lease.

(2) A licence relating to an airport lease must not be granted or varied in contravention of those regulations.

(3) If a purported grant or variation contravenes subsection (2), it is of no effect.

(4) If a licence is in force at the time (the imposition time) when regulations made for the purposes of subsection (1) impose a requirement in relation to the licence:

(a) the requirement does not have any effect on the validity of the licence during the 90‑day period beginning at the imposition time; and

(b) if, at the end of that 90‑day period, the licence contravenes the requirement—the licence is terminated immediately after the end of that period.

(5) In this section:

terms includes conditions.

35C Regulations may prohibit declaration of trust in respect of licence relating to airport lease

(1) The regulations may provide that the holder of a licence relating to an airport lease must not dispose of the licence by way of declaration of trust.

(2) If a purported disposal contravenes those regulations, it is of no effect.

35D Regulations may provide that a beneficial interest in a licence relating to an airport lease must not be transferred independently of the legal interest

(1) The regulations may provide that a beneficial interest in a licence relating to an airport lease must not be transferred independently of the legal interest in the licence.

(2) If a purported transfer contravenes those regulations, it is of no effect.

(3) This section does not apply to a transfer by way of the enforcement of a loan security.

35E Termination of sublease or licence otherwise than under this Subdivision

This Subdivision does not, by implication, prevent a sublease or licence from being terminated otherwise than under this Subdivision.

35F Compensation—constitutional safety‑net

(1) If:

(a) apart from this section, the operation of this Subdivision would result in the acquisition of property from a person otherwise than on just terms; and

(b) the acquisition would be invalid because of paragraph 51(xxxi) of the Constitution;

the Commonwealth is liable to pay compensation of a reasonable amount to the person in respect of the acquisition.

(2) If the Commonwealth and the person do not agree on the amount of the compensation, the person may institute proceedings in the Federal Court for the recovery from the Commonwealth of such reasonable amount of compensation as the court determines.

(3) In this section:

acquisition of property has the same meaning as in paragraph 51(xxxi) of the Constitution.

just terms has the same meaning as in paragraph 51(xxxi) of the Constitution.

Division 7—Lands Acquisition Act 1989 not to apply to anything done under this Part

36 Lands Acquisition Act 1989 not to apply to anything done under this Part

The Lands Acquisition Act 1989 does not apply to anything done under this Part.

Division 8—Entries in title registers

37 Entries in title registers

(1) This section applies if an airport lease is granted under section 13.

(2) The relevant land registration official may make such entries or notations in or on registers or other documents kept by the official (in electronic form or otherwise) as the official thinks appropriate for the purposes of drawing the attention of persons to the existence of this Act. For this purpose, the relevant land registration official is the Registrar of Titles or other proper officer of the State or Territory in which the airport is situated.

Part 3—Restrictions on ownership of airport‑operator companies

Division 1—Simplified outline

38 Simplified outline

The following is a simplified outline of this Part:

• Airport‑operator companies are subject to the following ownership restrictions:

(a) a 49% limit on foreign ownership;

(b) a 5% limit on airline ownership for certain airports;

• Those limits relate to a person’s stake in a company.

• A person’s stake includes the interests of the person’s associates.

• There are 4 different types of stake. The main types are:

(a) percentage of total paid‑up share capital; and

(b) percentage of voting power.

• The ownership restrictions will be breached if any type of stake goes over the relevant limit.

• Stake and other technical expressions used in this Part are defined by the Schedule.

• The central management and control of an airport‑operator company must be exercised at a place in Australia.

• A majority of the directors of an airport‑operator company must be Australian citizens and/or Australian residents.

• The regulations may require records to be kept, and information to be given, for purposes relating to the ownership restrictions.

Division 2—Definitions in Schedule

39 Definitions in Schedule

The Schedule sets out definitions of expressions used in this Part.

Division 3—49% limit on foreign ownership

40 Meaning of unacceptable foreign‑ownership situation

For the purposes of this Act, an unacceptable foreign‑ownership situation exists in relation to an airport‑operator company if there is a group of foreign persons who hold, in total, a particular type of stake in the company of more than 49%.

Note 1: A group can consist of a single foreign person—see the Schedule.

Note 2: A person’s stake includes the interests of the person’s associates—see the Schedule.

41 Acquisitions of shares

If:

(a) a person, or 2 or more persons under an arrangement, acquire shares in a company; and

(b) the acquisition has the result, in relation to an airport‑operator company, that:

(i) an unacceptable foreign‑ownership situation comes into existence in relation to the company; or

(ii) if an unacceptable foreign‑ownership situation already exists in relation to the company—there is an increase in the total of any type of stake held by any group of foreign persons in the company; and

(c) the person or persons mentioned in paragraph (a) knew, or were reckless as to whether, the acquisition would have that result;

the person or persons mentioned in paragraph (a) are guilty of an offence punishable on conviction by a fine not exceeding 400 penalty units.

42 Compliance by airport‑operator company

(1) An airport‑operator company must take all reasonable steps to ensure that an unacceptable foreign‑ownership situation does not exist in relation to the company.

(2) A company commits an offence if:

(a) the company is required to take steps under subsection (1); and

(b) the company engages in conduct; and

Penalty: 500 penalty units.

43 Remedial orders

(1) If an unacceptable foreign‑ownership situation exists in relation to an airport‑operator company, the Federal Court may, on application by the Minister or the company, make such orders as the court considers appropriate for the purpose of ensuring that that situation ceases to exist.

(2) The Federal Court’s orders include:

(a) an order directing the disposal of shares; or

(b) an order restraining the exercise of any rights attached to shares; or

(c) an order prohibiting or deferring the payment of any sums due to a person in respect of shares held by the person; or

(d) an order that any exercise of rights attached to shares be disregarded.

(3) Subsection (2) does not, by implication, limit subsection (1).

(4) In addition to the Federal Court’s powers under subsections (1) and (2), the court:

(a) has power, for the purpose of securing compliance with any other order made under this section, to make an order directing any person to do or refrain from doing a specified act; and

(b) has power to make an order containing such ancillary or consequential provisions as the court thinks just.

(5) The Federal Court may, before making an order under this section, direct that notice of the application be given to such persons as it thinks fit or be published in such manner as it thinks fit, or both.

(6) The Federal Court may, by order, rescind, vary or discharge an order made by it under this section or suspend the operation of such an order.

Division 4—5% limit on ownership by airlines of airport‑operator companies for certain airports

44 Meaning of unacceptable airline‑ownership situation

(1) For the purposes of this Act, an unacceptable airline‑ownership situation exists in relation to an airport‑operator company for an airport and in relation to a particular airline if the airline holds a particular type of stake in the company of more than 5%.

Note: A person’s stake includes the interests of the person’s associates—see the Schedule.

(2) The regulations may specify that subsection (1) does not apply to:

(a) specified airports (not being core regulated airports); or

(b) specified airports (not being core regulated airports) in specified circumstances.

45 Acquisitions of shares

If:

(a) a person, or 2 or more persons under an arrangement, acquire shares in a company; and

(b) the acquisition has the result, in relation to an airport‑operator company, that:

(i) an unacceptable airline‑ownership situation comes into existence in relation to the company and in relation to an airline; or

(ii) if an unacceptable airline‑ownership situation already exists in relation to the company and in relation to an airline—there is an increase in any type of stake held by the airline in the company; and

(c) the person or persons mentioned in paragraph (a) knew, or were reckless as to whether, the acquisition would have that result;

the person or persons mentioned in paragraph (a) are guilty of an offence punishable on conviction by a fine not exceeding 400 penalty units.

46 Compliance by airport‑operator company

(1) An airport‑operator company must take all reasonable steps to ensure that an unacceptable airline‑ownership situation does not exist in relation to the company.

(2) A company commits an offence if:

(a) the company is required to take steps under subsection (1); and

(b) the company engages in conduct; and

Penalty: 500 penalty units.

(3) Strict liability applies to paragraph (2)(a).

Note: For strict liability, see section 6.1 of the Criminal Code.

47 Remedial orders

(1) If an unacceptable airline‑ownership situation exists in relation to an airport‑operator company, the Federal Court may, on application by the Minister or the company, make such orders as the court considers appropriate for the purpose of ensuring that that situation ceases to exist.