Airlines warn more of disputes, court action with Aussie airports

SYDNEY - An industry group representing Australian and New Zealand airlines has warned of more disputes and court action after the Federal Government's decision to side with Australia's airports.

Dubbed 'the terminal wars' by local media, Airlines for Australia and New Zealand (A4ANZ) have been locked in a long-running campaign to introduce reforms across Australia's airports, describing their behavior as "monopolous".

As well as calling for a reduction in the cost of airport services for travelers in areas such as car parking and food, the group also say Australia's airports are demanding "unreasonable terms" in negotiations and that an independent umpire needs to be brought in to resolve these disputes.

In one such case, the national carrier Qantas has been locked in a legal battle with Perth Airport over millions of dollars in unpaid fees.

As a result, the Western Australian economy has missed out on an extra three return flights from Johannesburg per week, along the newly-proposed super long-haul route from Perth to Paris.

But despite a lengthy inquiry into these matters by Australia's Productivity Commission, on Wednesday evening the Government announced they would not adopt of any of the A4ANZ's recommended changes.

Instead, the Government will ask the nation's consumer watchdog - the Australian Competition and Consumer Commission (ACCC) - to increase monitoring of the airports in the interests of transparency.

In response, A4ANZ Chairman Professor Graeme Samuel said Government's refusal to act will hurt the economy and result in more ugly disputes between airlines and the country's airports.

"There will certainly be an increase in litigation as the only means of resolving disputes, and this is what harms investment and creates negative outcomes for the community," he said.

"As we are acutely aware at this time of year, air travel is a fundamental part of the Australian way of life. The aviation industry is essential to the economy, contributing over 100 billion Australian ($68 billion) dollars and supporting over 700,000 jobs."

"This issue is too important to simply ignore. Faced with no option but more disputes and litigation, we will continue to work closely with the consumer watchdog - the ACCC, other airport users and Australian travelers, towards achieving the necessary reforms in any way we can."