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Commonwealth act
This Act has been repealed and is no longer in force. It is retained for historical reference.
What this Act does
Who it affects
Core mechanical changes and powers
Formal approval and validation: The agreement between the Commonwealth, the Commission and Ansett is approved by the Act, and the Commission is taken to have had power to enter it and to do what it provides (s 5–6 and Schedule). The Schedule sets out detailed obligations and procedures.
Two‑operator structure for trunk routes: The parties agree to act so that only the Commission and Ansett operate scheduled domestic passenger services over the entire trunk‑route network (Schedule cl 6). "Trunk routes" and "trunk route centres" are defined in the Schedule (Schedule cl 6(1)(e)). Some limited exceptions for prescribed routes and specialised services are provided (Schedule cl 6(1)(b)–(d); cl 6(2)).
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Direct links to the current provisions in Airlines Agreement Act 1981.
Zoe has indexed the source text for search and analysis. Use the official register for the original document and download formats.
View on official registerSourced from the Federal Register of Legislation (legislation.gov.au), CC BY 4.0.
Fares regulation via an Independent Air Fares Committee: The agreement anticipates legislation creating an Independent Air Fares Committee to oversee and determine fare components, conduct cost allocation reviews, major and minor reviews of economy fares, and approve discount fares (Schedule: Independent Air Fares Committee outline). The Committee’s procedures, publicity of decisions and time limits are described in the outline.
Import and equipment controls: The Act requires amendments to the Customs (Prohibited Imports) Regulations so the Secretary to the Department of Transport must approve imports of aircraft, airframes or aircraft engines and take the agreement into account when deciding (s 8(1)(a); the text inserts a new regulation 4n). The Commonwealth also undertakes to amend the Airlines Equipment Act 1958 to place conditions on other operators importing larger turbo‑jet aircraft and to maintain equal capacity allocation for the Commission and the Company (Schedule cl 8–9).
Reporting and transparency obligations: The Commission and Ansett must deliver audited financial information on trunk‑route operations and overall airline operations to the Minister each year for tabling in Parliament (Schedule cl 13, cl 11, cl 23). The Committee’s decisions and reasons are to be published except where trade secrets are at stake (Independent Air Fares Committee outline).
Rural service maintenance and exit rules: The parties undertake to maintain rural services (Schedule cl 12(1)), with a procedure for an operator to notify the Commonwealth and potentially cease an unprofitable rural service after demonstrating sustained losses, with review by the Secretary or an independent chartered accountant if disputed (Schedule cl 12(2)–(6)).
Equality and Commonwealth undertakings: The Commonwealth agrees to treat the Commission and Ansett substantially equally in matters such as loan guarantees, import licences and airport facility allocation and not to discriminate against either (Schedule cl 20). It also undertakes to recover civil aviation facility costs from the industry, with rules on including fuel taxes in revenue offsets and limits on fuel tax increases relative to motor spirit (Schedule cl 10).
Who pays, who decides, and how behaviour changes
Who pays: The agreement records that the Commonwealth will seek to recover the costs of civil aviation facilities from the air transport industry (Schedule cl 10(1)), and that receipts such as duties or taxes on aviation fuel count as revenue offset (Schedule cl 10(2)). Operators remain responsible for compliance costs tied to reporting, participation in Committee processes and any undertakings given when importing aircraft (Schedule cl 13; cl 9).
Who decides: The Minister and Department of Transport gain discretion over import permissions and some service approvals (s 8; Schedule cl 6(1)(d), cl 9). The Independent Air Fares Committee (to be established by later legislation) is given decisive powers over fare-setting reviews and discount fare approvals (Independent Air Fares Committee outline). Dispute resolution between the Commission and Ansett is handled by an arbitrator agreed between them or, failing agreement, a Federal Court Justice (Schedule cl 7(6)–(9)).
Behaviour changes required: The Commission and Ansett are contractually bound to coordinate on capacity, fares consultations and other operational matters (Schedule cl 7(4)–(10)). They must avoid operating restricted‑hour aircraft during curfew hours (Schedule cl 16). Other operators face regulatory barriers to entering trunk routes (Schedule cl 6, cl 9 and s 8 amendments). The Commonwealth must present proposed additional trunk‑route agreements to both Houses and not enter them if either House disapproves within 15 sitting days (s 7).
Costs, incentives, trade‑offs and implementation risks (source‑grounded)
Concentrated benefits: The agreement explicitly secures the position of the two named parties (the Commission and Ansett) as the primary trunk‑route operators and grants them procedural and regulatory arrangements (s 5; Schedule cl 6). The mechanics create concentrated legal and regulatory advantage for those parties.
Diffuse costs and barriers: The framework imposes import controls (s 8; Schedule cl 9) and a two‑operator arrangement for trunk routes (Schedule cl 6) that create regulatory barriers for other potential entrants. Those controls alter incentives for new entrants: to obtain permission to import larger aircraft a non‑party operator would face conditions and undertakings (Schedule cl 9(1)).
Compliance burdens and administrative discretion: The Secretary to the Department of Transport is given power to grant or refuse import permissions and to delegate that power (s 8(1)(a) inserting reg 4n(1)–(6)). The Independent Air Fares Committee, once established by separate legislation, will have discretion to conduct different types of reviews in public or private and to publish or withhold findings (Independent Air Fares Committee outline). The parties must supply audited financial information to the Minister (Schedule cl 13), which is a recurring administrative requirement.
Trade‑offs and opportunity costs: The agreement trades open entry on trunk routes for a managed two‑operator structure and regulatory oversight of fares. The Commonwealth accepts obligations (for example, to treat the two operators substantially equally (Schedule cl 20)) and to legislate for a fares Committee, while the operators accept reporting, consultation and limitation obligations. Implementing this framework requires continuing administrative capacity (Committee operations, Secretary’s import decisions, arbitration and accounting reviews).
Implementation risk and enforcement mechanics: Many provisions depend on complementary legislation (e.g., the Committee Act, amendments to Customs regulations and to the Airlines Equipment Act) before full effect (Schedule cl 1(3), cl 2). The agreement sets out dispute and arbitration procedures (Schedule cl 7(6)–(9); cl 12(5)–(6)), and the Secretary and independent experts have roles in factual determinations (Schedule cl 12). Enforcement of some undertakings (for example, conditions tied to aircraft import approvals) is to be managed through those legislative and regulatory mechanisms (Schedule cl 9(1)).
Termination and duration
Bottom line (mechanical):