By Ashley Erika O. Jose, Reporter

LOCAL CARRIERS are no longer pursuing their proposal for a terminal enhancement fee, the Civil Aeronautics Board (CAB) said, adding that carriers may explore options that do not require government approval.

“They are not pursuing it anymore. Because maybe they are making a judgment, there are many options for them. One is just increasing the fares by tucking it in or maybe partly absorbing (the high cost),” CAB Executive Director Carmelo L. Arcilla told reporters on the sidelines of an event last week.

Local airlines including Philippine Airlines, Cebu Pacific, and AirAsia Philippines have earlier sought CAB approval to impose a terminal enhancement fee amid higher charges at Ninoy Aquino International Airport (NAIA).

They proposed to collect a terminal enhancement fee of P150 for domestic roundtrip flights and up to P300 each way for international flights.

The airlines are seeking government approval to collect the terminal enhancement fee separately, as these will not be included in the fare.

If approved, the fee would be charged separately from the base fare and itemized distinctly on passenger receipts, similar to fuel surcharges and value-added tax.

Mr. Arcilla said the carriers’ proposal is “archived” for now, noting that the airlines have the right to increase fares to offset the high cost of operating at NAIA.

Since taking over NAIA operations in September last year, private operator New NAIA Infra Corp. (NNIC) has raised landing, takeoff, and other fees.

CAB said previously that some foreign carriers are also seeking to collect terminal enhancement fees to offset rising costs at NAIA.

However, these foreign airlines are also no longer seeking to collect such fees, Mr. Arcilla said, noting that these carriers did not formally file an application to impose terminal enhancement fees.

AirAsia Philippines said it is working closely with the government and industry partners to explore options to address adjustments in airport operational costs, including terminal enhancement fees.

AirAsia Philippines Communications and Public Affairs Head Steve F. Dailisan said in a Viber message that the airline supports initiatives that “enhance the overall customer journey.”

“I fully agree (with this move). It is indeed more inconvenient for passengers to pay separate fees for so many things related to their travel — everything should be incorporated to the cost of the ticket and paid only once,” Nigel Paul C. Villarete, senior adviser on public-private partnership (PPP) at Libra Konsult, Inc., said via Viber on Monday.

Mr. Villarete said it is understandable why airlines would want to collect it as a separate fee, but deciding to tuck it in the base fare would be the best option.

“I understand that the airlines don’t like this and will oppose it, but this is the way to go and the best option. Airlines can print the breakdown in the tickets for the passengers to see,” he said.

“It is a very convenient move, to hide the additional cost in the base fare. Blame will then be attributed to airlines, not the terminal operator. To the public, it is the same impact,” said Rene S. Santiago, an international consultant on transport development and former president of the Transportation Science Society of the Philippines.

Starting September this year, NNIC has also started collecting higher passenger service charge or terminal fee to P950 from P550 for international departures. The terminal fee for domestic departures was raised to P390 from P200.

AIR TALKSMeanwhile, Mr. Arcilla said CAB has also signed an agreement with Thailand which allowed local carriers like AirAsia Philippines to continue operating there through a third-country code-sharing agreement.

The recently signed deal amends the Philippines and Thailand’s existing air service agreement, Mr. Arcilla said.

A third-country code-sharing agreement involves carriers in two countries selling flights on a third country’s airline.

“Philippines AirAsia is 100% foreign owned but it is still a local carrier,” Mr. Arcilla said, adding that under the current air service agreement only locally controlled airlines are allowed to operate in Thailand.

In June, CAB said that the Philippines is also working on a code-sharing agreement with South Korean and Japanese carriers to expand connectivity between Manila and the US.