Highlights of the Bills

• The Bill sets up a Civil Aviation Authority (CAA) to replace Directorate General of Civil Aviation (DGCA) as the civil aviation safety regulator.

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• CAA shall discharge all the duties currently assigned to DGCA, including safety oversight, environmental regulation, licensing, international coordination, advising the government and industry development.

• CAA shall also be responsible for protection of consumer interests and training of civil aviation personnel including its own staff.
• Appeals against CAA’s decisions may be made to the government.

• All funds received by CAA including central government grants and fees and charges shall be credited to the Civil Aviation Authority Fund.

• Non-compliance of CAA’s directions carries a fine of Rs 1 lakh in the first instance, Rs 2 lakh in the second instance and up to Rs 4,000 per day for continued contravention.

Key Issues and Analysis

• The Bill does not create an independent appellate tribunal to review CAA’s decisions.  The appellate body (Ministry) is also the administrative Ministry for Air India, Pawan Hans and Airports Authority of India.  This may lead to a conflict of interest.

• Two of CAA’s functions, i.e. checking anti-competitive air fares and consumer protection, may overlap with functions of the Competition Commission of India and consumer protection forums/courts.

• Like DGCA, CAA will need approvals from the government for creation of posts of officers and other employees.  This may not bring about the intended acceleration in CAA’s recruitment process.

• CAA’s funding structure could be a move towards the regulator’s costs being met by the users.  There are arguments both for and against adoption of a self-funded model over the government-funded model.

• The Bill does not address some of the recommendations of high level committees regarding DGCA, like delegating oversight of air fares to the Competition Commission, creation of an Indian Civil Aviation Service and establishment of a separate body for vigilance.

Read the complete analysis here