Fed Nav’s new fees: how it works

Here’s why northern airlines are getting hit with new navigation fees they’ll be forced to pass on to consumers.



The private corporation set up to provide air navigation services will begin charging user fees on national and international flights within Canadian airspace this fall.

The federal government turned over control of the air navigation system (ANS) to Nav Canada in November, 1996 for $1.5 billion.

The private-sector, non-profit corporation is now responsible for providing all air navigation requirements to national and international carriers flying in domestic air space and Canadian-controlled international air space.

It’s the first fully privatized corporation in the world to own and operate a country’s air navigation service.

Prior to November, 1996, the federal government, through Transport Canada, charged a transportation tax to airline passengers. This tax paid for most of the system and the federal government made up the difference.

But Ottawa is phasing out this tax and its funding. Nav Canada, under the Civil Air Navigation Services Commercialization Act, has developed a plan to collect the hundreds of millions of dollars it needs to operate the service annually. It plans to implement a number of new fees during the next two years.

Air navigation services include traffic control, flight information, weather briefings, airport advisory services and approach aids.

The corporation will start collecting new fees in November for aircraft weighing more than 5.7 tonnes ­ carriers heavier than a Twin Otter. Nav Canada will introduce new fees for lighter aircraft next November.

The new charges include fees for taking off and landing at Canadian airports (terminal fees) and fees, based on aircraft weight and distance flown (enroute fees), for flying within Canadian airspace.

Nav Canada is also introducing an oceanic fee for flights that pass through Canadian airspace, but don’t take off or land.

Oceanic charges would be $140.51 per flight and would affect an estimated 240,000 flights annually.

Nav Canada allowed two months for consultation within the airline industry on proposed user fees for the larger aircraft.

Responses to the proposed rate structure had to be submitted to the corporation by Wednesday. Consultation on rates for smaller aircraft will begin in early 1998.

Nav Canada is expected to submit its proposed rates and the responses to its fees to the federal transport minister for approval for implementation November 1.

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