Article 28 — Cost risk sharing mechanism

1.       In respect of the incentive schemes referred to in Article 11(2), a cost risk sharing mechanism shall be applied. Under that mechanism, differences between determined costs included in the performance plan and actual costs shall be shared between air navigation service providers and airspace users, in accordance with the provisions of this Article.

2.       The differences referred to in paragraph 1 shall be shared as follows:

(a)      where, over the whole reference period, actual costs fall below the determined costs, the air navigation service provider or the Member State concerned shall retain in full the resulting difference;

(b)     where, over the whole reference period, actual costs exceed the determined costs, the air navigation service provider or Member State concerned shall cover in full the resulting difference.

3.       Paragraph 2 does not apply if the differences between determined costs and actual costs result from at least one of the following changes:

(a)      unforeseen changes in costs of new and existing investments;

(b)     unforeseen changes in costs referred to in the third subparagraph of Article 22(1);

(c)      unforeseen and significant changes in pension costs established in accordance with Article 22(4) resulting from unforeseeable changes in national pensions law, pensions accounting law or unforeseeable changes in financial market conditions, on the condition that such changes in pension costs are outside the control of the air navigation service provider and, in the case of cost increases, that the air navigation service provider has taken reasonable measures to manage cost increases during the reference period;

(d)     unforeseen and significant changes in costs resulting from unforeseeable changes in interest rates on loans that finance costs arising from the provision of air navigation services, on the condition that such changes in costs are outside the control of the air navigation service provider and, in the case of cost increases, that the air navigation service provider has taken reasonable measures to manage cost increases during the reference period;

(e)     unforeseen and significant changes in costs resulting from unforeseeable changes in national taxation law or other unforeseeable new cost items not covered in the performance plan but required by law.

The determined costs relating to the costs referred to in this paragraph shall be identified and categorised in the performance plan, in accordance with point 3.3(h) of Annex II.

The differences between determined and actual costs referred to in this paragraph shall be identified and explained annually in accordance with Annex VII and Annex IX.

4.       In respect of the unforeseen changes in costs referred to in point (a) of paragraph 3, the differences between determined costs and actual costs shall be shared as follows:

(a)      where, over a calendar year or over the whole reference period, actual costs fall below the determined costs, the air navigation service provider or the Member State concerned shall reimburse the resulting difference to airspace users, through a reduction of the unit rate in year n+2 or in the following reference period, unless, based on a detailed justification of the air navigation service provider, the national supervisory authority decides, after consultation with airspace users' representatives, that the air navigation service provider shall not reimburse a part of the resulting difference;

(b)     where, over a calendar year or over the whole reference period, actual costs exceed the determined costs by not more than 5 %, Member States may decide that the resulting difference is recovered from airspace users by the air navigation service provider or the Member State concerned, through an increase of the unit rate in year n+2 or in the following reference period, subject to the approval by the national supervisory authority of a detailed justification provided by the air navigation service provider in particular as regards the need to increase capacity and after consultation with airspace users' representatives.

Where, during the reference period, air navigation service providers intend to add, cancel or replace major investments with respect to information on major investments identified in the performance plan in accordance with point 2.2(b) of Annex II, these changes shall be approved by the national supervisory authority, after consultation of airspace users' representatives.

5.       In respect of the unforeseen changes in costs referred to in point (b) of paragraph 3, the differences between determined costs and actual costs shall be shared as follows:

(a)      where, over a calendar year, actual costs fall below the determined costs established for that calendar year, Member States shall reimburse the resulting difference to airspace users through a reduction of the unit rate in year n+2;

(b)     where, over a calendar year, actual costs exceed the determined costs established for that calendar year, Member States shall recover the resulting difference from airspace users through an increase of the unit rate in year n+2.

6.       In respect of the unforeseen changes in costs referred to in points (c), (d) and (e) of paragraph 3, the differences between determined costs and actual costs shall be shared as follows:

(a)      where, over a calendar year or over the whole reference period, actual costs fall below the determined costs, the air navigation service provider or the Member State concerned shall reimburse the resulting difference to airspace users through a reduction of the unit rate in year n+2, in the following reference period or in the following two reference periods if the amounts to be recovered impact the unit rate in a disproportionate manner;

(b)     where, over a calendar year or over the whole reference period, actual costs exceed the determined costs, Member States may decide that the resulting difference is recovered from airspace users by the air navigation service provider or the Member State concerned, through an increase of the unit rate in year n+2, in the following reference period or in the following two reference periods if the amounts to be recovered impact the unit rate in a disproportionate manner.

7.       National supervisory authorities shall verify annually whether air navigation service providers apply correctly the provisions of this Article. National supervisory authorities shall draw up a report by 1 September of year n+1 on the changes in costs referred to in paragraph 3 which occurred in year n. The report shall be subject to consultation of airspace users' representatives.

National supervisory authorities shall also include in the report which is due by 1 September of the year following the final year of the reference period the balance over the whole reference period in respect of the unforeseen changes in the costs referred to in points (a), (c), (d) and (e) of paragraph 3.