This is the official presentation released to the media by the Mactan Cebu International Airport (MCIA) during the second heading held at Waterfront Hotel on October 7, 2014 and was presented by GM Nigel Villarete.

1. Upgrading our airport
The passenger service charge
Mactan-Cebu International Airport

2. OUR NEIGHBORS ARE UPGRADING
International airports in Singapore, Indonesia, Thailand, and Vietnam are
being improved. To pay for the facilities being built and for the
maintenance, the passenger service charges have also been increased.

4. Note the increases in the passenger service charge at
the Changi international airport in Singapore

5. 2010 news item

6. 2012 announcement

8. Indonesia

11. In Thailand

13. In Vietnam

14. WHY ARE THEY INCREASING FEES?
Based on policies of the International Civil Aviation Organiztion (ICAO),
users of the airport, meaning the passengers, shall bear the cost of the
improvements and the airport maintenance.

16. SECTION II. ICAO’S POLICIES ON AIRPORT CHARGES
The cost basis for airport charges
•1. As a general principle it is desirable, where an airport is
provided for international use, that the users shall ultimately
bear their full and fair share of the cost of providing the
airport. …
•... In determining and allocating the total cost to be met by
charges on international air services, the list in Appendix 1
may serve as a general guide to the facilities and services to
be taken into account.

17. SECTION II. ICAO’S POLICIES ON AIRPORT CHARGES
The cost basis for airport charges
•“2. In determining the cost basis for airport charges, the
following principles should be applied: i) The cost to be
allocated is the full cost of providing the airport and its
essential ancillary services, including appropriate amounts for
cost of capital and depreciation of assets, as well as the costs
of maintenance, operation, management and administration.“
•ICAO further recommended that … the States: i) Permit the
imposition of charges only for services and functions which
are provided for, directly related to, or ultimately beneficial
for, civil aviation operations;"

18. WHAT ARE THE PLANS FOR MCIA?
Under PPP agreement, the GMR-Megawide will build a new international
terminal and expand the existing one. The concessionaire will also
operate the landside. MCIAA will take care of airside operation.

19. The Masterplan

20. GMR-Megawide

23. Board
Resolution
Number
Date Increase of the Terminal Fees Date of
Effectivity
94-158 March 18, 1994 IPT – P 300 per pax to P 350.00
DPT P 10.00 per pax to P 15.00 per pax
May 1, 1994
94 – 189 October 21, 1994 Increase in the Domestic Terminal, Fee
from P 15.00 to P 25.00 per passenger
October 21,
1994
98-417 March 23, 1998 Increase of Terminal Fee for
International Passenger from P 400 per
pax to P 500.00 per pax
May 4, 1998
99-478 May 28, 1999 Increase of Terminal Fee for
International Passenger from P 500 per
pax to P 550.00 per pax
July 1999
2005-1017 December 12,
2005
Increase of Domestic Terminal fee from
P 100.00 to P 200.00
January 1, 2006
Chronological List of MCIAA Terminal Fee Increase

24. Comparison with Other Countries
(2010 Data)
In Philippine Peso
Airport International Passenger Charge Domestic Passenger Charge
Changi Airport, Singapore 925 925
Suvarnabhumi Bangkok,
Thailand
926 132
Cambodia 1049 252
Kuala Lumpur, Malaysia 855 118
Vietnam 755 88
Bali, Indonesia 755 200
Jakarta, Indonesia 755 200
Taiwan Taoyuan International
Airport
420 Cannot find any information
Seoul Gimpo International
Airport, Korea
1028 147
Kansai Airport, Japan 1397 Cannot find any information
Narita, Japan 1339 Cannot find any information

25. Passenger Service Charges - Worldwide
Airport International ($) Domestic ($)
Bali 16.9 6
Jakarta 16.9 6
Cambodia (All) 25 6
Hong Kong 15.6 -
Singapore 27.2 -
Macau 13.75 -
KLIA 20 -
Istanbul 19.4 5.2
Bangkok 21 3
Narita 24.4 -
Wellington 19.89 8.9

26. Inflation
P550.00 international rate set in July 1999
P200.00 domestic rate set in January 2006
And we complain that we are behind our neighbors.

27. Particular PHP
Charge to MCIA 171.57
Airline Collection Charge (3.5%) 7
VAT at 12% 21.43
Total 200
Domestic - Existing
Particular PHP
Charge to the Concessionaire 181
Charges to MCIAA 76.4
Airline Collection Charge (3.5%) 10.5
VAT at 12% 32.1
Total 300
Domestic - Proposed

28. Particular PHP
Charge to MCIA 348.21
VAT 12% 41.79
National Govt. Tax 100
NACAHT Charges 60
Total 550.00
International - Existing International - Proposed
Particular PHP
Charge to Concessionaire 383
Charges to MCIAA 143.8
VAT 12% 63.2
National Govt. Tax 100
NACAHT Charges 60
Total 750.00

29.  MCIAA’s financial revenue stream decreases from about P1.5 Billion a
year to only P500 Million after the Concession Agreement
 Grantors (government) shall be responsible for the Airside Operations
and Maintenance (O&M) Services. The Concessionaire shall be
responsible for Landside O&M Services.
 MCIAA’s revenue stream will not be sufficient to undertake all the major
rehabilitation and improvements, and maintain its status as a duly
certificated Aerodrome of the Republic of the Philippines.
 It is preferable to comply with ICAO’s Policies on PSC than to depend on
annual appropriations from the National Government. Our experience
with the latter shows us the disadvantages of this scheme, resulting to
delays and congestions in many of our airports.
Why do we need to increase the PSC?

30. Thank You