More than 350 delegates attended this morning's 16th ACI Europe Trading Conference in Monaco where Frank O?Connell, President of the European Travel Retail Council and Retail Director at Dublin Airport Authority addressed the important security

issue.

Speaking to a packed conference hall, O?Connell began by declaring that he was assuming a fair bit of knowledge on the part of the audience related to the subject.

He said the reality is that the industry is facing the single biggest threat to its business and particularly in the area of wines and spirits, but he added that this is a very complex mix of issues with no simple quick fix solutions.

O'Connell said that the European Commission is best placed to take the initiative on this issue, but if it doesn't then the industry could face ‘a free for all’ as nations take their own local actions and sales of liquids to transit passengers could even be eliminated almost by default.

The situation will probably get worse before it gets better, he said, even though ICAO has now made their own (non binding) recommendations for implementation of certain guidelines by March 1.

But the problem he said is that some countries are adapting the rules to local circumstances, so introducing unpredictable elements. Random legislating like this will only increase customer confusion, said O'Connell with the possible outcome being that transfer passengers may not be able to buy liquids at all if the current situation doesn't change.

O'Connell cited what is happening in Australia as an example where under current proposals all passengers will have to be screened at the last port of call before returning home, which effectively means that any liquids carried by them will be confiscated at this point.

He said that the bottom line for these travellers is that gate deliveries will be required at the first point of departure and that is a real problem for everyone.

At the same time he said that Australia is separately negotiating bi-lateral agreements with several Asian countries, but these rules will have difficulties of their own.

He said that while this is an extreme example of what can happen, it is indicative of what can happen if the issue gets out of control.
He said common airport standards are vital with clear retail supply chain safety assurances and a common specification for the plastic bag to contain travellers' hand luggage liquids/gels.

He said the good news is that the basic specifications for this bag have now been agreed by all 27 member states and the bags are now in production. But the big challenge now is to get agreement from the US on the bag specification, he said. The important aspect about the bag is that it is clearly tamper evident, emphasised O'Connell, along with the receipt clearly visible inside showing the airport, the flight number and the date of purchase.

While O'Connell said he was satisfied that much progress had been made with the bag, he said the transfer/confiscation issue was far from resolved.

He said that the one issue upon which EU member states agree wholeheartedly is that the confiscation of thousands of bottles of duty free liquor and gels is untenable. This alone is contributing to the pressure on the Commission to solve this problem, said O?Connell.

He said it is still open to question whether ICAO will be able to act quickly enough to solve this and it would not be helpful if it drags out for another six to eight months.

Mutual recognition of security systems between the US and Canada is also vital he said. In North America he said that IAADFS and ACI North America need to replicate similar messages to the TSA to get agreement and the same also applies to other regions where ETRC is working closely with the regional duty free associations of APTRA, MEDFA and ASUTIL. O'Connell said that ACI World also has a big role in this to channel these recommendations through to ICAO.

O'Connell also called upon EU airports, suppliers and retailers to maintain pressure on their own national governments. He told the audience that this is where they could make a difference. He noted that a large number of airports represented in the room were state owned, so providing a ready channel of communication to their governments.

He said elaborate detail was not necessary, as long as governments are made aware of the importance of the issue. Outside the EU he said that the most important part of the equation is mutual recognition of non EU airport security systems.

Looking at the short term future, O'Connell said that key dates are February 26 and 27 when the duty free working group of ICAO meets and hopefully this will prove productive. Then on February 28 a SAGAS meeting will look at the present position and hopefully include the transfer issue.

Then on March 22 the Irish Minister for Transport is likely to raise the issue at the Commission and O'Connell said it is important that other member states support him so he is not left isolated.

In conclusion O'Connell said this is effectively a time bomb with a slow burning fuse where passengers are purchasing goods in good faith and having them confiscated. He said an even bigger downside of this is that the industry won't necessarily see the impact of this on their purchasing behaviour for many months to come and possibly only when these passengers are travelling the next time around.

O'Connell said the current system is undermining consumer confidence in airport retailing. He said tens of thousands of passengers are having their goods taken away from them and it is getting to the point where the industry is merely producing fine Cognac and whiskies just to see them poured down the drain.