Passport-less travel is on the way, says DAA boss

DAA chief executive Dalton Philips has said that UCD law students should strongly consider careers in sectors in which Ireland excels.

These sectors include tech, pharma and aviation, he told the students at the A&L Goodbody-sponsored Student Legal Convention, in the moot court in the Sutherland School of Law on Wednesday, 12 February. 

He advised the students to follow their passions, but also to talk to the experts in the fields in which they wish to work.

“Know your stuff so that when you hit that interview, you’re not blagging!

“You can’t BS your way into a good job,” he warned.

And he said that different experiences build a CV, whether that’s working in McDonald’s or Tesco.

Building a cv

“That tells me, as an employer, a lot,” he said. “There are different ways to build your CV. Different journeys can lead to the same place.

He suggested students who wanted to work in aircraft leasing could get a start by working in bus leasing, then go from there.

Philips himself started as a graduate trainee in supermarkets, gutting fish in Hong Kong within a month of graduating from UCD in the late 1980s, when only three of his classmates found jobs in Ireland.

However, with parents who were enthusiastic amateur pilots, aviation was always in his blood, so he applied for, and won, the chief executive role at DAA when it came up in 2017.

Competing

He warned the law students at the sixth annual SLC that they would be competing against one billion Chinese who work seven days a week.

“Your competition is not somebody sitting next to you in class,” he said, and in a global market they must “work their asses off”.

Passport-less travel

The DAA chief said that biometric boarding would soon lead on to passport-less travel, though this would present many legal challenges.

Mr Philips said that Ireland was totally exposed at a macro-economic level, as a small open economy, to events such as trade wars, Brexit, oil prices, and mass epidemics, such as coronavirus.

“But sometimes you’ve just got to hold your nerve,” he said, “and invest and work through economic cycles.”

As an example, he pointed to the new runway being built at Dublin Airport.

“There hasn’t been a new runway built in Europe in the last 25 years,” he said.

“There is an argument that this is the last one that will ever be built.”

Complex problems

He said that the Dublin Airport runway project presented many complex and challenging legal problems.

The sod was turned on Valentine’s Day last year, with completion slated for the end of 2020.

“But there are lots of legal minefields to work our way through there,” he said.

The capital’s airport is now at total capacity, and the second runway will relieve bottlenecks, but also present new challenges for security, piers, aprons and gates.

“The bottlenecks will just shift elsewhere,” he said.

DAA is investing €2 billion in improving infrastructure over the next five years.

“Think of all the legal contracting that has to be done,” he told the students, “and the challenges with those contracts and working your way through that, with all the different providers.

"It’s immensely complex.”

Bucket behind a boat

The DAA chief said that planning in Ireland “is a disaster. It’s a bucket behind a boat. It’s hugely complex and it’s hard to get stuff done”.

Even with the best legal minds, things gets slowed down, pointing out that, even to remove a portable structure at the airport required planning permission.

“That is the level of constraints that are placed on us as a business,” he said.

“This is going on the length and breadth of the country.”

However, the planning situation presented many legal opportunities that the young law students could end up tackling, he said.

Ireland is a world leader in aviation, founding both duty-free and the aircraft-leasing industries, Dalton Phillips said.

“Every two seconds, an aircraft takes off somewhere on the globe that has gone through an Irish leasing company – which gives a sense of the power of this sector,” he said.

Routes

“Dublin Airport has routes to 200 different cities around the world. There are very few places around the globe that you can’t get to, with one stop, from Dublin.”

“There is a flight every nine minutes to the UK from Dublin, and one every 40 minutes to the US.”

The aviation sector supports 130,000 jobs in total, while DAA itself employs 3,500 staff, and Dublin Airport 25,000.

“Cork is the country’s second biggest airport, and a real economic driver for the region, with €1 billion of foreign direct investment enabled by connectivity at the airport,” Philips said.

Eco-system

He added that DAA was a small part of the aviation eco-system. It is fully owned by the State, but highly commercial.

He described DAA as a hidden multi-national, operating in 14 countries, running both airports and duty-free outlets.

“We make a lot of money, which goes back as a big dividend to the exchequer,” he said.

DAA operates across 14 different countries, running six airports – Dublin, Cork, Dusseldorf, Paphos and Larnaca in Cyprus, and Riyadh in Saudi Arabia, where it operates a domestic terminal bigger than T2 in Dublin Airport.

DAA also runs duty-free in Barbados, Canada, New Zealand, and with a very strong presence in the Middle East.

World Cup

It handles all of the alcohol distribution in Qatar, and will source every drink sold during the upcoming soccer World Cup in 2022.

A total of 85 million passengers go through DAA airports each year, and 150 million use the duty free. 

Landing slots

Dalton Philips said that Dublin Airport is now so busy that it can be difficult to offer landing slots to airlines wishing to establish new routes.

He said passengers expect superb service, even though the airport is operating with constraint challenges.

“The whole thing is creaking.

"We have to give outstanding customer service, even in a capacity-constrained environment,” he said.

"We don’t want to be like JFK, where it’s a building site with an airport in the middle.”

He advised the students to join a business where the leadership knows what’s going on at the front line.

To this end, DAA has a ‘walk in my shoes’ system, whereby the top 70 of the company’s leadership spend one day a month doing a front-line shift, whether that is baggage, toilets, police or taxis.

He himself recently spent three hours clearing limescale from the wash-hand basin and urinal porcelain at Dublin Airport.

He learned that existing taps are a poor design, with too many grooves.

Not losing the distance from the front line is what ultimately pays the bills, Philips said, which is the passengers going through the airport.

“We have a rich aviation sector in Ireland,” he said, “and in 1909, just six years after the Wright brothers first flew, an Irishman, Harry Ferguson, built his own plane in Hillsborough and flew it in Ireland.” 

World leader

Ireland has always been a world leader in aviation, he said, and the concept of duty-free began in Ireland, at Shannon in 1947, with the first trans-Atlantic flights.

The aircraft leasing industry as we know it today also began in Ireland, when Tony Ryan founded Guinness Peat Aviation 1975.

“That really was the genesis of the entire leasing sector, which is so strongly associated with Ireland,” he said.

“Then of course, Ryanair started in 1984,” he said.

We are players internationally in aviation and right on top of our game globally, he said, pointing to the success of Avolon, AerCap and Ryanair.

Mr Philips said that 60% of all aircraft leased around the globe are Irish-registered.

High-end employment

During a panel discussion on Ireland’s aviation sector, Prof Noel McGrath (UCD School of Law) said: “Aviation is a hidden success story in Ireland, producing very high-end professional employment around the country.”

He added that UCD had been very involved in building the educational infrastructure to support the industry and its future development.

Joe O’Mara of KPMG’s aviation finance tax practice said: “Aviation is a very cyclical sector which has tended to have periods of growth of seven to eight years, followed by downturns.

“Now it’s in an uncharted period of growth of up to ten years. It’s in pretty robust health, and its tenth year of profitability.”

Collaborative

Head of global aviation finance PwC, Yvonne Thomson, said that development of the industry was done in a very collaborative way.

“Government was very supportive with the corporate tax regime, which is now under threat,” she said.

Thomas Conlon, Director UCD MSc Aviation Finance, said: “This industry, on a worldwide basis, has been a very strong growth story over the last 30 years, largely because of the movement into the middle class, particularly in emerging economies.

“In 1990, there were about 500 civil aircraft in China, and 2,500 in 2010. Last year, there were 6,000 aircraft in China. Airbus is suggesting a demand for 7,500 aircraft in China over the next 20 years,” he added.

“To get an aircraft from Airbus takes five years from placing an order, so we know from the supply side how many aircraft will be produced, because there are really only two manufacturers, Airbus and Boeing.

Transformed

Aer Lingus legal director Laurence Gourley said that his company had transformed its business model rapidly, from an Irish-focused state-owned, high-cost and high fares traditional carrier, to a 'value’ carrier, with Dublin as an international hub.

He said that in his 20 years at the airline, there had been so much change, it felt like four totally different businesses.

David Berkery (partner, A&L Goodbody) described the industry as a highly-leveraged one where debt was very important.

Former Young Scientist winner and CEO of Evervault, Shane Curran, said that Irish people were naturally good at sales.

“Technical skills are generally over-hyped,” he said.

“The best founders really understand the market, and are really good at finding markets that are both growing and big.”

“If you find the market and are really good at selling that dream to people, you will find the technical people to join in with you.”

Organising and leading a team is what leads to successful companies, he said, assuming one had a good product. 

Prosper

Josh Hogan (head of the financial services regulatory group, McCann FitzGerald) said that the legal environment was important for innovation to thrive and prosper.

“Dublin might be leading the field in some respects, because we have a very good eco-system for tech and finance and business generally, and long may that continue,” he commented.

Serial entrepreneur Colin Keogh (CEO of Rapid Foundation/ Forbes 30 under 30) told the conference about how he had started seven companies to date in his career.

Prof Orla Feely (vice-president for research, innovation and impact, UCD) said: “Research is big business for UCD, and research has become much more complex.

"The last financial year was our best ever, and we signed research contracts worth €151 million.

“The legal dimension around research and compliance has really escalated,” she said.

She concluded that, while Ireland was ramping up as an innovation economy, it was not yet ‘up there’ with the real leaders. 

Fintech

Ireland’s legal framework is facilitative of innovations such as fintech, because it can be tried out based on contracts, without being grounded in legislation, the convention heard.

The Accenture prototype workshop was cited as an example of an experimental ideas factory.

Flexibility, adaptability and fluidity were the cornerstones of innovation, the convention heard.

A friendly tax environment was good for business sentiment.

Diaspora

And the Irish diaspora, often primed ahead of time by Irish officials, has proved a huge help to fledgling entrepreneurs when they arrive in Silicon Valley.

During a discussion on the taxation of the digital economy, Dr Charles Garavan of UCD said that digital companies were much more mobile than bricks-and-mortar businesses.

Taxation of the digital economy was a question of ‘where’ multi-nationals should pay – where their people were located, where they sold their products, or where they booked their profits.

“Digital taxation is being sold politically as a tax on tech giants who are not paying their fair share. It will be interesting to watch as people realise it’s not going to be Google paying the tax – it’s going to be you, the customer,” said Dr Garavan. 

Presence

Lorraine Griffin (head of tax, Deloitte) said: “A lot of digital companies are able to carry on their business activities and engage with customers or users of their platforms, without having a physical presence in particular countries. 

“They can reach into countries, engage with customers, and they don’t need bricks and mortar, or people operating there on their behalf – yet they are getting access to a customer base.”

Ultimately, we can’t ring-fence the digital economy in Ireland, because the whole economy is digitising, she said.

Keavy Ryan, a corporate and M&A partner with event sponsor A&L Goodbody, said that the students would enjoy far greater freedom and flexibility in their future careers, unlike the 'battery hens' of previous eras.

"Ireland and its legal profession are changing as clients require more sophisticated technology solutions, as well as needing to meet increasing regulatory, economic and environmental requirements," Keavy Ryan said.

"This growing complexity means that lawyers must not only be technical experts in their own practice area, but they also must be able to collaborate with colleagues to solve multi-faceted problems."

Keavy thanked SLC organisers Eoin Quinsey and Róisín Rainey for their hard work in organising the event.