BAA Told To Sell Three Airports

The Competition Commission (CC) has confirmed that, subject to final consultation, it will require BAA to sell both Gatwick and Stansted airports as well as Edinburgh airport.

It also proposes to introduce measures to ensure that investment and levels of service at Heathrow, and possibly Gatwick and Stansted, meet more effectively the needs of airlines, passengers and other airport users. At Aberdeen airport, it is proposing measures to promote investment linked to rebates on charges.

The CC also intends to make recommendations to the Government on a more effective, and ultimately more flexible, system of airport regulation and also on aspects of government airports policy.

Christopher Clarke, Chairman of the BAA Airports inquiry, said: "Having provisionally identified competition problems at each of BAA's seven airports, we are proposing remedies which address them directly and comprehensively through a combination of divestment and other measures to improve investment and levels of service.

"The most effective way to introduce competition in the South-East and in lowland Scotland is to require the three London airports and the two principal Scottish airports to be separately owned. Hence we are proposing the sale of Gatwick, Stansted and Edinburgh airports to new independent owners with the operating capabilities and financial resources to develop each of them as effective competitors."

However, BAA Chief Executive Colin Matthews said he does not believe that the CC has set out compelling evidence to support its view that selling Stansted as well as Gatwick will increase competition, and remain concerned that its proposed remedies may actually delay the introduction of new runway capacity.

He said: "In Scotland, the Commission has not provided any substantial evidence to support its view that Edinburgh and Glasgow would compete under separate ownership, and we believe there is no justification for specifying which of these airports should be sold.

"We will continue to make our case to the Competition Commission."


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