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BAA may be forced to sell three airports

BAA may be forced to sell three airports Fears over the dominance of BAA may mean that the authority will have to sell three of its seven UK airports, the Competition Commission has indicated.

In a scathing recommendation by the watchdog, BAA should also relinquish two of the three airports - Gatwick, Heathrow and Stansted – that it controls in the south-east.

The Competition Commission also ruled that it was not justified for BAA to control both Edinburgh and Glasgow airports in Scotland.

The regulator indicated that BAA's current ownership of airports in the UK was having "adverse consequences" for both airlines and passengers.

BAA, which is owned by Spanish company Ferrovial, has been the subject of criticism recently, most notably for severe delays experienced at Heathrow.

It was also ruled that the common ownership of Heathrow, Gatwick and Stansted was the cause for many recent problems endured by air passengers heading in and out of London.

Christopher Clarke headed up the inquest and said that BAA had demonstrated a "lack of initiative" about extended capacity and a "lack of responsiveness" to the needs of airlines.

The commission added in the report that "BAA has argued that there is no scope for competition to develop so long as there are capacity constraints".

"We take the opposite view. Unless the market is opened up to competition, there is a serious risk that the current capacity constraints will persist," the regulator added.

BAA's chief executive Colin Matthews described the ruling to BBC News as "flawed" and "counter-productive" and indicated that BAA has no intention of selling its largest airport, Heathrow.

A final decision is expected from the Competition Commission next April which will decide the future of airport ownership in the UK.


Airport News posted on 20 August 2008

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