Competition Commission to rule on airports sale

BAA expected to be forced to sell two airports

The Competition Commission (CC) is expected to confirm that BAA must sell two of its airports.

The commission first ruled in 2009 that airport operator BAA would have to sell Gatwick and Stansted airports as well as either Edinburgh or Glasgow airport.

BAA then issued a series of legal challenges to the ruling, which ended with the CC findings being upheld and the commission considering whether there had been material changes in circumstances since the ruling.

This included the decision by the government to rule out further runways at London's airports.

In a provisional ruling in March this year, the CC said the sale of the airports was still fully justified and that passengers and airlines would still benefit from greater competition with the airports under separate ownership.

"We remain convinced that the original decision to require BAA to divest three airports including Gatwick is the right one for passengers and airlines," said CC chairman Peter Freeman at the provisional hearing.

Gatwick airport was sold to US-based investment fund Global Infrastructure Partners for around £1.5 billion in late 2009.

"We are clear that many benefits will still arise without that expansion, by increasing competition and addressing detrimental effects from BAA's common ownership," Freeman added.

"There now appears to be greater capacity available which will increase the potential for competition between the London airports.

"There has also been no cause to alter our view on the need for either Edinburgh or Glasgow to be under separate ownership."

The CC will continue to allow the airports to be sold in sequence with a small overlap between the two sales periods with Stansted to be sold first, he added.

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