Wednesday, March 30, 2011

Regulator Stands By U.K. Airports Ruling

Regulator Stands By U.K. Airports Ruling : The U.K.'s competition regulator Wednesday upheld its decision that airport operator BAA Ltd. should be required to sell London's Stansted Airport and either airport in Edinburgh or Glasgow.

The provisional conclusion from the Competition Commission comes as little surprise. BAA had mounted a legal challenge to the original findings published in March 2009, but the Court of Appeal in October 2010 endorsed the regulator's report and the Supreme Court last month refused BAA permission to appeal further.

The Competition Commission had been asked to consider whether there had been any material changes in circumstances since it published its report in March 2009 that should give it cause to reconsider the implementation of the airport sales.

The commission remained convinced that the original decision was the right one for passengers and airlines, even in light of the government's decision to rule out further runways at London's airports, Chairman Peter Freeman said in a statement.

"Having examined the case closely, we are clear that many benefits will still arise without that expansion, by increasing competition and addressing detrimental effects from BAA's common ownership," he said.

BAA, a unit of Spain's Ferrovial SA, said it would carefully consider the decision. "We believe that there has been a material change in circumstances since the commission's report was published," it added.

It seems likely that regulators now will push ahead with plans to force the airport sales.

"Whilst there are reasonable concerns on setting a fair timetable for the sales process, it is also right that passengers and airlines should not have to wait indefinitely for the improvements that will arise from greater competition," the Competition Commission said.

BAA in 2009 sold London's Gatwick Airport for £1.5 billion ($2.4 billion) to Global Infrastructure Partners, an investment fund backed by Credit Suisse Group and General Electric Co. in what appeared to be a bid to head off a breakup. BAA also owns London's Heathrow Airport.

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