OFT To Examine Competitiveness Of UK Airports Market

by Robin Pilgrim, LawAndTax-News.com, London

26 May 2006

The UK's Office of Fair Trading (OFT) announced on Thursday that it is considering examining the UK airports market, with a view to establishing if the current market structure works well for consumers.

The Office explained that:

"The OFT has a public duty to keep markets under review and routinely reviews the economy to identify markets that may not work well for consumers that would be possible candidates for market studies, which in turn could lead to possible referral to the Competition Commission."

"One of the possible candidates being considered relates to the structure of UK airport markets."

It continued:

"In the context of the current bid offer for BAA and the European Commission's clearance yesterday of the proposed takeover, it would be inappropriate for OFT to consider this issue further at this time without making public that the structure of the market may be reviewed. OFT plans to make a detailed announcement by the end of June on the scope of any review in this area."

BAA owns and operate airports which handled 63 per cent of air passengers beginning or ending their journey in the UK in 2005. Within the London area, this figure rises to 92 per cent of all air passengers and within Scotland to 86 per cent of all air passengers.

Responding to the OFT announcement on Thursday, BAA admitted that the notification of a possible probe had come as a "complete surprise" to the company, but stated that it would "give careful consideration to the OFT’s announcement and will cooperate with any enquiry".

Recommended