BAA response to the OFT’s report on the UK Airports market

BAA today responded to the OFT's consultation paper, published 12 December 2006, in which it signalled its intention to refer the supply of airport services by BAA to the Competition Commission (CC) for more detailed investigation.

Stephen Nelson, Chief Executive of BAA comments,
"I welcome the opportunity to have a thorough review of the UK airport market, but I am concerned at the OFT's narrow focus on the structure of BAA. The real problem for passengers is lack of capacity, not the structure of BAA. This shortfall is the result of a complex interplay of political, planning and environmental issues, all of which need examination.  There is a great opportunity over the coming years to deliver dramatic improvements for passengers using our airports, but this requires a regulatory system that encourages investment. I do not believe the current regulatory model in the South East fits this purpose."

BAA accepts that the airport market deserves study, but believes the OFT has adopted an uncritical approach to many of the issues raised in the report. In many key respects the market study, as it currently stands, is a weak basis for reference. 

More importantly, the market study does not set out a compelling case that BAA’s airports can compete more significantly, and serve the consumer interest better, under separate ownership.

BAA has been invited to offer undertakings in lieu of a reference. Because of BAA’s strong belief that separate ownership will not address the core problems facing airports in the South East, BAA does not consider it appropriate to offer such undertakings. There is, accordingly, no intention on the part of BAA to sell any of its airports.

Download BAA's response to the OFT (196KB PDF)

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