Budget airline Ryanair is taking the UK airport operator BAA to court, alleging the monopoly abuse of fuel levies.
BAA says Ryanair owes it £1m in landing fees
Ryanair said BAA introduced a charge on airlines to recoup the cost of building a fuel hydrant system at Stansted Airport in 1991.
It said BAA had given assurances in writing that the levy would end when the costs were recovered.
But Ryanair said BAA had broken these agreements. Separately, BAA is taking legal action against Ryanair.
Fees to rise
BAA says it is owed £1m ($1.8m) by Ryanair for landing fees at Stansted Airport, north-east of London.
The airport operator also said it would end its current landing contract with the Dublin-based carrier, resulting in an increase in the amount charged per passenger at Stansted.
A spokeswoman for BAA said the fees would rise to £4.89 per passenger, from £2.80.
The move could cost Ryanair, which handles 12.5 million passenger each year at Stansted, an extra £26m pounds annually.
Ryanair said BAA had recovered more than £34m in fuel levies over a 14 year period, which, it said, was three times the original cost of the fuel hydrant system.
Commenting on the company's legal action, Ryanair chief financial officer Howard Millar described the levy as a "rip-off overcharge".
"We can no longer allow BAA to continue to charge £5m per annum in fuel levies," he said.
"Arising from this legal action filed today, we anticipate a substantial reduction in the fuel levy in the order of £4m per annum."
However, Mr Millar said the company's existing airport charges agreement, which ends in 2007, would not be affected by the legal action.
Separately, Ryanair announced it planned to invest £130m in its services at Luton airport. It said it would be introducing nine new European routes from the airport.
"Any growth in the London area for the next year or two will probably be ex-Luton. Stansted is essentially full at this
stage," chief executive Michael O'Leary told Reuters.