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Last Updated: Friday, 30 March 2007, 09:13 GMT 10:13 UK
BAA to face competition inquiry
Heathrow airport
BAA also owns Southampton airport
BAA, the owner of Heathrow, Gatwick and Stansted airports, has been referred to the Competition Commission amid concerns about its market dominance.

The Office of Fair Trading (OFT) said it had decided on the move after most industry bodies it consulted on the issue supported the decision.

The probe could potentially result in BAA having to sell one of its three main airports in the south of England.

BAA has opposed the move saying its ownership structure helps customers.

But Ryanair welcomed the decision, arguing it was "good news for consumers".

'Warranted move'

The inquiry, expected to take up to two years, will focus on BAA's ownership of Heathrow, Gatwick and Stansted and whether it distorts competition to the detriment of passengers.

It will also examine BAA's ownership of both Glasgow and Edinburgh airports.

BAA'S UK AIRPORTS
Heathrow, Gatwick, Stansted, Glasgow, Edinburgh, Aberdeen, Southampton

BAA has a 60% market share of all UK passenger flights, rising to 90% in the south of England.

"Having considered the points made by respondents to the consultation, the majority of whom supported referral, the OFT is of the view that the competition concerns it identified prior to the consultation exercise remain valid and that an investigation by the Competition Commission is now warranted," the watchdog said in a statement.

BAA argues its ownership of three of the UK's largest airports enables it to reduce prices for airlines and their customers, while making it easier to raise investment to upgrade terminals.

But many airlines believe BAA's current structure prevents real competition between airports and that facilities have suffered as a result.

The firm was bought by Spanish construction business Ferrovial last year.




SEE ALSO
BAA not planning to sell airports
08 Feb 07 |  Business
Airport competition probe urged
12 Dec 06 |  Business
BA urges break-up of operator BAA
24 Aug 06 |  Business

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