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CC publishes airports price control issues statement

COMPETITION COMMISSION News Release (42/07) issued by The Government News Network on 13 July 2007

The Competition Commission (CC) has published an issues statement as part of its statutory review of the CAA's proposed price controls for Heathrow and Gatwick airports, which will govern how much the airports' owner, BAA, can charge airlines during the five-year period beginning April 2008 .

The CC is carrying out a review of these price controls as well as examining whether the airport owner has pursued any conduct during the last five years which has operated against the public interest. The CC's review must report back to the CAA by September 29 2007, which will then consider the CC's recommendations before carrying out a final round of consultation and announcing a final decision in March 2008.

The issues statement follows the initial process of gathering information, views and evidence and summarises the main issues to be considered in the remaining stages of the inquiry, in order to give any interested parties the opportunity to provide any further comments, not only on this document but also on any of the material on the CC's website. A number of submissions have already been published at:

http://www.competition-commission.org.uk/inquiries/ref2007/heathrow/index.htm

The full issues statement is available at http://www.competition-commission.org.uk and looks at questions relating to the structure of the price control; those relevant to the maximum level of charges as determined by the charging formulae such as capital expenditure, regulatory asset base, cost of capital, depreciation, operating expenditure, other revenue and traffic forecasts; and public interest issues.

The issues statement should not be seen as implying that the CC has reached any conclusions on the issues in this inquiry. The purpose of making the statement of issues public is to inform all interested parties and give them an opportunity to raise any further points with the CC.
The CC is also carrying a market inquiry into the supply of airport services by BAA and will issue an issues statement on that inquiry in the next few weeks.

Anyone wishing to comment on the issues statement should do so by emailing airports@cc.gsi.gov.uk or by writing to the Inquiry Secretary (Heathrow/Gatwick price review), Competition Commission, Victoria House, Southampton Row, London WC1B 4AD.

Notes for editors

1. The CC is an independent public body, which carries out investigations into mergers, markets, and the regulated industries.

2. The members of the inquiry group are: Christopher Clarke (Group Chairman and CC Deputy Chairman), Laura Carstensen, Dr John Collings, Professor Jonathan Haskel, Richard Holroyd, Professor Peter Moizer and Professor Sudi Sudarsanam.

3. Further information on the CC and its procedures, including its policy on the provision of information and the disclosure of evidence, can be obtained from its website at: http://www.competition-commission.org.uk.