BAA must sell off either Edinburgh or Glasgow airport

AIRPORT operator BAA must sell either Edinburgh or Glasgow airport, the Competition Commission (CC) said today in a final ruling.

• In Scotland BAA owns Edinburgh, Glasgow and Aberdeen airports

BAA, which runs six UK airports including Heathrow, will also be forced to sell Stansted Airport.

The sale process will start in three months "or sooner if undertakings are accepted from BAA in the meantime", the CC said.

Today's announcement follows a provisional ruling on the sales made in March this year and ends a two-year saga which began in March 2009 when the CC made what was seen then as a final report on BAA's airport ownership.

In that March 2009 ruling, the commission said BAA must sell Gatwick - since disposed of - as well as Stansted and either Edinburgh or Glasgow.

But there were then a series of legal challenges by BAA to the ruling, which ended with the CC findings being upheld.

The CC then considered whether there had been material changes in circumstances since the 2009 ruling.

Both in the provisional ruling in March this year and in today's final report, the CC said the sale of the airports was fully justified.

It added that passengers and airlines would still benefit from greater competition with the airports under separate ownership, despite the current Government's decision to rule out new runways at any of the London airports.

While the legal battle was going on, BAA sold Gatwick - with the West Sussex airport being bought by US-based investment fund Global Infrastructure Partners for around 1.5 billion in late 2009.

Peter Freeman, the CC's chairman of the BAA remedies implementation group, said today: "We hope that the sales can now proceed without delay so that passengers and airlines can start to enjoy the benefits of greater competition.

"Our report has been challenged, reviewed and upheld and it is clear that the original decision to require BAA to divest three airports (including Gatwick) remains the right one for customers."

"There has also been no cause to alter our view on the need for either Edinburgh or Glasgow to be under separate ownership."

The CC said Stansted should be sold first as it served the larger number of passengers and there would be a small overlap between the Stansted sale and that of one of the Scottish airports.

This final ruling from the commission may not be the end of the matter, as BAA immediately responded today by saying that it was considering a judicial review.

BAA chief executive Colin Matthews said: "We are dismayed that the CC's final decision still requires us to sell Stansted and either Glasgow or Edinburgh airport. The CC has not recognised that the world and BAA have changed.

"This decision would damage our company which is investing strongly in UK jobs and growth. We have a responsibility to protect our shareholders' investment and we will now consider a judicial review of the CC's decision."