The Civil Aviation Authority has referred the price control regime at Stansted to the Competition Commission following the Government’s decision to maintain price regulation at the airport.
The CAA had previously recommended price controls at Stansted be dropped and the charges to airlines be left to the market, but transport secretary Ruth Kelly disagreed.
In its submission to the commission, the CAA points out the price cap at Stansted will affect both the service to passengers at that airport and the price, service and investment at competing airports.
CAA group director of economic regulation Harry Bush said: “Regulating Stansted is unusually challenging. It needs to take account of uncertainty around forecasting, the scale of proposed investment and the sharply differing views of the airport and principal airline customers.”
Ryanair has been especially critical of plans to construct a new terminal and second runway at Stansted and the CAA has asked airport operator BAA to justify the commercial case for expansion.
The Competition Commission will not report until October, with the CAA due to publish proposed charges in December. These will not be introduced next April, following a consultation with airlines and BAA.