East Midlands airport broke competition law by agreeing to fix prices of car parking services, the first competition probe instigated by the Civil Aviation Authority has found.

However, the Manchester Airports Group-owned airport escaped a fine of almost £12.5 million after admitting to the illegal agreement and co-operating in the investigation.

The aviation regulator found that the airport and Prestige Parking agreed that the firm should not sell its car parking services at below a minimum price, which was linked to the price of East Midlands’ own car parking services.

The airport imposed the requirement as a condition of allowing Prestige to access facilities at the airport between October 2007 and September 2012.

Without this access, Prestige would not have been able to provide car parking services to its customers on the airport site, according to the regulator.

The CAA also found that the companies exchanged information about their prices and that the airport actively monitored Prestige’s prices.

Prestige is no longer operating but had admitted to breaking competition law.

MAG has agreed to set up a programme to ensure ongoing compliance with competition law within its business and among staff.

It has also agreed to review existing concession contracts that East Midlands airport has entered into, to ensure that they do not break the law on anti-competitive agreements.

In addition to this investigation, the CAA has also conducted a wider sector review of road-based access to large UK airports – including car parking services.

This explores issues relating to competition for provision of services such as car parking.

CAA markets and consumers director Richard Moriarty said: “Competition at airports is crucial to ensure that consumers benefit from choice and value for the whole passenger journey, including for services such as car parking at the airport.

“The fact that an airport operator owns land at the airport on which an independent business operates, does not mean that the airport can dictate the price of services sold by that independent business.

“This is the CAA’s first competition investigation and we found that both parties independently identified that their agreement might harm competition but failed to act on it.

“It is vital that airports and providers of services at airports understand and comply with competition law.

“This case should serve as a clear sign that we are prepared to take action to protect consumers wherever necessary and companies should be well aware that they could face a significant fine if they break competition law.”