12th December 2006

OFT to refer BAA to Competition Commission

Stop Stansted Expansion (SSE) welcomes the decision today (12 December) from the Office of Fair Trading (OFT) to refer BAA to the Competition Commission for a full investigation into its monopoly position in the UK airport market in the south east of England and in central Scotland.

The initial investigation by the OFT found “evidence of poor quality and high charges” at BAA airports and concluded that “BAA’s investment plans, which are of great importance to the UK, have raised significant concerns among its customers.”

SSE has consistently argued for a break-up of the BAA monopoly, not least because BAA’s future expansion plans for Stansted make no commercial sense other than in the context of a monopoly provider of London’s airport capacity.

SSE submitted a detailed economic and financial response to the OFT several months ago and will now be following this up with a further submission.

Brian Ross, Economics Adviser to SSE commented:  “This is a landmark decision by the OFT and is of course, very welcome.  Importantly, as this monopoly investigation proceeds BAA must not be allowed off the hook simply by selling Gatwick (as widely rumoured).  With the Government supporting new runways at Heathrow and Stansted, BAA would still have far too much long term market power in the south east if it was allowed to retain both of these airports.”

Since the OFT began its initial investigation into BAA in June, SSE has received a considerable amount of evidence from local businesses – particularly in the hotel, B&B and taxi sectors – indicating anti-competitive behaviour and possible abuse of BAA’s market power at Stansted.  In the months ahead SSE will examine these issues further and, if appropriate, provide evidence to the Competition Commission inquiry.

To mark this important decision by the OfT, SSE is today’s re-issuing its 2005 ‘BAA Monopoly’ beer mat – also as a light-hearted bit of fun for Christmas.

Campaigning against proposals to expand Stansted Airport