Competition Commission
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CC approves Edinburgh Airport sale

The Competition Commission (CC) has approved BAA’s sale of Edinburgh Airport to Global Infrastructure Partners (GIP).

The sale was announced yesterday. This approval follows an extensive process in which the CC has reviewed potential buyers to ensure that they meet its criteria on appropriate expertise, financial resources, independence from BAA and absence of further competition concerns.

GIP bought Gatwick Airport from BAA in December 2009, following the CC’s report into BAA’s ownership of seven UK airports, which required BAA to sell three airports (PDF, 56 Kb) . Following a number of legal challenges and a CC reassessment of the original decision, the CC brought forward in October 2011 (PDF, 39 Kb)  the requirement for BAA to sell either Edinburgh or Glasgow Airport whilst BAA continued to challenge the sale of Stansted Airport. The Competition Appeal Tribunal (CAT) upheld the Stansted decision in February 2012 and BAA is now appealing to the Court of Appeal.

The CC will also now consult on draft undertakings provided by GIP, which prevent the change of ownership of Edinburgh Airport within five years unless the CC is satisfied that any new purchaser satisfies the CC’s criteria.

Laura Carstensen, Chairman of the BAA Remedies Implementation Group and a member of the original Inquiry Group, said:

'We’re pleased to approve the sale of Edinburgh Airport to GIP—and to enable the swift conclusion of this divestiture process. GIP’s track record is very strong and we anticipate that customers at Edinburgh Airport will soon see the benefits of new management approaches—and that Scottish passengers and airlines more generally will also gain from the introduction of a more competitive environment.

'We hope to be in a position to proceed with the sale of Stansted before too long'.

The draft undertakings are available here.

Notes for editors

1. On 29 March 2007, the Office of Fair Trading made a reference to the CC under section 131 of the Enterprise Act concerning the supply of airport services by BAA in the UK. The CC published its report entitled BAA airports market investigation on 19 March 2009 (the report). BAA appealed aspects of the CC’s decision to the CAT, and on 21 December 2009 the CAT found that BAA’s application for review of the report succeeded on one ground (namely, apparent bias), but failed on a second ground (namely, that the CC failed properly to apply the proportionality principles when fixing the timetable for divestiture of three BAA airports).

2. The CC appealed against the CAT’s decision on apparent bias. On 13 October 2010 the Court of Appeal upheld the CC’s Appeal against the decision of the CAT, restoring in full the report together with its remedies. On 18 February 2011, the Supreme Court refused BAA permission to appeal further.

3. In July 2011, the CC concluded a consideration of whether there had been any material changes in circumstances since it published its final report on BAA in March 2009 that should give it cause to reconsider the implementation of the airport sales required by that original decision. The CC concluded that the sale of the airports was fully justified and that passengers and airlines would 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.

4. The BAA Remedies Implementation Group consists of: Laura Carstensen (Chairman of the Group), Jayne Almond, Jill Hill and John Smith. Former CC Chairman, Peter Freeman, stepped down as Chairman of the Group earlier this year when his term as a CC member ended. Dr Peter Davis also stepped down from the Group after resigning his post as CC Deputy Chairman.

5. Media enquiries should be directed to Rory Taylor or Siobhan Allen or by ringing 020 7271 0242.

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