UK Civil Aviation Authority publishes final proposals for economic regulation of Heathrow & Gatwick

UK Civil Aviation Authority (CAA) published (03-Oct-2013) for consultation its final proposals for the economic regulation of Heathrow and Gatwick airports to protect passengers after Apr-2014. The UK CAA said the "proposals are tailored so each airport remains globally competitive and can deliver the customer experience that passengers expect of airports in the 21st century. They challenge airports to operate more efficiently, and to work more closely with airlines to develop competitive offerings for travellers". Commenting on the final proposals, Dame Deirdre Hutton, CAA Chair, said: "Our proposals demonstrate how we can regulate airports more flexibly where this seems best for passengers, but also setting a tough efficiency challenge. We expect the airports to work closely with airlines to provide high-quality services to passengers". The proposals are made using powers set out in the Civil Aviation Act 2012, which allows more flexibility than in the past, so the CAA's current regulatory proposals reflect the unique circumstances of each airport. The CAA is required to assess the level of market dominance at airports it proposes to regulate, explaining clearly why regulation will achieve better outcomes for consumers than the market and then set out its proposals. To qualify for regulation, an airport must have, or be likely to get, substantial market power, and economic regulation must be likely to improve outcomes for passengers. CAA will publish its decision on market power for both Gatwick and Heathrow and, where appropriate, its final decision on the necessary form of regulation in Jan-2014. [more - original PR]