On 19 October, BAA announced that it is to sell Edinburgh airport as part of the package of remedies imposed on it by the CC following its market investigation into the supply of airport services by BAA in the UK. Following that investigation, the CC concluded that common ownership of Edinburgh and Glasgow airports adversely affects competition between them, and that separate ownership would create the potential for competition on price, service, investment and innovation. The CC's initial decision in March 2009 required BAA to divest Gatwick, Stansted and either Glasgow or Edinburgh airports. BAA challenged that decision, ultimately unsuccessfully, although it did sell Gatwick.
After the appeals process concluded earlier this year, the CC confirmed that there had been no material changes of circumstances in the intervening two years which would alter its March 2009 decision. BAA then announced that it would sell Edinburgh rather than Glasgow. It is expected that Edinburgh airport will be formally offered to the market in early 2012, with the sale to be concluded by summer. BAA has appealed the CC's decision that there had been no change in circumstance in respect of Stansted.
Divestiture is the most invasive remedy available to the CC and it is therefore not surprising that BAA has spent so long appealing the decision. However, the CC concluded strongly in its March 2009 report that behavioural remedies would be insufficient to remedy its competition concerns and that divestiture was the only option. It will therefore be hoping to see its decision justified by the rapid emergence of more vigorous competition and the benefits that this can be expected to bring.
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