Call for BAA Monopoly Probe in Stansted Row; CITY BRIEFING

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Byline: ROBERT LEA

TRANSPORT Secretary Alistair Darling has been urged to launch an immediate investigation into BAA's London airports monopoly in the escalating row over the group's plan to subsidise a [pounds sterling]4 billion expansion at Stansted airport with revenue from passengers at Heathrow and Gatwick.

It has also emerged that the Civil Aviation Authority, which sets airline landing fees in London, will invite BAA to submit plans to move the regulatory goalposts and scrap the ban on it cross-subsidising its airports.

BAA chief executive Mike Clasper this week revealed that the construction of a second runway at Stansted, and additional infrastructure to support it, would be delayed for "several years" from its planned 2012 deadline unless it is able to bring in funding from elsewhere in the group and double landing charges at the Essex airport.

Airlines that use Stansted, such as Ryanair and easyJet, are up in arms at the prospect of raised charges, and nonusers, such as Virgin Atlantic, are angry that they will effectively pay for the airport through what amounts to a levy at Heathrow and Gatwick.

TBI, owner of London's fourth airport, Luton, has waded into the row, accusing BAA of a flagrant abuse of its monopoly position.

Chief executive Keith Brooks said: "The proposals are outrageous.

They contravene the existing Civil Aviation Authority regulations on cross-subsidy of London airports and, if allowed to go ahead, would represent the further exploitation of BAA's monopoly position."

Brooks is seeking urgent meetings with Darling and the CAA over what he sees as BAA's use of its financial clout to expand an empire granted to it at privatisation.

The CAA said today that BAA's Stansted proposals would form part of negotiations for the next landing fees price review. Talks start later this year and cover the five years up to 2013.

The row is putting Darling in a difficult position. Any delay in a second runway at Stansted would scramble his plans set out in the aviation White Paper last year, which envisaged a major expansion of London airport capacity over 30 years to cope with soaring passenger numbers. …