Gatwick airport charges to be reviewed

Low cost airline easyJet has won its battle to get a High Court review of the increased landing fees at Gatwick airport which were approved by the Civil Aviation Authority.

easyJet says the High Court has approved its application for a Judicial Review of the regulatory process that allowed airport operator BAA to impose what it describes as “an exorbitant increase” in airport charges at Gatwick airport last Spring.

The ruling is hailed as a “legal breakthrough” as it is the first time that the Civil Aviation Authority has been subject to Judicial Review for a regulatory price decision.

BAA raised landing fees at Gatwick by 21% this year from £5.61 to £6.79 following approval by the CAA. The CAA also granted permission for an increase of 31% + RPI by 2013, which easyJet contends is likely to be around 51% assuming the current level of RPI.

easyJet says the way the CAA has allowed BAA to raise prices at Gatwick is wrong on a number of grounds. The budget airline believes the CAA “gave insufficient weight” to the recommendations of the Competition Commission when statutory powers require that the CAA must state any reasons for not accepting the CC’s recommendations.

easyJet also believes the CAA’s treatment of BAA’s late submission of operating costs was “unlawful”. “The CAA failed to adopt a fair and lawful approach to handling a £267 million (subsequently reduced to £218 million) “eleventh hour” operating expenditure submission from BAA,” easyJet says in a press statement.

Finally, easyJet says the CAA ignored the Competition Commission’s public interest finding that there was no justification for BAA to receive bonus payments for meeting airport service levels.

When it published its report about landing fees in March the CAA said that the higher fees would increase service levels at Gatwick and Heathrow and lead to shorter queues at security, cleaner airport terminals and better information for passengers.

“These higher airport charges are essentially paying for the modernisation of Heathrow and Gatwick, in terms of both facilities and service, for the direct benefit of the passenger,” the CAA said in a statement at the time.

Written by: Nick Purdom