The CAA has powers under the Civil Aviation Act 2012 for the economic regulation of operators of airports in the UK. Under the legislation an airport operator that passes the following test requires a licence issued by the CAA.  The test is:

a) The relevant operator has, or is likely to acquire, substantial market power in a market, either alone or taken with such other persons as the CAA considers appropriate.

b) Competition law does not provide sufficent protection against the risk that the relevant operator may engage in conduct that amounts to an abuse of that substantial market power.

c) For users of air transport services, the benefits of regulating the relevant operator by means of a licence are likely to outweigh the adverse effects.

Until 1 April 2014, the operators of Heathrow, Gatwick and Stansted airports are exempted from the need to hold a licence and will continue to be regulated under the Airports Act 1986. The CAA is currently in the process of assessing whether these three airport operators pass the test and, if so, the conditions of their licences.  More information on this assessment is on the airport market power assessment page.  These airport operators are currently subject to price controls.  More details are available on the quinquennial review of designated airports page.

An airport operator whose annual turnover at the airport exceeded £1m in at least two of the last three finanical years may apply for a certificate that confers rights on the operator as a stautory undertaker. Airport operators who already have a permission to levy airport charges issued under section 39 of the Airports Act 1986 retain their status as a statutory undertaker.  A note on the transition between the Airports Act and Civil Aviation Act, including a list of airports that have rights as statutory undertakings is available.

Documents relating to the CAA's powers with respect to the European Directive on airport charges, including a list of the regulated airports, are available on The Airport Charges Regulations 2011.

Documents relating to the CAA's powers with respect to groundhandling are available in the section on Airports (Groundhandling) Regulations 1997.

The CAA's competition powers with respect to airports are on the Competition Powers page.

Documents relating to the CAA's powers under the Airports Act 1986 are available on  The Airports Act 1986. The CAA's economic regulation powers for the non-designated airports in England, Scotland and Wales under part 4 of the Airports Act and for the non-designated airports under the Airports (Northern Ireland) Order 1994 ceased from 6 April 2013.  Its powers under the Airports Act for the designated airports of Heathrow, Gatwick and Stansted will cease from 1 April 2014.