Competition Commission report on BAA London airports

competition report

REPORT BY THE COMPETITION COMMISSION - NOVEMBER 2002

BAA plc: a report on the economic regulation of the London airports companies (Heathrow Airport Ltd, Gatwick Airport Ltd and Stansted Airport Ltd)

Hard copies of the Report are available from The Stationery Office

Part I   Summary and Conclusions

Chapter 1 Summary

Chapter 2 Conclusions

Part II   Background and evidence

Chapter 3 Background

Chapter 4 Financial performance and cost of capital

Chapter 5 Airport charges and their regulation

Chapter 6 Quality of service

Chapter 7 Operating costs and efficiency

Chapter 8 Commercial and other activities

Chapter 9 Capital investment

Chapter 10 Financial projections

Chapter 11 Views of the CAA and the Department for Transport

Chapter 12 Views of airlines and airline representative bodies

Chapter 13 Views of third parties

Chapter 14 Views of BAA

Appendices

(The numbering of the appendices indicates the chapters to which they relate.)

1.1 The references

2.1 Summary of main issues

2.2 The effects of increases in airport charges at congested airports on airline fares

2.3 Competition Commission statement on its current thinking on the single/dual till

2.4 Guidelines for the individual elements of the quality-based rebate scheme

2.5 Classification of activities

2.6 Heathrow Licensed Taxis Limited

3.1 Extracts from ICAO documents and from the 'Exchange of Notes' on Bermuda 2

4.1 BAA: financial performance-profit and loss statements

4.2 BAA: financial performance-balance sheets

4.3 LAL: financial performance

4.4 HAL: financial performance

4.5 GAL: financial performance

4.6 STAL: financial performance

4.7 HAL: financial performance (regulatory accounting basis)

4.8 GAL: financial performance (regulatory accounting basis)

4.9 STAL: financial performance (regulatory accounting basis)

4.10 Broad principles of cost allocation in accordance with the conditions imposed by the CAA under section 41(1)(a) and (2) of the Airports Act

5.1 The CAA's proposed price path commitment

6.1 Details of the CAA's Q-term proposals

6.2 Extracts from BAA's paper on service quality regulation

6.3 Views of BA and BAA on measuring and assigning causes to delays

6.4 BA's alternative quality-incentive proposals

6.5 Examples of service level agreements

6.6 QSM methodology and detailed scores

6.7 BAA's summary of its 'planning objectives' approach

6.8 Detailed analysis of IATA survey data

7.1 Staff numbers and pay costs

7.2 Typical manpower planning process - Stansted

7.3 Roster management system

7.4 Employment matters

7.5 Pension costs

7.6 Absence and labour turnover

7.7 Analysis of BAA's productivity targets

8.1 Extracts from Donaldsons' report

8.2 Further information on profits from retail and car park

8.3 WDFE: estimated return on capital

8.4 Price trends of BAA car parks

9.1 BAA's project planning, project development processes

9.2 BAA's major projects

9.3 BAA major projects by airport

10.1 Passenger projections

10.2 Regulated Capital Value (RCV) at the start of Q4

10.3 Depreciation and the RCV

12.1 Definition of Terminal 5 opening

Glossary

Index