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UK Regulator Considers Further Reduction of Heathrow Airport Fees

 |  March 20, 2024

Britain’s Civil Aviation Authority (CAA) has initiated a consultation process that could lead to a further reduction in fees charged by Heathrow Airport, the nation’s largest aviation hub.

The CAA revealed on Wednesday its contemplation of lowering the proposed cap on passenger charges for both 2025 and 2026 by up to 6%, in light of recent findings by competition regulators. This move comes as part of a six-week consultation period launched by the regulatory body.

In a statement, the CAA expressed its intention to finalize the decision regarding modifications to Heathrow Airport Limited’s License by the summer of 2024, with adjustments slated to be implemented evenly over the subsequent two years.

The decision follows the CAA’s announcement last year to reduce the cap on charges at Heathrow Airport for the period spanning 2024 to 2026. This announcement had stirred controversy, drawing criticism from both the airport authority, which argued that the cuts would impede investment, and airlines, who insisted that the airport’s fees remained excessively high.

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The CAA, however, asserts that the proposed reductions are aimed at benefiting consumers and align with recommendations put forth by the Competition and Markets Authority, urging a reevaluation of the airport’s fee structure.

Should these changes be confirmed, they could potentially complicate an ongoing sale process led by Ferrovial, Heathrow’s major shareholder. The proposed alterations to fee structures might influence the valuation and attractiveness of the airport in the eyes of potential investors.

As the consultation period unfolds, stakeholders, including airlines, Heathrow Airport Limited, and consumer advocacy groups, are expected to engage actively, providing insights and perspectives that will shape the final decision regarding Heathrow’s fee regime for the coming years.

Source: UK News Yahoo