LONDON (ShareCast) - UK airport operator BAA gave a warm welcome to revised proposals from the government over the licensing and running of the UK's airports, which heavily diluted down the original plans.
The Department of Transport
has dropped plans for the introduction of a Special Administration regime. Instead, the Civil Aviation Authority will have a new duty to ensure that airports can finance their licensed activities.
The financial ring-fencing rules are also to be relaxed after the government decided that the costs of introducing certain elements would exceed the benefits. The regulator could switch ring fencing back on if the financial circumstances of an operator were to change under another change being considered.
There will also be a licence condition requiring airport operators to maintain a minimum creditworthiness. A condition requiring airport operators to produce and maintain a Continuity of Service plan is also being considered.
Heathrow and Gatwick operator BAA was delighted with the changes. "We welcome this statement which removes key uncertainties for BAA and its creditors and underlines the need for the regulator to ensure airport operators have the necessary resources to operate and invest in their airports. We are confident that the Department's remaining consultation process will allow BAA to move forward with the important long term investment in Heathrow," it said.
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