Manchester Airport could face regulation after rapid growth

By Elizabeth Howcroft

LONDON (Reuters) - Britain's Manchester Airport could be regulated to ensure it does not overcharge airlines on fees after its passenger numbers jumped by a third over a decade, giving it more market power.

The UK's Civil Aviation Authority (CAA) said in statement on Tuesday that it would start a consultation to determine whether Britain's third-busiest airport has so-called substantial market power after its passenger numbers jumped by 33% in 10 years to reach more than 28 million in 2018.

Manchester Airport Group, owned by local government and Australia's IFM Investors, serves airlines including American Airlines, Emirates, Etihad and Ryanair flying to over 200 destinations.

The CAA said it had received a request for an assessment from an unnamed "interested party". It is obliged to assess any UK airport with more than 5 million passengers annually once it receives such a request.

The airport, third behind London's Heathrow and Gatwick airports, has not been assessed before. If found to have substantial market power, it will require an economic licence from the CAA in order to levy charges on airlines who operate there.

The move is designed to prevent airports from exploiting their market power to hike fees.

The last time the CAA started a market dominance test was in 2011, when it took three years to determine that Heathrow and Gatwick airports required regulation, but that Stansted airport did not. Stansted is owned by the Manchester Airport Group.

The CAA said that its preparations are at an early stage and it will start the test later in the year after gathering information from the airport and other interested parties.

Manchester Airport did not immediately respond to a request for comment.

(Reporting by Elizabeth Howcroft; Editing by Susan Fenton)