ON Tuesday the European Commission cleared the bid for the British Airports Authority (BAA) by the Spanish group Ferrovial to go ahead. On Thursday the UK's Office of Fair Trading (OFT) announced that it was considering an investigation into whether BAA's monopoly over UK airports is in the consumers' interests. Ferrovial would have to possess saint-like qualities not to suspect some connection between the two events. Ferrovial's strong interest in BAA has understandably led to anxieties that a national asset might fall into foreign, albeit European, hands, so conspiracy theorists have been quick to see the unexpected action as a way of blocking any such takeover in the near future. OFT's reply is that it has been considering an inquiry for some time and thought it better to make this known as soon as possible, given the possibility of a bid for BAA. There is certainly a case for an inquiry into BAA's hold on the London area with Gatwick, Heathrow and Stanstead, and the unlikelihood of any new airport being built; the low-cost airlines would welcome an inquiry because they think BAA insists on charging for facilities they do not want. On the other hand, BAA is engaged in a huge investment programme which would be difficult to complete on schedule if an inquiry were to take place. Meanwhile Ferrovial is presumably left wondering what sort of a business it would be getting if it bought BAA before any inquiry was completed.
SHOCK FOR FERROVIAL
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