UK CAA orders London Gatwick to change pricing system

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Published: August 5, 2011

UK Civil Aviation Authority last month instructed Gatwick Airport Ltd. to implement a more transparent and non-discriminatory pricing structure for check-in and baggage processing by April 2012 and consult its users when revising the pricing system.

The ruling follows a complaint lodged to CAA by Ryanair in 2009 against what the LCC called London Gatwick’s “opaque pricing system” and, more specifically, the lack of information on how it determines charges for check-in desks and associated baggage facilities. The airline disputed the principle that passengers who check-in online and mostly carry hand baggage were being charged the same as passengers who make full use of the airport check-in and associated baggage facilities.

CAA upheld Ryanair’s arguments that the way LGW set the charges for check-in and baggage facilities breached EU regulations on access to ground handling at airports and the UK’s Transparency Condition. Under the EU regulations, the managing body of an airport is required to take the necessary measures to ensure that any fee charged for access to airport installations is determined according to relevant, objective, transparent and non-discriminatory criteria. The criteria that LGW adopted “were not transparent in that users were unable to gain an understanding of how precisely their charges had been calculated,” CAA stated.

CAA also concluded that LGW “did not use objective criteria when it set the Internet check-in charge. Over time, Ryanair increased its share of passengers carrying no hold baggage but [LGW] did not review its relative check-in charges. This had a discriminatory effect because similar terms were established for dissimilar transactions without a sufficient objective justification, in this case passengers carrying no hold baggage generating the same fee for check-in as passengers with hold baggage.”

The LCC reasoned, “Ryanair passengers have therefore been subsidizing the check-in costs of airlines that do require passengers to use these inefficient, expensive facilities.” It noted that CAA’s findings have “far-reaching implications. Ryanair is determined to enforce the principle of non-discrimination, affirmed by the UK CAA, and will now undertake a review of charging structures at monopoly airports throughout Europe to ensure that Ryanair passengers are not forced to pay for services or facilities they do not use.”

CAA, however, rejected claims that the bundling of check-in and baggage-related charges by the airport operator was, by itself, evidence of discriminatory conduct.

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