The CAA has ruled that East Midlands International Airport Ltd and Prestige Parking Ltd broke competition law by agreeing to fix prices of car parking services at the airport.
An investigation by the aviation regulator found that the two organisations agreed that Prestige should not sell its car parking services at the airport at below a minimum price, which was linked to the price of East Midlands’ own car parking services.
East Midlands imposed the requirement as a condition of allowing Prestige to access facilities at the airport between (at the latest) October 2007 and September 2012.
The CAA has also found that the companies exchanged information about their prices and that East Midlands actively monitored Prestige’s prices.
Competition law does not allow independent businesses to make such arrangements.
East Midlands and its owner Manchester Airports Group (MAG) would have had to pay a fine of almost £12.5 million as a result of this decision but the company proactively disclosed details of the agreement under the Competition and Market Authority’s (CMA) leniency programme before the CAA investigation began.
As the airport also confessed to participation in the illegal agreement and co-operated throughout the investigation, the fine was waived.
MAG has agreed to set up a programme to ensure ongoing compliance with competition law “within its business and among staff”.
It has also agreed to review existing concession contracts that East Midlands has entered into, to ensure that they do not break the law on anti-competitive agreements.
Prestige, which was a much smaller airport car parking provider than East Midlands, also confessed to having broken competition law and co-operated fully with the CAA’s investigation.
The company is no longer trading and therefore the CAA will not impose a fine on it.
Richard Moriarty, director of markets and consumers at the CAA, said: “Competition at airports is crucial to ensure that consumers benefit from choice and value for the whole passenger journey, including for services such as car parking at the airport.
“The fact that an airport operator owns land at the airport on which an independent business operates, does not mean that the airport can dictate the price of services sold by that independent business.
“This is the CAA’s first competition investigation and we found that both parties independently identified that their agreement might harm competition but failed to act on it.
“It is vital that airports and providers of services at airports understand and comply with competition law.
“This case should serve as a clear sign that we are prepared to take action to protect consumers wherever necessary and companies should be well aware that they could face a significant fine if they break competition law.”
In addition to this investigation, the CAA has also conducted a wider sector review of road-based access to large UK airports – including car parking services.
