Britain’s Competition Commission said today that it may force BAA to sell three of its UK airports, including two of its sites in London.

The commission said in a report that it may require BAA, owned by Spain’s Grupo Ferrovial, to sell two of its three London airports — Heathrow, Gatwick and Stansted — and either Edinburgh or Glasgow.

At the same time, the commission appeared to cast doubt on the Government's aviation policy and the building of a third runway at Heathrow by recommending that the 2003 Air Transport White Paper, which supported the development of a new runway at London's major airport, should be reviewed.

BAA said that it would ask Ruth Kelly, the Secretary of State for Transport, for clarification on the implication of the commission's comments on the 2003 White Paper in the next few days.

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In a provisional ruling that was tougher than expected on the airport operator, the regulator said that it had found competition problems at each of BAA’s seven airports, which also include Southampton and Aberdeen, with adverse consequences for passengers and airlines.

“A principal cause is their common ownership by BAA,” the commission said today: “There are also competition problems arising from the planning system, aspects of government policy and the system of regulation.”

In a damning statement, Christopher Clarke, chairman of the BAA Airports inquiry group, said the lack of competition at BAA's seven airports was "evident from a large number of factors, including its lack of responsiveness to the needs of its airline customers and a lack of initiative in planning capacity".

He added: "This has resulted in investment that is not tailored to the requirements of airport users and lower levels and quality of service for both airlines and passengers."

The commission conceded that BAA is likely to want to hold on to Heathrow but the cost of doing so would be the sale of Gatwick and Stansted.

Mr Clarke also said that the Competition Commission had found problems with the planning system, aspects of government policy and the system of regulation.

BAA said it had "no intention" of selling Heathrow and pointed out that the commission's report found that the lack of runway capacity was "a main reason for what it calls the current poor standards of service and the lack of resilience at times of disruption, which results in regular delays."

“By calling not just for a fundamental restructure of BAA but also for a review of the Government’s Air Transport White Paper, the commission risks delaying that delivery of new runways and making better customer service less, not more, likely," Colin Matthews, BAA's chief executive, said.

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