This consultation considers the views of stakeholders following an industry consultation last summer (CAP2554), develops a framework for assessing whether GAL’s proposals to extend the commitments are in the interests of consumers and sets out our initial assessment using this framework.
Gatwick Airport Limited operates under a set of ‘commitments’, a legally binding contractual undertaking between GAL and its airline customers. The current set of commitments were introduced on 1 April 2021 and run until 31 March 2025. This commitments framework is underpinned by an economic licence granted by the UK Civil Aviation Authority under the Civil Aviation Act 2012.
GAL has proposed an extension of these commitments from 1 April 2025 until 31 March 2029. GAL’s proposal includes:
a revised price cap for the extension period – two years of Consumer Prices Index (CPI) -1% followed by two years of CPI + 0%;a process to review the current service quality targets and rebates;a continuation of the current commitment which requires GAL to invest a minimum of £120 million (in 2018/19 prices) per year, on average, over a ten-year period (from 2019/20 to 2028/29).
The UK Civil Aviation Authority is now seeking views from the industry on this framework and its initial assessment, which will inform the way forward for the economic regulation of GAL.
The consultation period will be open until 20th September and more details can be found on the CAA's website. caa.co.uk
