BAA, the airport operator, is so indebted that the Competition Commission will investigate whether the situation has become a threat to passengers and airlines.

A warning about the company’s debt is buried in a commission report on future passenger charges at BAA’s airports, which include Heathrow, Gatwick and Stansted.

The report reveals that the commission considered issuing a public interest finding against BAA, an exceptional move that could have required the company to take action to address debt and protect airport assets from creditors.

However, the commission has decided to defer judgment as it failed to find a suitable solution to the problem.

Instead, it will reconsider the situation as part of a broader inquiry into whether BAA should be allowed to maintain a monopoly of airports around London.

BAA was bought by Ferrovial, the Spanish construction company, last year for £10 billion, as well as about £5 billion of the airport operator’s debt.

Ferrovial is struggling to pay the £820 million-per-year interest costs.

It is attempting to refinance the debt and is also selling assets.

The airlines that use BAA’s airports told the Competition Commission that passenger charges could be diverted to paying interest and not for the day-to-day running of its terminals.

The airlines were also concerned that BAA is less capable of coping with shock events, such as a terrorist attack, and would no longer invest in upgrading its airports.

The commission considered asking BAA to set up independent boards for both Heathrow and Gatwick and ring-fencing assets to prevent creditors claiming them.

“The financial structure and gearing levels of BAA, together with the remedial powers in relation to them, are matters to which we will return in the market inquiry,” the commission said.

The report, published on Wednesday, also proposed an 18 per cent increase in the charges BAA levies on airlines for each passenger carried.

Airport empire

—BAA owns and operates seven UK airports; Heathrow, Gatwick, Stansted, Glasgow, Edinburgh, Aberdeen and Southampton

—Ferrovial, which bought BAA last year, is attempting to refinance £9.3 billion of debt, using airport revenue as collateral

—Ferrovial is also selling its 50 per cent stake in the Airport Property Partnership (APP) for about £1.2 billion

—The APP includes office buildings and a cargo centre at Heathrow

—Ferrovial is considering the sale of the World Duty Free shops for about £500 million

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