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The Competition Commission has ordered BAA to sell its airports at Gatwick, Stansted and either Edinburgh or Glasgow.

The three airports must be sold in order within the next two years, beginning with Gatwick.

The Competition Commission's report came after a two-year investigation into BAA's dominance over airports in Scotland and the south-east England.

Responding to the findings, the airport operator said the commission's analysis was "flawed" and said "its remedies may be impractical in current economic conditions".

The commission maintains the lack of competition between airports owned by BAA is detrimental to passengers and has ordered three of the terminals to be sold off.

The sale of Gatwick, which dealt with over 34 million passengers last year, has already begun.

Christopher Clarke, who chaired the inquiry, said the break-up of airports was the "only way to address comprehensively the detriment to passengers and airlines from the complete absence of competition" in Scotland and south-east England.

A number of airlines have welcomed the move, with Virgin Atlantic communications director Paul Charles commenting: "The break-up of BAA is something Virgin Atlantic has requested for many years and it will undoubtedly benefit consumers.

"Better airport facilities in the UK and lower prices will be the result and we therefore congratulate the Competition Commission on its findings."

BAA was bought by Spanish firm Ferrovial in 2006 and has seen profits hit by the economic downturn.

In February, the airport operator blamed a drop in passenger numbers for the decline in 2008 profits, which fell by 18.4 per cent compared to the previous year.