Heathrow Airport could lose up to four million passengers when a scheme requiring people visiting the UK without a visa to pay £10 is expanded, it was claimed today.
The electronic travel authorisation (ETA) system will be widened to include travellers from most countries from November, and then European nationals by next spring.
But the scheme has faced a backlash from business groups and airports because it includes passengers on connecting flights - a major part of Heathrows revenue.
The Conservative government introduced the ETA system in November last year for people entering or transiting through the UK without legal residence rights or a visa.
ETAs, which cost £10 and can be bought online, are currently required for nationals of Qatar, Bahrain, Kuwait, Oman, the United Arab Emirates, Saudi Arabia and Jordan.
But on Tuesday the Home Office said the scheme will open up in November for all other nationals, except Europeans, and be required for entry from January 8, 2025.
Home Secretary Yvette Cooper confirmed the ETAs will be extended to European nationals in March 2025, and be a travel requirement for them from April 2, 2025.
British Airways is among the airlines set to be affected at Heathrow by the ETA expansion
ETAs, which are digitally linked to a travellers passport, permit multiple journeys to the UK for stays of up to six months at a time over two years - or until the holders passport expires if that is sooner.
But analysis by The Independents travel expert Simon Calder has indicated that the scheme could have a serious financial impact of up to £5billion on Heathrow, its retailers and UK airlines.
In July, Heathrow blamed the ETA scheme for a 90,000 drop in transfer passenger numbers on routes included in the system since it was launched as people switched to other airports.
The London hub described the programme as devastating for our hub competitiveness and urged the Government to review the inclusion of airside transit passengers.
Now, Mr Calder has extrapolated Heathrows figures should passengers from other countries follow the same pattern when the ETA scheme widens.
He said: At present almost all transit passengers at Heathrow - comprising 30 per cent of the total - need only to be documented for their destination.
But initial figures for Gulf nationals suggest one in six prospective transit passengers has switched from Heathrow to a different hub because of the ETA demand.
From April 2025, though, almost all airside transit travellers will need ETAs. If the same proportion is deterred, Heathrows passenger figures could fall by four million.
Mr Calder said British Airways would likely face the biggest financial hit - with Virgin Atlantic, Lufthansa, United, Air Canada and Singapore Airlines also set to be affected.
He estimated a financial hit between £2.5billion and £5billion each year, when considering lost revenue to airlines and spending at airport retailers.
Heathrow has not yet commented on Mr Calders projections, but a spokesman for the airport said: We dont disagree with the long-term roll-out of the scheme, but including airside transit passengers will make the UK less competitive and harm economic growth.
We want to work in partnership with Home Office Ministers over the next few months to address this issue, and learn from the lessons of the countries trialled, where weve seen the loss of a significant number of transfer passengers already.
Home Secretary Yvette Cooper has revealed the expansion of ETAs over the coming months
AirportsUK, an industry group representing Britains airports, said passengers from those countries already in the ETA scheme were instead choosing to fly through other European airports such as Paris, Frankfurt and Amsterdam.
Business groups in London have also raised concerns about the impact on the capitals economy.
Polyvios Polyviou, programme director for transport at BusinessLDN, told City AM: At a moment when we should be levelling the playing field on traveller costs to ensure the UK aviation industry remains world class, these new rules will make London harder to reach.
Forcing passengers to apply for ETAs even when they are just stopping over in the UK will be especially damaging to Heathrow – our only hub airport, and a vital driver of business activity across London and beyond.
Announcing the ETA expansion plan on Tuesday, Ms Cooper said in a written statement laid before the House of Commons: Once fully rolled out, the ETA scheme will close the current gap in advance permissions and mean that for the first time, we will have a comprehensive understanding of those travelling to the UK.
The ETA system will be widened to include travellers from most countries from November
The Home Office said ETAs ensure more robust security checks are carried out before people begin their journey to the UK, which helps prevent abuse of our immigration system.
Airlines allowing a passenger to fly to the UK without an ETA will be fined up to £2,000.
The ETA expansion will apply to all UK airports with airside transit, but very few passengers changing at hubs other than Heathrow are on connecting international flights – and therefore the impact of the scheme will only be minimal elsewhere.
Also this week, Ms Cooper announced the introduction of a visa requirement for all visitors from Jordan from 3pm on Tuesday due to breaches of visitor rules.
Jordanian nationals are no longer be able to travel to the UK with an ETA.
A four-week transition period will be in place for travellers who already hold an ETA and have confirmed travel bookings.
Virgin Atlantics operations at Heathrow are also likely to be impacted by the ETA expansion
Ms Cooper wrote: We are taking this action due to an increase in the number of Jordanian nationals travelling to the UK for purposes other than what is permitted under visitor rules since the visa requirement was lifted in February 2024.
This has included a significant and sustained increase in asylum claims, and high rates of refusals at the border due to people travelling without the intention of visiting for a permitted purpose.
This has added significantly to operational pressures at the border, Ms Cooper wrote.
She added that the decision to introduce a visa requirement was taken solely for migration and border security reasons, and the UKs relationship with Jordan remains a strong and friendly one.
Minister for Migration and Citizenship Seema Malhotra said: Digitisation enables a smooth experience for the millions of people who pass through the border every year, including the visitors we warmly welcome to the UK who are predicted to contribute over £32billion to our tourism economy this year.
The Conservative government introduced the ETA system in November last year
The worldwide expansion of the ETA demonstrates our commitment to enhance security through new technology and embedding a modern immigration system.
Meanwhile, it has been confirmed that the ETA expansion will not mean checks for tourist crossing the border in Ireland.
The UK Government has promised to ensure the scheme will not act as a barrier to tourism in Ireland where any physical border was wiped away as part of the Good Friday Agreement in 1998.
But the expansion is being viewed as a blow to both the Irish government and the Irish tourism industry.
Tourism Ireland warned the scheme will add an unnecessary layer of bureaucracy and complexity for foreign tourists hoping to cross the border to visit the Giants Causeway or the Titanic exhibition in Northern Ireland.
Irish and British citizens, alongside people legally resident in Ireland, will be exempt from the ETA – and it will also not affect tourists crossing the border or those in the north heading south.