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Heathrow said it might appeal the cap, which was much lower than expected for the next five years, but airlines said the move did not go far enough as the hub still had some of the most expensive charges in the world.
Britain's Civil Aviation Authority (CAA) said on Friday it would insist that Heathrow set its prices at 1.5 percent below inflation from April 2014 after finding that the airport - Europe's busiest - had too much market power.
We want to continue to improve Heathrow for passengers," chief executive Colin Matthews said. "We will review our investment plan to see whether it is still financeable in light of the CAA's settlement."
The airport, which has expanded in recent years with Terminal 5 and the redevelopment of Terminal 2, said the new price limit would result in a fall in the cost charged per passenger from GBP£20.71 (USD$33.99) in 2013/14 to GBP£19.10 (USD$31.35) in 2018/19 in real terms.
It said this would result in a rate of return on capital investment of an "unsustainable" level of 5.35 percent compared with the 6.7 percent it was seeking.
But Heathrow questioned the CAA's forecasts for the next five years in terms of passenger numbers and costs, and said it would have to cut operational expenditure by more than GBP£600 million and increase commercial revenue targets by more than GBP£100 million by increasing retail and car park charges.
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