The UK Civil Aviation Authority will undergo major reform so in future it is focussed on "furthering passengers' interests" under proposals laid out in a draft government bill.
Transport minister Justine Greening said in a statement that the changes, which could come before Parliament early next year, represented "an important step in this Government's desire to put passengers at the heart of airport operations".
The CAA's current four main duties will be replaced by a single primary duty and a number of other further responsibilities. This will be to "promote the interests of existing and future consumers of passenger and freight services at UK airports, wherever appropriate by promoting effective competition".
It devolves more powers to the CAA, including the transfer of responsibility for deciding which airports should be subject to economic regulation.
The bill will also replace what it describes as the "current 'one size fits all' approach" to economic regulation of the airports. Licence conditions can be tailored to the specific circumstances facing individual airports, it said.
Enforcement powers will be bolstered, allowing the regulator to charge up to 10% of an airport's turnover to tackle poor performance. A "fast track" process to speed up compliance will also be in place.
A new system of appeals will be introduced and the CAA will also be granted powers to investigate anti-competitive behaviour, similar to those held by the regulators of the utilities industry.
Greening added: "In addition the Bill gives the CAA a role in promoting better public information about airline and airport performance and about the environmental effects of aviation and measures taken to mitigate adverse effects."
The new regime will initially apply to Heathrow, Gatwick and Stansted airports - the three airports already have their charges capped by the CAA.
EasyJet chief executive Carolyn McCall said: "EasyJet strongly supports these reforms, which puts the passenger at the heart of aviation policy and recognises the key role airlines can play to deliver this outcome.
"We are particularly pleased that, following EasyJet and other airlines' lobbying a right of appeal has been given to airlines in the process of setting charges at regulated airports. This recognises how our interests are aligned with our passengers, and that we represent their views well."
Virgin Atlantic added: "Reform is long overdue - the current regulatory regime has failed passengers. Airport charges have been allowed to increase way above the rate of inflation, hitting passengers' pockets and completely ignoring the economic climate. Last winter's snow showed that the performance of airports had not improved at the same rate."
The bill will also effectively create a single regulator for aviation safety and security, however policy functions remain with the Secretary of State for Transport.
UK airports operator BAA could not immediately be reached for comment.