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DRAFT
TE ON THE MACHINERY FOR ESTABLISHING AIR TARIFFS AND CAA RESPONSIBILITIES
IN THE MATTER
1. The Civil Aviation Authority is the UK body responsible for the approval of air tariffs (i.e. passenger fares and cargo rates) and is concerned with
the tariffs of the following kinds:-
(a)
international tariffs (i.e. those between the UK and foreign
countries or between British overseas territories and foriegn
countries);
(6)
cabotage tariffs (i.e. those between the UK and British overseas
Overseas territories territories or between two or more British); and
(c)
domestic tariffs (i.e. those within the UK, Channel Islands,
and Isle of Man).
Category (c) is mentioned for completeness but it does not fall within the scope
of this paper.
2.
In discharging these duties, the Authority must have regard to the provisions
of the Civil Aviation Act 1971, the procedures set out in the Civil Aviation
Authority Regulations 1972, the Policy Guidance of February 1976 (Cmnd 6400),
and, in the case of international tariffs, the UK's obligations under international
treaties in the form of a series of bilateral Air Service Agreements. The Policy
Guidance exhorts the Authority, subject to international constraints, to seek
to secure tariffs which are rational, simple and enforceable; it adds that as
a guiding principle for the longer term each charge should be related to costs
at a level which will yield sufficient revenue to cover the costs of efficient
operators, including an adequate return on capital. Against that background,
the procedures followed for negotiating, considering and approving tariff proposals
are outlined below.
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