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3. AS TO CAPACITY, CPA FAVOUR A CHANGE TO PREDETERMINATION OF CAPACITY SO THAT CP AIR BE FROZEN AT THEIR CURRENT THRICE WEEKLY
SERVICE UNTIL SUCH TIME AS A UK DESIGNATED CARRIER TAKES UP AN
EQUIVALENT AMOUNT OF CAPACITY. FURTHER FREQUENCY THEREAFTER TO BE DEPENDENT UPON ROUTE LOAD FACTORS AND FURTHER GOVERNMENTAL TALKS. SUCH AN ARRANGEMENT WOULD NOT SERVE THE PUBLIC INTEREST AND WE SEE NO GOOD REASON TO ADOPT A DIFFERENT POLICY WITH THE CANADIANS THAN WE DID WITH THE AMERICANS IN THE RENEGOTIATION OF THE UK/US ASA. WE THEREFORE FAVOUR THE FREEZING OF CP AIR'S PRESENT LEVEL OF 5TH FREEDOM CAPACITY (3 WIDE-BODIED SERVICES WEEKLY) BUT THAT 3/4TH FREEDOM CAPACITY SHOULD BE UNFETTERED. THIS COULD BE REVIEWED IN THE LIGHT OF A UK DESIGNATED AIRLINE WISHING TO TAKE
UP RIGHTS BETWEEN HONG KONG AND CANADA.
MACLEHOSE
FILES MAED
HK & GD N.A.D
MR.BURROWS MR.CORTAZZI
MR.MURRAY
MR. HALL
[COPIES SENT TO CAD/DOT]
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