CONFIDENTIAL

2.

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Both Delegations recognised that the

successful implementation of the scheme necessitated the tailoring of capacity to genuine demand not only on the through routes but also on sectors from either end of such routes to intermediate points, in order to minimise the diversion of traffic from the through routes. It would be desirable for this to coincide with the introduction of the new fare structure but it was recognised that it might not be possible to achieve this in all cases.

It was agreed that in most cases the overall effects on third countries would not be disadvantageous. In order to minimise possible adverse reactions, the countries concerned should be given a full appreciation of the proposals as soon as possible.

The Australian Delegation indicated that it would, as soon as practicable, put to Ministers proposals with a view to obtaining their approval for approaches to third countries and undertook to inform the UK of their decision.

It was agreed that there should be continuing close consultation and co-operation between the two Governments in relation to the proposals, including the exchange of information on approaches to third countries and their reactions.

A list of the two Delegations is attached.

G.T. ROGERS

Leader, U.K. Delegation

६.

J.H. ROWLAND

Leader, Australian Delegation

Ajust

CANBERRA : 5 August 1978

CONFIDENTIAL

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