30
CONFIDENTIAL
35)
CONFIDENTIAL
FM HONG KONG 010950Z APR 80
TO IMMEDIATE FCC
TELEGRAM NUMBER 476 OF 1 APRIL
HKK18416
RECALL) BAECKERY NO. 51 - 2 APR 1980
INFO IMMEDIATE HONG KONG GOVT OFFICE LONDON DE OFFICER
INDLX
PA
YOUR TELNO 277 AND PARAGRAPH 1(D) OF OUR TEL NO 461. Ju
AIR SERVICES : CAA DECISION.
IN OUR OPINION THERE ARE VALID GROUNDS IN CIVIL AVIATION TERMS
FOR THE CAA DECISION TOBE CHANGED IN CPA'S FAVOUR. OTHER THAN IN
THE SHORT TERM PERHAPS, 7475 WILL BE MORE APPROPRIATE THAN THE DC10S. IN THE SHORT TERM, CPA CAN USE THEIR INTERMEDIATE TRAFFIC RIGHTS TO FILL THEIR 747S, AND BECAUSE OF THE PEAKS AND TROUGHS IN THE NUMBERS OF PASSENGERS DURING THE WEEK, AT WEEKENDS IN PARTICULAR THE 747 WILL EVEN NOW BE MORE APPROPRIATE ANYWAY.
2. THESE AND OTHER CIVIL AVIATION POINTS WE SHALL COVER IN OUR COMMENT ON THE APPEAL (PARA 1(B) OF OUR TELNO 461). WE SUGGEST THAT LORD CARRINGTON'S LETTER TO MR NOTT SHOULD SUPPORT HKG
ON SOME OF THE FOLLOWING POLITICAL POINTS WHICH WILL BE INCLUDED 36
AMONG THOSE IN OUR FORMAL SUBMISSION TO THE S OF $ FOR TRADE (PARA 1(C) OF OUR TELNO 461)
WITH
(A) THE APPLICATIONS FOR A UK/HK LICENCE CANNOT BE VIEWED IN THE
SAME WWAAYY AS UK DOMESTIC LICENCE APPLICATIONS OR COMPARED
CABOTAGE APPLICATIONS TO, SAY, BERMUDA. HK IS UNIQUE AMONG
DEPENDENT TERRITORIES IN HAVING A MAJOR AIRLINE OF ITS OWN AND
AN ECONOMY SUFFICIENTLY DEVELOPED TO GENERATE A SUBSTANTIAL
PROPORTION OF THE TRAFFIC ON ITS ROUTES:
(B) UNQUESTIONABLY BUT FOR HK'S DEPENDENT TERRITORY STATUS AND IN TERMS OF NORMAL INTER-GOVERNMENTAL AIR SERVICES ARRANGEMENTS,
CPA WOULD LONG AGO HAVE BEEN DESIGNATEE AS HK'S CARRIER ON THE HK-LONDON ROUTTEE. THERE WOULD NOT HAVE BEEN A MONOPOLY NOR ANY POSSIBILITY OF A DUOPOLY OF UK-BASED AIRLINES ON THE ROUTE. THERE WOULD BE A BALANCE OR NEAR-BALANCE, ACTUALLY OR POTENTIALLY, BETWEEN THE EARNINGS OF CARRIERS BASED ON EACH END OFF THEE ROUTE. WHILE THE CAA WAS NOT REQUIRED TO HAVE REGARD TO THIS CONSIDERATION, THE QUESTION OF FAIR AND EQUAL OPPORTUNITY FOR AIRLINES AT BOTH ENDS OF THE ROUTE CANNOT, IN ALL EQUITY,
BE IGNORED.
(C) CPA AND GOVERNMENT OFFICIALS IN HK ARE AWARE THAT, OVER A LENGTHY PERIOD OF TIME WHEN THEIR APPLICATION SHOULD HAVE STOOD A GOOD CHANCE OF SUCCESS IN THE ABSENCE OF INTEREST FROM BCAL AND LAKER, CPA WERE DISSUADED BY DOT FROM APPLYING TO CAA TO SERVE THE HK-LONDON ROUTE. CPA WERE LEFT WITH THE FIRM IMPRESSION THAT THE DOT WOULD INDICATE WHAT THE RIGHT TIME WOULD BE FOR THEM
TO PUT IN THEIR APPLICATION:
(D) IT WAS DOT WHO IN THE FIRST TWO MONTHS OF 1974 APPLIED CONSIDERABLE PRESSURE TO CPA TO DISSUADE THEM FROM BUYING DC1øs,
CONFIDENTIAL
/NOW