CONFIDENTIAL
10.
The line against me would be that one or more of the four licensees would not be able to make a profit, even after a reasonable period, so that the requirement of an economic return would not be satisfied and that a direction to grant further licences would accordingly be invalid. But I believe that this is not the case and that the CAA's approach was. far too restrictive. For my decision to be upset in the Courts it would be necessary for objectors to show that it was manifestly ⠀⠀ unreasonable, on the basis of the evidence, for me to allow four operators on the route and hence that I had not had proper regard to the particular statutory duty referred to above. Attorney General thinks that the objectors would have a difficult task in showing that the evidence (although certainly speculative) could not reasonably support my decision.
The
11. He thinks that for the reason given in my proposed decision letter (the drafting of which he has approved) my decision could be supported. In the event of a legal challenge he therefore advises that my chances of success are at least even.
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12. There is an outstanding hurdle in that the Hong Kong Air Transport Licensing Authority (ATLA) has issued licences for BCal and CPA but not for Laker. Whilst we have no means of forcing a reversal of this decision by an independent tribunal I intend that our reply to the request by the Hong Kong Government for special action in support of CPA should express the hope that they would feel able to give evidence to the Hong Kong ATLA in support of the four carrier solution at any fresh hearing on Laker's application.
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