CONFIDENTIAL
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framework of the CMU. In particular, we should seek increased
services for CPA to Shanghai, in line with market growth, and
local rights for BA between Hong Kong and Peking in exchange for
additional services on the same routes by CAAC.
4.
The Hong Kong Government raised with Mr Sproat on his
visit to Hong Kong in July the case for terminating BA's
exemption from the requirements of the Hong Kong Air Transport Licensing Authority. All other airlines, whether Hong Kong, UK
or foreign based, have to apply for a licence to serve Hong
Kong: BA do not. When the matter was last considered in 1981 it
was decided after reference to the Prime Minister that the
balance of argument favoured retention of the exemption. DOT Ministers are considering whether there is anything in Hong Kong's latest case which would justify reversing that decision.
Hong Kong and General Department
November 1982
CONFIDENTIAL