CONFIDENTIAL

Shanghai, which

(CPA) were

are

already

rejected

by

served by Cathay

the Hong Kong authorities,

Pacific Airways

who have

indicated that in general they do not favour allowing more

one Hong Kong airline to serve any one route.

15.

from

than

DAL would also like to operate scheduled services to the UK (the route is already served by CPA, BA and BCal). If they can

obtain

licence for such

service a

the Hong Kong

authorities, the two Governments will need to consider whether

and if so on what basis it should operate.

a

16.

DAL also wish to

Asia, Europe and the UK.

mount charter services to points in SE

Hong Kong has complete autonomy in all

charter matters and does not need to refer to HMG. Usually such

authorities

demand.

are

only permitted

far

DAL's

flights

if the Hong Kong

scheduled services satisfied that scheduled

cannot meet the

charter activity has been

to confined

are

So

occasional

DAL's application to operate

refused by the Hong Kong

1986. February

A similar

services to Malaysia and Thailand.

charter services to London was

authorities at

beginning of charter application from a London based airline, London Express Aviation, has also been refused by Hong Kong.

the

17.

Recent contacts

wi th

that DAL has the

confirmed

officials Chinese

senior

support of influential Chinese to allow DAL

Peking and that the Chinese would be prepared

have

in

to

operate s ome

Shanghai.

to services

major

that It is expected

cities such

of air further round a

as

Peking

and

service

talks will be held with the PRC in the coming months when we shall be able to test the basis on which DAL might be accepted on routes between Hong Kong and the Mainland.

the DTI

an

18. We understand from interest in expanding their fleet by purchasing BA146 and Airbus

that

DAL have expressed

aircraft. We welcome

preferential

treatment

but this,

for DAL

i t

in

the negotiation of

cannot be linked

to

any

traffic

rights.

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