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HIM THAT WE WERE NOT SEEKING ANY COMMITMENT, ALL WE WANTED WAS ONLY AN AGREEMENT FROM THE BURMESE SIDE TO COMMENCE NEGOTIATIONS.
3. THE BURMESE ALSO RAISED ANOTHER MATTER FOR DISCUSSION. WE WERE GIVEN TO UNDERSTAND THAT MYANMAR AIRWAYS HAD SIGNED AN AGREEMENT WITH A SINGAPOREAN COMPANY, HIGHSONIC ENTERPRISE PTE LTD, TO FORM A JOINT VENTURE COMPANY, MYANMAR AIRWAYS INTERNATIONAL, TO TAKE OVER THE INTERNATIONAL SERVICES OF MYANMAR AIRWAYS. NO DETAILS ON OWNERSHIP AND CONTROL WERE GIVEN TO US BUT WE UNDERSTAND THAT THE BACK-UP FINANCE MIGHT BE INDONESIAN. AS CURRENT HONG KONG/RANGOON SERVICES WERE STILL OPERATING UNDER THE 1952 UK AGREEMENT THE BURMESE EXPRESSED CONCERN ON WHETHER THE JOINT VENTURE COMPANY, IF FORMED, WOULD FULFIL THE AIRLINE DESIGNATION CRITERIA THEREIN. WE SAID THAT WITH NO DETAILS ON THE JOINT VENTURE COMPANY WE WERE UNABLE TO COMMENT. HOWEVER, THE UK AGREEMENT REQUIRED THE DESIGNATED AIRLINE TO BE SUBSTANTIALLY OWNED AND EFFECTIVELY CONTROLLED BY THE GOVERNMENT OF BURMA OR ITS NATIONALS, AND THERE COULD BE A POTENTIAL PROBLEM IF SUBSTANTIAL OWNERSHIP AND EFFECTIVE CONTROL OF THE JOINT VENTURE COMPANY WAS NOT IN BURMESE HANDS. WE SUGGESTED THAT THEY SHOULD DIRECTLY APPROACH DTP ON THE MATTER, GIVING DETAILS OF THE JOINT VENTURE, WHEN AVAILABLE. WE NEVERTHELESS TOOK THE OPPORTUNITY TO EXPLAIN THE DESIGNATION CRITERIA IN HONG KONG ASAS, THAT IS, A PLACE OF INCORPORATION AND PRINCIPAL PLACE OF BUSINESS. THEY NOTED THAT THIS COULD BE A FACTOR FAVOURING THEIR HAVING A SEPARATED ASA WITH HONG KONG. THEY ALSO INDICATED THAT THE NEW JOINT VENTURE COMPANY MIGHT USE A DIFFERENT AIRCRAFT TYPE ON THE HONG KONG ROUTE. WE SAID THIS SHOULD NOT BE A PROBLEM AS LONG AS THE REQUIREMENTS OF THE HKCAD WERE MET.
PATTEN
YYYY
MAIN
44
.AIR SERVICES
AMD
LEGAL ADVISERS
PUSD//MR HARRISON E203
HKD
SEAD
PS
ADDITIONAL
4
D/TP//IAD RM S608
NNNN
DISTRIBUTION
48
PS/MR LENNOX-BOYD PS/PUS
MR CROWE
MR BONE
MR HUM
MR MASEFIELD
PAGE
2
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