TNAG-0868-FCO40-1078-Air-services-between-China--Hong-Kong-and-the-UK-1979 — Page 159

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WAS BEING PAID BY HONG KONG FOR NO EXTRA BENEFIT TO B.A. VEN IF

FURTHER LIMITED RIGHTS WERE SECURED FOR B.A, THE PRICE WOULD STILL

BE CONSIDERED EXCESSIVE. SO WE ATTACH GREAT IMPORTANCE TO B.A

VACATING THE REGIONAL ROUTE BETWEEN HONG KONG AND PEKING AS SOON AS POSSIBLE, PREFERABLY WITHIN TWO YEARS, BECAUSE THE ARGUMENTS THAT THIS SECTION IS ESSENTIAL TO THE VIABILITY OF THE TRUNK SERVICE

IS ONE WHICH NEITHER WE NOR THE HONG KONG PUBLIC FIND EASY TO

ACCEPT.

5. IN THE CIRCUMSTANCES, WE ATTACH GREAT IMPORTANCE TO THE

PROVISION FOR A REVIEW. THIS PROVISION SHOULD INCLUDE A TIGHT

DEFINITION OF WHEN THE REVIEW SHOULD BE. WE WOULD PREFER THE

REVIEW TO TAKE PLACE IN AS SHORT A TIME AS POSSIBLE AFTER THE SIGNING OFCTHE AGREEMENT, SAY, BETWEEN ONE AND TWO YEARS AS

SUGGESTED IN PARA.4 OF PEKING TELNO.499. PROVISIONS BASED ON

REACHING A GIVEN LEVEL OF TRAFFIC OR ON THE STARTING OF SERVICES

ON THE VARIOUS ROUTES (PARA.2 OF PEKING TELNO.500) COULD POSSIBLY

BE OPEN TO ABUSE WITH THE RESULT THAT WE WOULD IN EFFECT BE

LANDED WITH A VIRTUALLY INDEFINITE TRANSITIONAL PERION. ONE AIM OF THE REVIEW SHOULD BE THAT, HAVING GIVEN THE CHINESE A CHANCE TO DEVELOP THEIR TRAFFIC, THERE SHOULD BE A BALANCE OF CAPACITY ON ALL ROUTES FOR A HONG KONG BASED BRITISH CARRIER.

MACLEHOSE

FILES

MAED FED HKIGD

SEAD

LEGAL ADVISERS

MR BUTLER MR CORTAZZI, MR MURRAY MISS BROWind

[COPIES SENT TO CAD/ DOT]

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