TNAG-0870-FCO40-1080-Air-services-between-Hong-Kong-and-the-UK-1979 — Page 13

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(B) IN CONTRAST, C.A.A ARE BOUND BY THE CIVIL AVIATION ACT 1972 WHICH INCLUDES PROVISIONS FOR THE SECRETARY OF STATE TO ISSUE STATUTORY GUIDANCES TO CAA WHICH ARE ALSO BINDING UPON THEM. FEBRUARY 1976 A GUIDANCE WAS ISSUED BY S OF S FOR TRADE IN THE PREVIOUS GOVERNMENT. THAT GUIDANCE STILL REMAINS BINDING UPON CAA. OUR LEGAL OPINION EXPRESSES THE VIEW THAT THE EFFECT OF THIS GUIDANCE AND SECTION 3 OF THE ACT, READ TOGETHER, IS TO CREATE ''LEGISLATIVE PREJUDICE'' THE RESULT OF WHICH IN THE Q.C'S OPINION

3.

IS -

(1)

LIKELY TO PREVENT ANY APPLICANT AT ALL SUCCEEDING BEFORE THE CAA UNLESS BRITISH AIRWAYS CONSENT (AND IT IS THIS NEED FOR CONSENT THAT MAKES THE OUTLOOK EVEN WORSE THAN WE THOUGHT WHEN WE SENT YOU OUR TEL NO.959),

(11) CERTAINLY TO FAVOUR BCAL OVER BOTH CPA AND LAKER TO THE EXTENT THAT THE CHANCES EVEN OF LAKER SUCCEEDING ARE MINIMAL EVEN IF IT WERE TO. PROVE BEST ABLE TO SERVE THE PUBLIC NEED, AND (111) TO DISADVANTAGE CPA, IT NOT BEING A BRITISH AIRLINE'', IN ADDITION TO THE ALREADY SEVERE DIFFICULTIES SET OUT IN SUB PARAS. (1) AND (11) ABOVE, TO THE EXTENT THAT IT IS SIMPLY UNABLE TO SUCCEED BEFORE THE CAA (THIS TOO IS A NEW ASPECT OF THE MATTER).

IN THESE CIRCUMSTANCES, IT SEEMS TO US THAT ATLA AND CAA OPERATING AS THEY DO UNDER DIFFERING LEGAL CRITERIA WILL PROBABLY

GIVE CONFLICTING DECISIONS. IF THIS PROVES TO BE THE CASE, AT THE VERY LEAST, UNACCEPTABLE DELAY IN THE START OF A SECOND SERVICE Strong WILL RESULT. BUT IF NO WORKABLE SOLUTION AT ALL IS REACHED AFTER

a bit

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HEARINGS IN BOTH HONG OKONG AND U.K THEN THERE IS CERTAIN TO BE AN UNFAVOURABLE REACTION IN HONG KONG. THIS REACTION WOULD DEVELOP INTO A PUBLIC OUTCRY IF CPA WERE SHOWN TO HAVE BEEN STATUTORILY PREJUDICED. AS THE PREJUDICE WOULD ALSO HAVE AFFECTED LAKER, WE IMAGINE THERE MIGHT WELL BE AN ADVERSE REACTION IN THE U.K TOO,

POSSIBLY EVEN IN PARLIAMENT.

4.

AS SEEN FROM HERE, WITH RESPECT, WE DO NOT FIND THE REASONS ADVANCED IN YOUR TELNO.672 TO BE AS COMPELLING IN THE NEW SITUATION AS AT FIRST SIGHT THEY MIGHT APPEAR TO BE. SO FAR AS THE 'VIRES' POINT IS CONCERNED: THE OPINION SETS OUT DIRECTIONS WHICH WE ALSO AGREE WOULD APPEAR TO BE INTRA VIRES. SO FAR AS S OF S FOR TRADE REVERSING STATUTORY PROVISIONS IS CONCERNED THE OPINION ALSO REFERS TO THIS AND WE NOTE THAAT IN THE LAKER CASE LORD DENNING SPECIFICALLY STATED ''SECTION 4 CONFERS EXCEPTIONAL POWERS ON THE S OF S. IT ENABLES HIM TO OVERRIDE STATUTORY REQUIREMENTS AS TO LICENCES AND ALSO TO BY-PASS THE GENERAL OBJECTIVES'', SET OUT

C