TNAG-0870-FCO40-1080-Air-services-between-Hong-Kong-and-the-UK-1979 — Page 55

A

CONFIDENTIAL

MRA 184/393/1

Miss Brown

Mr Murray

HICK 184/5

* AIVED IN RE" 'STAY MO

M

2 1 AUG 1979

OFFICER

PA

RC

21.8

PA.

M

Quantill

: N Williamson 20

33

you had betterbring

rself up to date on the

sage. Granges- this

82078

AIR SERVICES ON THE LONDON-HONG KONG ROUTE

Problem

1. To reply to Mr Roberts' letter of 3 August.

Recommendation

2. I recommend that Mr Murray should reply to Mr Roberts on

the lines of the attached draft. HK&GD and Legal Advisers

concur.

Background

3. After persistent criticism in Hong Kong of the present

British Airways monopoly on the London-Hong Kong route we

and the DOT were asked in March by the Hong Kong authorities

to consider the possibility of a second scheduled service

on the route. They considered this should be operated by a

Hong Kong based airline. It was agreed between the Hong Kong

Government and the DOT that a number of papers should be

prepared, including a joint study by BA and Cathay Pacific

Airways (CPA) of the market prospects, with the aim or reaching

a decision this autumn on whether CPA should be allowed to

introduce a London-Hong Kong service. At the end of May however

British independent airlines, Laker and British Caledonian,

filed applications with the Civil Aviation Authority for licences

to operate on the London-Hong Kong route. Although DOT

officials proposed that the CAA should be directed not to consider

these two applications and that they should instead be taken

into account in the inter-governmental consultations the

Secretary of State for Trade decided that it would not be

CONFIDENTIAL

•

/ appropriate