TNAG-0870-FCO40-1080-Air-services-between-Hong-Kong-and-the-UK-1979 — Page 96

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CONFIDENTIAL

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DEPARTMENT OF TRADE

1 VICTORIA STREET

LONDON SWIH OET

TELEPHONE DIRECT LINE 01 215

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3229 t.

SWITCHBOARD 01 215 7877

HAH Cortazzi Esq CMG

Foreign and Commonwealth Office

Downing Street West

London SW1A 2AL

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"Dear Hugh,

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- 9 AUG 1979

AIR SERVICES ON THE LONDON-HONG KONG ROUTE

40.51

August 1979

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Mr McLaren

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Mr Murray 0.5.

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I am sorry to find that you have had no reply to your letter ear.

of 22 June to John Steele, who is at present on leave. This

was remiss of us, and I apologise.

emiss of us, and I apologise.tter

2 As John Steele said in his letter of 18 June, it was in the light of advice from our Solicitor that my Secretary of

indeed

State decided not to direct the CAA to regard CPA as on an

But Mr Nott reached equal footing with the UK based airlines. this conclusion for both policy and legal reasons, primarily the former. He took the view that Parliament, in passing the Civil Aviation Act 1971, had decided how it wished the CAA to carry out its duties, and that he did not wish through a Direction to reverse a provision stated clearly in an Act of Parliament. This is consistent with his whole approach to the issue of additional carriers on the London/ Hong Kong route. He does not want to interfere in any way with the normal statutory procedures 'governing the CAA hearing. It is not only the Hong Kong Government and CPA, but also BCAL and Laker, who are watching our every move in this case, and will not hesitate to exploit any excuse we may give them for criticism, if they judge it to be to their commercial advantage.

3

The legal reasons for not issuing this directive are set out in the enclosed minute from one of our Assistant Solicitors, of which your Legal Advisers have a copy. As you will see, our lawyers acknowledge that a different view to theirs is possible, but at the very least we feel that there is significant doubt whether the Direction would be intra vires.

4 Apart from the question of this Directive, the Departments concerned have agreed on the text of a telegram to go to Hong Kong in reply to their telegram_959 of 10 July about the implications for CPA of the statutory duties laid on the CAA in considering applications for air transport licences.

CONFIDENTIAL