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CONFIDENTIAL
My
It
7. There has already been extensive speculation about my decision, and it has been generally assumed that I will use my powers of political direction to allow CPA to come on to the route. ruling in favour of four carriers will, however, be unexpected. will of course be welcomed by Laker, by the majority of the Tory Parliamentary Party and, I believe, by the popular press. CPA will have reservations about competition being more fierce than anticipated but they can hardly object. BA and BCal may be infuriated, but I am confident that I can, at least, dilute the
antagonism of the BA management. BA will see the market which
BCal
has been their own divided between four rather than two airlines
which in any case they saw as damaging to their interests. has stated publicly that it is staking a great deal on the opportunities of the Hong Kong route and it may be hit hard by this competition assuming, of course, that all four airlines decide to fly the route, and that decision will be for them.
8. I have taken the Attorney General's advice on my proposed decision and he thinks it would not be easy for anyone to challenge it successfully in the Courts. In considering appeals I am bound
to have regard to the statutory duties of the CAA in the 1971 Act, but I am at liberty to reach a different decision for theirs if I am satisfied that their judgement is wrong.
9. One of those duties is to be satisfied that all services will
provide an economic return on capital for efficient operators and this would be the most likely challenge if I go ahead.
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