TNAG-1434-FCO40-1917-Hong-Kong-leading-personality-Sir-Yue-Kong-Pao--businessman-1986 — Page 322

DOGABE

CONFIDENTIAL

SIR Y K PAO'S CHEVENING WEEKEND 15-16 MARCH 1986

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X. CIVIL AVIATION: DRAGONAIR AIRLINES (DAL)

Background

1. The Secretary of State for Transport will be lunching

with Sir Y K Pao on 19 March when Sir Y K will

YK

no doubt

raise the future of DAL. There are a number

a number of outstanding issues concerning DAL's wish to operate both scheduled and

non- scheduled services to destinations in the Far East and

Europe that must

resolved before the airline can

establish itself a s

commercially viable operation.

be

Detailed questions on the future of DAL should be raised

with Mr Ridley.

2.

DAL' s origins are shrouded in mystery.

It was

incorporated in Hong Kong in September 1984, following the signing of the Joint Declaration which envisages special

treatment for

for airlines incorporated in and with their Head

offices in Hong Kong. It met these criteria but not the

normal requirements in our Air Service Agreements (ASAs)

ог

that it should be owned and controlled by HMG, HKG British Nationals, and was originally owned and controlled by Chinese interests. In May 1985 DAL acquired a Boeing 737 aeroplane and was granted an airline operators certificate by the Director of Civil Aviation (DCA) Hong

Kong.

Scheduled Services

3.

To operate international scheduled services from Hong Kong an airline must first of all be licensed by the Hong Kong Air Transport Licencing Authority (ATLA) to operate on specific routes. Once an ATLA licence has been obtained

CONFIDENTIAL