TNAG-2313-FCO40-3357-Air-services-between-Hong-Kong-and-Austria-1991 — Page 2

2 MARSHAM STREET LONDON SWIP 3EB

FAX

TELEX

DIRECT LINE SWITCHBOARD

GTN

FAX 071 276 5390

071-276 0818

22221 DOEMAR-G

071-276

071-276 3000

276

DIRECT LINE 071 276 0533

My Ref:

Thomas Yiu Esq

ASNU

Economic Services Branch

Government Secretariat Hong Kong

Dear Thomas

Your Ref:

8 October 1991

HONG KONG/AUSTRIA AIR SERVICES AGREEMENT

Please refer to Joseph Lai's fax message of 3 October. I do have some preliminary comments on the proposed answers and these are as follows:

(a) in

in A.2 it may be worth making the point that no benefits in other respects derive from these arrangements for "British cum Hong Kong airlines", So as to make it clear that metropolitan trade-offs are no part of the deal, if that is indeed the Chinese suspicion. The decision to permit the Lauda operation on an unreciprocated basis was taken only in view of Lauda's willingness to serve a market that they had demonstrated to exist, and despite the fact that no Hong Kong airline had plans to operate on the route. Thus, when market conditions are judged to be right, we expect that a duly authorised Hong Kong airline will be providing reciprocal services.

(b) in A.3 do we want to get into the detail of pro-rate agreements, which, as is pointed out, do not concern governments? I am not sure that the final sentence, with its implication that а Lauda/CAL joint service would require (and be given?) approval by

by the aeronautical authorities, should stand either. The first sentence of the answer would therefore be, in my

my view, a sufficient response to the question.

I look forward to receiving the envisaged telegram fairly soon: the questions were handed over on 3 September and we should aim to go back with these answers, which are fairly straightforward, before too long.

Чит

enes

Martin Clem вет

M M GLASS

CONERENTIAC