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Civil Aviation (Bermuda Agreement)

Volume 928: debated on Monday 21 March 1977

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asked the Secretary of State for Trade what further progress has been made on renegotiating the Bermuda Agreement.

The fourth round of negotiations for a new Air Services Agreement was held in London from 28th February to 11th March. Some progress was made towards agreement on the methods of regulating capacity on North Atlantic services and establishing tariffs. The negotiations will be resumed in Washington on 28th March.

Is it not the case that the Americans have still absolutely no intention of restricting the activities of their airlines to a policy of single designation? What is the Government's policy with regard to regulation as opposed to competition?

The Government are in favour of competition, but not by means of putting such grossly excessive capacity on the North Atlantic that it means a gross waste of fuel at a time when energy conservation is important and leads to excess fares paid by customers travelling over the North Atlantic. It is not true to say that the United States has entirely ruled out the idea of single designation. What we are concerned with is a system of capacity control. In the last negotiations the United States made certain proposals in this regard. We are now negotiating with the United States, and I am sure that the hon. Gentleman would not wish me to reveal the whole of our negotiating position.

Within the concept of capacity control, will the Minister consider introducing regulations for the control of air freight and passenger charter flights?

We have, of course, considered whether charter should come within the renegotiation. The present view of both parties is that it should not, althugh charters are closely connected with services across the North Atlantic. That is the basis upon which we are negotiating at the moment and it seems more convenient to both sides. We want a memorandum of understanding with the United States to govern the operation of charters, and I think that that is better done outside these negotiations.

As the United States Government have already stated that they do not have the authority to stop aircraft in certain circumstances landing within the United States, is the right hon. Gentleman satisfied that they are in a position of authority to sign such an agreement?

That is a very interesting question which we shall have to discuss during the negotiations. We have had many disagreements with the United States Government on the interpretation of the Bermuda Agreement. One of the reasons why we wish to renegotiate the agreement is so that we can have an agreement that both sides understand and which is actually operated. We believe that there are cases where the United States has not operated the Bermuda Agreement. The landing rights of Concorde at New York are one example.