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Cathay Pacific flying to mainland "in the interests of Hong Kong"

20 Mar 2003

Cathay Pacific Airways today concluded its final summation at the Air Transport Licensing Authority (ATLA) hearing, asserting that the Tribunal urgently granting the airline an unlimited licence to fly to Shanghai, Beijing and Xiamen would "clearly be in the interests of the Hong Kong public".

Counsel for Cathay Pacific, Mr Charles Haddon-Cave, QC, said the ATLA panel need consider only two questions: what drop in passengers and what impact on revenue Dragonair can expect if Cathay Pacific serves the three Chinese Mainland cities.

"We have made an overwhelming case for the grant of an unlimited licence to the three routes," Mr Haddon-Cave said. Cathay Pacific "will have a strong positive effect on development of air services in the region, and, ultimately upon Dragonair itself. It is clearly in the interests of the Hong Kong public to grant these licences."

The model used by Dragonair to support its objection to Cathay Pacific's licence application was, said Mr Haddon-Cave, "fundamentally flawed and a wholly unreliable guide as to likely future passengers numbers".

He reminded the panel that Cathay Pacific's ability to attract its target 420,000 incremental passengers over Hong Kong by serving the three Chinese Mainland cities was well within the airline's grasp. He said that last year the airline carried 400,000 passengers from Japan alone who made through connections with Cathay Pacific in Hong Kong to destinations beyond. China's outbound market is fast growing also.

He also rejected arguments made yesterday by Dragonair that, under the Basic Law, it would be illegal for ATLA to grant Cathay Pacific licences to Shanghai and Xiamen.

"An ATLA licence is just a licence; it does not entitle [an airline] to operate. So the idea that the issuance of a licence in the time-honoured way will cause harm politically or break the equilibrium or harm the administration of aviation in the Hong Kong SAR is simply breathtaking," Mr Haddon-Cave said.

He added: "It is inconceivable that the framers of the Basic Law intended to remove the rights of airlines to apply for licences, the power of ATLA to grant them and the entitlement of the government to receive the benefit and guidance of ATLA in relation to these matters."