Cathay Pacific

Cathay Pacific chief says Jetstar Hong Kong licence goes against Basic Law

PUBLISHED : Friday, 27 September, 2013, 12:00am
UPDATED : Friday, 27 September, 2013, 2:31am

Cathay Pacific Airways has fired another salvo against Jetstar Hong Kong in its bid to block the launch of the low-cost carrier.

John Slosar, the chief executive of Hong Kong's main airline, said it would be unfair if Jetstar Hong Kong - which he described as a franchise of foreign carriers - were granted air traffic rights in the city.

The start-up airline, which was established by Australia's Qantas Airways and China Eastern Airlines last year, invited Shun Tak Holdings to be a shareholder in June - in a bid to boost its local credentials.

"Its parent company, Qantas, have openly admitted they are setting up a franchise," Slosar was quoted in CX World, a monthly publication issued by Cathay. He said it would break Article 134 of the Basic Law if the government granted a licence to Jetstar Hong Kong.

"It wouldn't be good for Hong Kong if any airline can simply come in and set up a franchise."

The Air Transport Licensing Authority is considering an application from Jetstar Hong Kong.

The civil aviation sector is highly regulated, with airlines needing to secure air rights at cities, with these rights subject to talks between governments.

"As a franchise of a foreign airline, why should Jetstar Hong Kong just come in and grab traffic rights that our government has negotiated to secure?" Slosar said. "The bilateral system is based on a principle of 'you give something, you get something', but Jetstar seems to want to take and not give. This cannot possibly be in the interest of Hong Kong."

He reaffirmed that Cathay is not afraid of the competition because it already competes with 107 airlines - 17 of which are low-cost carriers.