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Legislative amendments to be gazetted to better regulate local airlines
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     The Air Transport (Licensing of Air Services) (Amendment) Regulation 2011 (the Amendment Regulation) will be gazetted on November 18 and tabled in the Legislative Council on November 23.

     The Amendment Regulation seeks to improve the regulatory regime of the Air Transport Licensing Authority (ATLA) for local airlines, a spokesman for the Transport and Housing Bureau said today (November 16).  The relevant stakeholders have been consulted and generally support the legislative proposals.

     "In order to safeguard the interests of passengers, the amendments will improve the existing regulatory regime by enhancing the ATLA's financial monitoring capability through powers to intervene when licence holders get into financial difficulty.  The licence holders will also be required to notify the ATLA on specific events and submit annual financial statements etc so that the ATLA will be in a better position to assess the continuing capability of licence holders in operating air services. The current regime does not require licence holders to notify the ATLA in case they run into financial difficulties, nor does it provide the power for the ATLA to carry out post-licensing monitoring work on the licence holders," the spokesman said.

     The Amendment Regulation improves the regulatory regime in the following main areas:

(a) to update the ATLA's general policy so that the ATLA can focus on the development of air services provided by local airlines instead of concerning itself with the co-ordination and uneconomical overlapping of air services;

(b) to adopt an airline-based approach under which each airline will only be granted one licence specifying the routes to be operated;

(c) to require licence holders to notify the ATLA of specific events; provide the ATLA with audited financial statements every year; and inform the ATLA of their financial difficulties or intention to cease to operate air services or such cessation;

(d) to give the ATLA powers to require licence holders to provide relevant information for assessing their financial position; suspend or revoke licences; attach new licence conditions or vary existing ones; and to grant temporary licences; and

(e) to update the existing penalties for using any aircraft in contravention of the provisions of the Air Transport (Licensing of Air Services) Regulations, and to introduce new offences in respect of failure to comply with the proposed notification requirements.

     Given the proposed adoption of an airline-based approach, there will be appropriate transitional arrangements for existing licence holders.  The fee structure will also be revised.

     The opportunity is also taken to amend the law so that an airline other than a local airline need not obtain a licence from the ATLA before leasing a Hong Kong-registered aircraft to operate scheduled air services between Hong Kong and another place as it suffices for the airline to be regulated by an operating permit issued by the Civil Aviation Department.

     The legislative amendments will come into operation on a date to be appointed by the Secretary for Transport and Housing.

     The ATLA, established under the Air Transport (Licensing of Air Services) Regulations, is responsible for granting licences to local airlines to operate scheduled air services between Hong Kong and any point in the world.

Ends/Wednesday, November 16, 2011
Issued at HKT 20:06

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