U.S. accuses Air N.Z. of fare breach

Press, 23 April 1979, Page 1

U.S. accuses Air N.Z. of fare breach

NZPA staff correspondent Washington Air New Zealand has raised fares unilaterally between Auckland and Pago Pago in the last two days in violation of the New Zealan d-United States bilateral air agreement, Washington sources charged yesterday. The same sources said Air New Zealand additionally had advised all international carriers serving New Zealand to raise all fares out of New Zealand by 7 per cent from May 1. The 7 per cent increase, approved earlier by the International Air Transport Association to cover higher fuel costs, is be-

lieved to have been announced in New Zealand. But the United States had not accepted the I.A.T.A. increase, and thus this move is seen as being in violation of the bilateral agreement. None of the plans for increases has been filed with the Civil Aeronautics Board in Washington, the required routine for consideration of higher fares. Air New Zealand’s moves are being discussed by aviation officials within the Carter Administration.

A spokesman for the State Department’s Aviation Negotiations Division, confirmed yesterday that it was aware of the re-

ported amended fares and was investigating them. He said it was possible that the New Zealand Government had approved a request for a higher fare on the Auckland-Pago Pago route on the assumption Air New Zealand had filed with the board. But a board official told NZPA there had been no recent filings by Air New Zealand. The State Department spokesman said that the higher fares being charged between Auckland and Pago Pago might be the result of a “legitimate misunderstanding.” The spokesman indicated that the 7 per cent increase was being viewed as more blatant; Air New'

Zealand knew the rules and he was surprised at the move.

The Washington sources who disclosed the Air New Zealand action said the airline could not legally charge the higher fares because no such tariffs had been approved by the Civil Aeronautics Board.

New Zealand-United States fares must be approved, in terms of the existing bilateral agreement by both governments.

The United States Government clearly has not approved the new fares, the sources noted.

The present legal fare between Auckland and Pago Pago was $459 first

class, and $306 economy one way. they said. Air New Zealand apparently had begun charging $505 and $336 respectively. The sources said documentary proof of the higher fares was being obtained. Fares from Pago Pago to Auckland are said to be at the old, lower rate. Perhaps not coincidentcidentally the higher rates are reported to be what New Zealand has been insisting Continental Airlines must charge. The New Zealand-Pago Pago northbound fare is one of the issues at the centre of the fares dispute between New Zealand and Continental Airlines,

which plans to start service between the United States and Auckland on May 1. Continental is opposed to the higher fares and the sources say it regards them as excessive and unjust. and unlikely to be approved by the board. The sources are not clear what is behind the Air New Zealand move. "You will have to ask the airline for an explanation,” they said. The State Department spokesman said the reported New Zealand action made it appear as if New Zealand had embraced the “country of origin" rule on fares. "If it is the case, we

will be happy to write such an agreement and sign," he said A country of origin agreement means that a government can set fares on flights departing its shores without reference to the nation where the flights terminate The United States unsuccessfully sought such a system in the recent air talks with Air New Zealand in Washington. If the Air New Zealand fare moves are found to be as disclosed by the Washington sources, the State Department will seek an explanation from New Zealand and possibly call for consultations.