|Quoting Atmx2000 (Reply 80):|
Bermuda II restricted more extensive fifth freedom rights that had existed prior, basically limiting them only to West Germany and a select few other cities
Are you saying that the fifth freedom rights allowed in Bermuda2 were worthless and that first PA and then UA should not have based short haul fleets in Europe? Remember I was answering a question as to what American airlines got out of Bermuda 2 and clearly Bermuda 2 did not have to include fifth freedom rights.
|Quoting Atmx2000 (Reply 80):|
You are calling this compensation? So BA gets to operate both LHR-IAH with a stop and LGW-IAH nonstop.
No. Unlike some I am trying to take a balanced view. In some cases Bermuda 2 does create an uneven playing field in favour of BA, the only nominated UK airline allowed to operate from LHR in competition with PA and TW in the original agreement. And in some cases Bermuda 2 creates an uneven playing field in favour of either the two original airlines nominated to serve LHR, PA and TW, and sometimes in favour of the American airlines not allowed to serve LHR. And I certainly do not wish to take a jingoistic view.
So I am not really sure exactly what you are saying. Is it that BA has an unfair advantage in being allowed to fly IAH-DET/ORD-LHR? If so it is worth pointing out that Bermuda 2 allows both AA and UA to operate in a similar fashion. Hence UA956 used to operate SFO-JFK-LHR until UA could not stand the competitive heat on the JFK-LHR route (being at a disadvantage in not having a hub on this route) and withdrew this service at the end of the 2006 summer schedules. Similarly I believe all the following services still operate even though a change of plane may be required:
The difference between these flights and the BA IAH-ORD-LHR or IAH-DET-LHR flights is that UA can carry passengers on the first leg but BA cannot. One must assume that to operate the above services UA must see some commercial advantage, over, for example operating a PDX-ORD flight that connects with an ORD-LHR flight. But this commercial advantage is denied to BA or VS under both Bermuda 2 and the new Open Skies agreement.
|Quoting Avek00 (Reply 77):|
Quoting VV701 (Reply 73):
Today it is privately owned. Significantly more than 40 per cent of its equity is now in foreign mainly American hands. This, under restrictive American law, could not have happened in the USA.
Not at all true - this has already happened at least once with a major US airline (Northwest).
Are you saying that NW is more than 25 per cent foreign owned? I thought that this was illegal under US law. But is it that greater than 25 per cent ownership is legal provided that no one foreign investor owns more than a certain percentage? Or did foreign ownership once go above the legal limit and corrective action - like the issue of more stock - had to be taken?
As long as Bilateral Agreements continue to exist then foreign ownership (i.e. more than 50 per cent) is always a problem for any international airline. So in theory BA could not operate under existing bilateral agreements signed by the UK if foreign ownership exceeds 50 per cent. As their is no requirement in UK law that BA remains a British company, BA are legally required to monitor the ownership of their stock. And there is a mechanism in place to take action if foreign ownership exceeds 50 per cent.
This mechanism involves an independent British financial institution who are identified in BA's articles of association. If foreign ownership of BA Ordinary Stock exceeds 50 per cent BA are required by these articles to issue a new class of share to this institution in a number equal to the number of shares over 50 per cent owned by foreign investors plus an additional share. These special shares do not qualify for many of the benefits of the BA ordinary shares like stock dividends, stock scrip issues or participation of capital distributions if BA were to be taken over or if its assets were sold. But in a sort of contorted way they keep BA British.
As a result BA publish the actual foreign ownership of their shares on 31 March each year in their annual report issued in mid-summer (as do LH I believe for the same reason).