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DELTA SAYS USAIR/BRITISH AIRWAYS AGREEMENT RUNS COUNTER TO UNITED STATES LAW AND POLICY

 DELTA SAYS USAIR/BRITISH AIRWAYS AGREEMENT RUNS COUNTER
 TO UNITED STATES LAW AND POLICY
 ATLANTA, Aug. 3 /PRNewswire/ -- Delta Air Lines (NYSE: DAL) has advised the U.S. Department of Transportation of its opposition to the USAir and British Airways agreement in which British Airways plans to invest $750 million in the American carrier.
 Delta Chairman and Chief Executive Officer Ronald W. Allen, said: "The USAir/British Airways transaction must be seen for what it is -- a foreign carrier cloaked in the protection of one of the most restrictive and anti-competitive international aviation regimes in the world, seeking control over a U.S carrier in violation of our government's current law and policy."
 Allen pointed out that the Federal Aviation Act, as consistently interpreted and applied over the last 50 years prevents a foreign air carrier from exercising control over a U.S. air carrier. Therefore the Department of Transportation, as a matter of law, must take action to prevent consummation of this agreement. "Under this agreement," Allen explained, "British Airways will exercise control over virtually every significant business activity of USAir. British Airways will be the largest single stockholder voting the largest single block of stock. They will have effective control over major corporate and business decisions of USAir by virtue of super majority voting rights on the USAir Board. These rights cover all manner of management control including senior executive hiring and salaries to development of operating and capital budgets and spending in excess of $10 million. Clearly British Airways wants to control USAir in violation of long established U.S. law and policy.
 "There can be no dispute that the U.S. - United Kingdom aviation relationship is one of the most restrictive in the world," Allen elaborated. "Even if control were eliminated, the Department of Transportation is obligated to protect U.S. interests by requiring, as a precondition to allowing the transaction to go forward, a revised U.S. - U.K. aviation agreement that will give U.S. carriers free and open access to and from British cities."
 Allen continued: "It would be unconscionable for the U.S. Government to permit British Airways, which derives enormous financial benefits from the restrictive, protectionist United Kingdom policy on international airline competition, to gain unprecedented access into our domestic markets while U.S. carriers continue to be foreclosed from providing needed U.S. - U.K. competitive services. To permit British Airways the market access contemplated in this transaction without obtaining a complete liberalization of the U.S. - U.K. aviation regime would be tantamount to unilateral economic disarmament."
 Delta said foreign carriers simply cannot be allowed to violate existing U.S. law and policy. If this transaction is approved, Delta firmly believes that the industry's competitive edge in the global marketplace will be sacrificed, not unlike the experience of U.S. automobile and steel industries. Rather than protecting jobs, as British Airways and USAir will likely claim, the jobs of an entire U.S. industry are at stake as well as jobs at the many vendors who support the airline industry. The end result will be more jobs going overseas as well as more dollars. We are rapidly becoming a nation which is losing jobs rather than creating and maintaining jobs for our people.
 Allen said Delta has long promoted open trade, but that should be accomplished only on the basis of a clear U.S. international aviation policy yet to be developed, and of a fair and equal opportunity for the airlines of all countries involved. "But," he said, "the United Kingdom has repeatedly blocked Delta and other carriers which wanted to expand in the highly restricted U.S. - British markets, instead protecting British Airways from competition despite the carrier's privatization. The USAir/British Airways agreement must be stopped, and our government must send a message to all our trading partners that the free and open international aviation markets that the U.S. seeks means equal benefits for all carriers."
 -0- 8/3/92
 /CONTACT: Delta Air Lines public relations, 404-715-2533/
 (DAL) CO: Delta Air Lines, Inc.; USAir; British Airways ST: Georgia IN: AIR SU:


BR -- AT001 -- 5970 08/03/92 08:15 EDT
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Publication:PR Newswire
Date:Aug 3, 1992
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