I have pleasure in submitting to you the attached Note of the
Agreement reached with New Zealand [1], as a guide to the
delegations from Australia and New Zealand to the forthcoming
Commonwealth talks at Montreal and to the International Aviation
Conference to be held later at Chicago.

2. You will observe that it was agreed to advocate the following
four objectives in the order of precedence shown:

(i) International ownership of the aircraft and operation of the
services over prescribed international routes by an International
Air Transport Authority appointed by the Nations:

(ii) In the event of failure to achieve the objective set out in
(i) above, the establishment of an International Air Transport
Authority with executive, economic, and other powers; any routes
and services assigned by such Authority to British Commonwealth
countries to be operative on lines similar to those described in
(iii) below:

(iii) In the event that no International Air Transport Authority
is established, even in accordance with (ii) above, and that a
technical Convention only is agreed to, Australia and New Zealand
will advocate the establishment of Commonwealth air trunk routes,
to be operated preferably by a British Commonwealth and Empire
Corporation, wholly Government owned, on the lines of the
Australian plan prepared in London. [2] Such a Corporation would
operate these Services under the aegis of a Commonwealth Air
Transport Council representative of all Commonwealth Governments:

(iv) In the event of failure to secure agreement among
Commonwealth countries to the establishment of a single airline-
operating Corporation to operate intra-Commonwealth Services,
Australia and New Zealand will advocate the operation of British
Commonwealth routes by airline operators of the Commonwealth
countries, the routes and services to be assigned to the
respective Commonwealth countries by the Commonwealth Air
Transport Council.

[matter omitted]

ARTHUR S. DRAKEFORD