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20
ECRET
By-laws of this decree outlined details of
and reorganization of the Argentine airline
organization of the mixed companies which
network, competition was avoided by limit-
operated Argentina's air services until nation-
ing the number of air transport companies and
alization of all airlines in May 1949, well ahead
fixing the areas within which each was to
of the generally anticipated schedule.
operate. Each of the three domestic airlines
Early in 1949, a commission composed of
was assigned to a specific region. Although
representatives of the various government de-
this policy avoided competition, it also pre-
partments concerned was charged with draw-
vented realization of a unified national air
ing up a draft Civil Aviation Code, as well as
network. Reorganization measures, however,
regulations to govern civil air affairs. Until
have combined the three former domestic air-
this project can be concluded and officially
lines into a single carrier providing improved
approved, however, aviation matters will con-
service.
tinue to be administered by directive and
c. Regulation of Foreign Airlines.
decree. Government action taken to date in-
Argentina terminated all cabotage rights
cludes reclassification of Argentine airports
for foreign airlines on 2 January 1947. The
to conform with ICAO recommendations, es-
rights now enjoyed in Argentina by foreign
tablishment of a new scale of landing charges,
airlines are determined on the basis of formal
and issuance by decree of aircraft registra-
bilateral air agreements. The "regional (in-
tion regulations.
ternational) cabotage" policy of Argentina is
b. Regulation of Argentine Airlines.
discussed below in Section 3 under the head-
In accordance with the first item of the
ing "International Civil Aviation Policy.'
Basic Air Policy, four mixed airline companies
d. Promotion of Other Civil Aviation Ac-
were decreed early in 1946. FAMA (30 per-
tivity.
cent government-owned) operated only inter-
national services, while Aeroposta, ALFA, and
In compliance with the Basic Air Policy, all
ZONDA (each 20 percent government-owned)
airports and air navigational facilities in Ar-
provided primarily domestic service. Gov-
gentina have become the property of the gov-
ernment and are controlled by the Ministry
ernment control over management and oper-
ations was so rigid, however, that the private
of Air. This also applies to meteorological
interests were unable to exercise effectively
stations and aerial cartographic offices. Un-
their prerogatives, with the result that these
der the Argentine Government's five-year plan
companies never actually operated as mixed
of 1947, the State has undertaken an extensive
companies. On the pretext that this form of
airport building and development program.
organization was uneconomic and had caused
Aero club training and flying is facilitated
severe financial losses (covered by govern-
by substantial government subsidy and tech-
ment subsidy), nationalization of the mixed
nical aid. The State, however, retains strict
companies was decreed in May 1949. All pri-
and complete control over these operations,
vate shares were paid off and operational re-
which are designed to fit into the pattern of
organization designed to bring about the de-
military training. All other aeronautical
sired economies was announced in October
training is under direct military supervision.
1949. (See Section 4, Airlines.) There has
While Argentine aviation policy theoreti-
been no foreign capital participation in Ar-
cally encourages private investors to partici-
gentine airlines since the end of the war.
pate in the aircraft manufacturing industry,
Non-scheduled operators are definitely dis-
virtually all of this function is actually per-
couraged and permits are issued only when the
services to be performed are of such a nature
formed by the State. Argentina's announced
that they cannot be conducted by the sched-
objective is to build a self-sufficient aircraft
uled carriers.
manufacturing industry by 1951. It will be
Direct government control over airline oper-
many years, however, before Argentina can
ations has effectively prevented competition
approach this goal. In the meantime, all
within the country. Prior to nationalization
transport aircraft must be purchased abroad.
SECRET
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