Bermuda Agreement - Bermuda I

Bermuda I

In 1946, delegates from the United States and the United Kingdom met at Hamilton, Bermuda, to resolve issues remaining from the 1944 Chicago meeting. The Chicago meeting which had involved some 52 countries had been unable to reach agreement on any but the most fundamental points at issue in post-war international civil air transport. It had agreed the first two Freedoms of civil air transport

First Freedom: The right to fly over the territory of another country. Second Freedom: The right to land for essential repairs, refuelling or to escape adverse weather conditions in another country.

The failure to agree more was largely due to the disagreements between the United States and Britain, then the two largest carriers of civilian traffic, internationally. At Bermuda the two countries agreed again on the two freedoms that had been accepted at Chicago, since that agreement was not yet in force, receiving its 26th ratification in time to operate from April 4, 1947. Britain also accepted the remaining three freedoms which had not been agreed at Chicago.

Third Freedom: The right to collect passengers or cargo in an airline's home country for flight to another country Fourth Freedom: The right to discharge passengers or cargo at another country's airport. Fifth freedom: The right to collect passengers or cargo at a location outside its home country and fly them to a point father on, also outside the airline's home country.

The United States also agreed that the International Air Transport Association, an international body, would set fares, subject to the two governments' approval. This bilateral agreement became the model for a series of future bilateral agreements between the United States and other countries. The British continued to pursue much more restrictive agreements based on traffic sharing with agreed fares, set by the two governments concerned.

During World War 2 the United States and Britain operated a regular flying boat service across the Atlantic. The US operator was Pan American Airlines Corporation and the British operator the newly formed and government owned British Overseas Airways Corporation. The US terminal was at Baltimore and the British at Poole, in Dorset south-west England. Intermediate refuelling stops were at Botwood in Newfoundland, then a British colony and Foynes on the river Shannon in the Irish Republic. Flight schedules were for about 32 hours but could be considerably longer on the westbound route if strong westerly winds prevailed on the North Atlantic or weather conditions or mechanical problems interfered with departures. Both airlines flew Boeing 314s. Passenger traffic was exclusively military or governmental and both Mrs Eleanor Roosevelt, wife of the president and Sir Winston Churchill prime minister were amongst the passengers.

It was clear to aviation planners in both countries that there would be considerable post-war development of civilian air traffic across the Atlantic. Rapid wartime development of civil aircraft especially landplanes such as the Douglas DC4 and DC6 the Boeing Stratocruiser and Lockheed Constellation meant that future routes between the two countries would use runways, many developed during the war as refuelling points for USAAF Boeing Fortresses on delivery runs to operational bases in England and North Africa. The new airliners could carry substantially greater payloads than the flying boats, allowing for both more passengers and greater fuel loads providing longer range. But no civil transport aircraft at that time could fly the Atlantic without refuelling.

The British controlled several useful airports necessary for the development of American civil air transport in the 1940s. The most important was Gander in Newfoundland, still a British colony, used until the dawn of the jet age by virtually all transatlantic flights. Bermuda as well as being a destination in its own right was also useful as a staging point as was Prestwick near Glasgow, in Scotland, which had good weather conditions. A new airport at Heathrow near London was under construction which would be useful as a hub for airline traffic through to Continental Europe and the Middle East. On the Pacific routes, Hong Kong occupied a similarly strategic position on the routes between the USA and China, then undergoing a civil war between Chiang Kai Shek's Nationalist government and the Communist insurgents of Mao Tse Tung.

The Bermuda meeting between the two wartime allies was arranged in order to facilitate the development of post-war air traffic across both the Atlantic and Pacific. There were no politicians present. It was simply a working meeting between British civil servants from the Ministry of Aviation and representatives of the State Department's Office of Transportation Policy. Both sides had a similar overall objective: to encourage the development of civil aviation internationally. But they differed greatly on how this should be done.

The American delegates were in favour of a very liberal regime under which several airlines could provide as much capacity as they wished on each designated route, charge what fares they considered commercially justified and operate with as little government interference as possible. The British were conscious that the US had a significant lead in the development of civil aircraft, that it already had a substantial internal air travel market and that its airlines dominated traffic within South America and between South and North America.

The British would have preferred a tightly regulated agreement as they later signed with Australia and New Zealand. This would limit the Atlantic routes to a single airline from each country operating similar frequencies at similar fares. Ideally they would have preferred an American airline to collaborate with the British carrier BOAC, sharing facilities and revenues. Such arrangements formed the basis of subsequent agreements established by the British with other countries. This view was also favoured by Pan American, then the US's chosen instrument for most international routes. However it was unacceptable to the State Department, which was well aware that unlike transatlantic sea traffic, then largely in the hands of the British line Cunard, American airlines were likely to win the largest share of the air traffic provided they were not unduly restricted by the agreement.

American Export Airlines, a subsidiary of an American shipping company and Trans World Airlines, which had been bought by Howard Hughes and had placed the first order for Lockheed Constellations were determined to join Pan American on the Atlantic, which held the promise of becoming the world's most lucrative international air route. Extensive lobbying of Congress by these airlines made it impossible for the American officials to concede to the narrow UK proposals.

The eventual agreement permitted each country to specify as many carriers as it wished on a series of designated routes. In the event the British restricted their allocation to BOAC whilst the Americans allowed three carriers to compete, Pan American, American Export and Trans World. Fares were to be agreed by an international body and there would be a procedure to investigate them if either country thought that they were too low to be commercially viable.

On the Atlantic routes, the designated US airports were Baltimore, the existing flying boat base, New York, Chicago, Detroit, Philadelphia, Washington and Boston.

The UK airports were London and Prestwick in Scotland, as well as intermediate stops on British colonial territory at Bermuda or Gander and certain other islands. Onward traffic was permitted to New Orleans and Jamaica and various specified points in Latin America. In the other direction it was permitted to continue to most major Continental European airports and also through British colonial territories in the Middle East and India as far as China. A New York-Bermuda route was also agreed, which the American delegation used when it left the conference in a landplane - a sign of things to come.

The Pacific terminals were San Francisco and Los Angeles in the US and the British colonies of Hong Kong and Singapore. This could be linked into a round the world service as Pan American subsequently did. Most Caribbean islands in British possession including Jamaica, Trinidad and the Bahamas were permitted as destinations from Miami and New York with some routes also from Houston, Palm Beach and New Orleans. Onward traffic was permitted to most of South America for airlines from both nations.

A further route through a variety of Atlantic islands was agreed to the British colonies of the Gold Coast (later Ghana) and Nigeria and onward to South Africa.

Members of both the United States Senate and the House of Lords criticised the negotiators. Both sides were concerned that the other country would exploit the agreement to take internal traffic for example from New York to New Orleans or in the British case from London to India. So a clause was inserted that permitted only as much traffic to be carried between intermediate points as was justified by spare space on the aircraft. It was specifically forbidden to introduce a larger aircraft on a segment such as New York-Mexico City or London-Paris. In the event little such traffic was attracted and the fears proved groundless. As was to be expected American airlines won the lion's share of the Atlantic route, over the next few years. But gradually BOAC also was able to build this into its most profitable route, largely by using American aircraft.

On May 31, 1946, Lockheed Constellations operated by Pan American Airways and American Overseas Airlines (the new name for American Export) landed within 20 minutes of each other at a storm-torn Heathrow from New York's La Guardia. Passengers disembarked through army tents, as the control tower was the only brick building on site, to be greeted by Averill Harriman the US ambassador. This inauspiocious beginning inaugurated what would soon become the most important international air route for both airlines.