US, Hong Kong finalize series of air agreements

The US and Hong Kong agreed early Saturday to give one another's airlines more rights to fly in and out of each place -- including a code-share arrangement for Cathay Pacific Airways and American Airlines.

The deal, which was several years in the making, will eliminate restrictions on the US cities that can be served by Cathay, Hong Kong's de facto carrier, while giving US airlines -- both passenger carriers and cargo companies -- more rights to fly into Hong Kong and then onto other points.

It clears the way for more intense competition over the Pacific between the world's two biggest carriers -- US rivals American and United Airlines.

United has by far a bigger presence in the region.

The package falls short of the so-called "open skies" pacts the US has reached elsewhere, but it ``will dramatically expand opportunities for the airlines of both sides and provide important benefits for consumers, shippers and communities,'' said Susan Stevenson, a US consular spokeswoman here.

Hong Kong had indicated from the start it would not go along with an "open skies" deal pushed by Washington. Critics call such arrangements unfairly tilted toward US airline interests.

Cathay long sought to put its own flight numbers on services offered in the US by its alliance partner American -- a practice known in the industry as code-sharing.

The two have previously cooperated more loosely, for example by allowing one another's frequent fliers to get and spend miles on both airlines as part of the global oneworld alliance with other carriers including British Airways and Australia's Qantas.

The deal will allow Cathay to sell seats on American flights into US cities beyond Cathay's international gateways such as San Francisco, Los Angeles and New York -- services it cannot operate with its own jets and crews because of US regulations.

"It's an extremely positive development for travelers between the United States and Hong Kong and Asia," said Al Becker, a spokesman for American at its headquarters in Fort Worth, Texas.