3742 Provision of ade- quate capacity. Right to embark, etc. Ante, p. 3740. Consultation re- specting observance of principles. INTERNATIONAL AGREEMENTS OTHER THAN TREATIES [62 STAT. SECTION VII The services provided by a designated air carrier under the present Agree- ment and Annex shall retain as their primary objective the provision of capacity adequate to the traffic demands between the country of which such air carrier is a national and the country of ultimate destination of the traffic. The right to embark or disembark on such services international traffic destined for and coming from third countries at a point or points on the routes specified in the present Annex shall be applied in accordance with the general principles of orderly development to which both contracting parties subscribe and shall be subject to the general principle that capacity should be related: (a) to traffic requirements between the country of origin and the countries of destination; (b) to the requirements of through airline operations (trunk services); and (c) to the traffic requirements of the area through which the airline passes after taking account of local and regional services. SECTION VIII. In so far as the air carrier or carriers of one contracting party may be temporarily prevented through difficulties arising from the War from taking immediate advantage of the opportunity referred to in Section V above, the situation shall be reviewed between the contracting parties with the object of facilitating the necessary development, as soon as the air carrier or carriers of the first contracting party is or are in a position increasingly to make their proper contribution to the service. SECTION IX It is the intention of both contracting parties that there should be regular and frequent consultation between their respective aeronautical authorities and that there should thereby be close collaboration in the observance of the principles anl the implement ation of the provisions outtlined in the present Agreement and Annex. SECTION X (A) The determination of rates in accordance with the following paragraphs shall be made at reasonable levels, due regard being paid to all relevant factors, such as cost of operation, reasonable profit, and the rates charged by any other carriers, as well as the characteristics of each service. (B) The rates to be charged by the air carriers of either contracting party between points iu the territory of the United States and points in Italianterritory referred to in the attached Schedules shall, consistent with the provisions of the present Agreement and its Annex, be subject to the approval of the aeronautical authorities of the contracting parties, who shall act in accordance with their obligations under the present Annex, within the limits of their legal powers. Determination-'of rates. - mw:l .- Approval,
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