63 STAT.] SWITZERLAND-AIR TRANSPORT SERVICES-MAY 13, 1949 Annex shall retain as their primary objective the provision of capacity adequate to the traffic demands between the country of which such airline is a national and the country of ultimate destination of the traffic. The right to embark or disembark on such services interna- tional 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 to: (a) traffic requirements between the country of origin and the coun- tries of destination; (b) the requirements of through airline operation; and (c) the traffic requirements of the area through which the airline passes after taking account of local and regional services. SECTION VI It is the intention of both contracting parties that there should be regular and frequent consultation between their respective aero- nautical authorities and that there should thereby be close collabora- tion in the observance of the principles and the implementation of the provisions outlined in the present Agreement and Annex. SECTION VII 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 in the territory of the United States and points in Swiss territory referred to in the attached Schedule 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. It is recognized that the determination of rates to be charged by an airline of one contracting party over a segment of the specified route, which segment lies between the territories of the other con- tracting party and a third country, is a complex question the over-all solution of which cannot be sought through consultation between only the two contracting parties. Pending the acceptance by both con- tracting parties of any multilateral agreement or recommendations with respect to such rates, the rates to be charged by the designated airlines of the two contracting parties over the route segment involved shall be set in the first instance by agreement between such airlines operating over such route segment, subject to the approval of the aertnautical authorities of the two contracting parties. In case such designated airlines cannot reach agreement or in case the aeronautical 2441 Traffic from third countries. Consultation for col laboration. Rates. Pod, p. 2443 .
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