Page 68 - Tourism The International Business

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1st Freedom A US airline bound US Mexico Brazil
for Brazil overflies Mexico.

2nd Freedom A US airline lands in US Mexico Brazil
Mexico for refueling

3rd Freedom A US airline carrying US Mexico Brazil
US citizens to be dropped off in
Mexico.

4th Freedom A US airline carrying US Mexico Brazil
visitors from Mexico into the US

5th Freedom A US airline destined US Mexico Brazil
for Brazil may stop to pick up
passengers in Mexico along its route.

6th Freedom A US airline carrying London Miami Brazil
British passengers from London
destined for Brazil may stopover in
Miami as a gateway to South American
destinations.

7th Freedom A US airline flies a US Tokyo Seoul
shuttle service between Tokyo and
Seoul.

8th Freedom A Japanese airline Japan Honolulu San Francisco
carries traffic between Honolulu and
San Francisco.

Exhibit 28: Examples of "Freedoms of the Air".
Bilateral agreements

A bilateral agreement refers to an agreement between two countries to offer airline service between them.
Bilateral agreements are intended to protect the rights of both countries in three areas: to allow carriers of both
nations to participate in the marketplace; to control the frequency of flights so that profitable load factors can be
generated; to control prices to prevent discount fares in prime markets. This latter practice is referred to as
predatory pricing. Many small nations felt they needed bilateral agreements to protect their national airline. A
national airline of a small country may be subsidized by the government. The airline may be operated because of

Tourism the International Business 68 A Global Text