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Following is the translation of the speech by the Secretary for Economic Development and Labour, Mr Stephen Ip, in resuming the second reading debate of the Civil Aviation (Amendment) Bill 2005 at the Legislative Council meeting today (January 11):
Madam President,
First, I would like to thank the Hon Ronny Tong who speaks on behalf of the chairman of the Bills Committee, the Hon Margaret Ng. My thanks also go to the Hon Wong Ting-kwong and the Hon Howard Young for their support.
It is common practice that airlines acquire aircraft through leasing arrangements with financiers. The financiers are the legal owners of the aircraft, but they have no management or operational control over the aircraft. In Hong Kong, the Civil Aviation Ordinance imposes strict liability on aircraft owners for loss or damage caused to third parties, regardless of whether they manage the aircraft. However, in many other jurisdictions with a developed aviation industry, owners not involved in the operation or management of aircraft are relieved of the third-party liability.
To follow international practice, the Bill seeks to exempt aircraft owners not involved in aircraft management from the strict liability. Specifically, an owner will be exempted if he has leased out the aircraft without crew for a period extending 14 days and assumes no management of the aircraft.
The amendment proposal would relief financial institutions of any unnecessary risks or liabilities and present a much more favourable environment for aircraft financing business in Hong Kong. This would enable Hong Kong airlines to acquire aircraft under more favourable terms, thus enhancing the competitiveness of our aviation industry. The legal protection to the general public would not be undermined after the amendment as the owners involved in the management of aircraft and the operating airlines would still be subject to the third-party strict liability.
The Bills Committee supports the policy intent of the Bill. When studying the Bill, the Committee conducted in-depth and careful deliberation on the detailed provisions. In particular, the Committee has given useful views and suggestions regarding the definition of "aircraft management", how to clarify the exemption criteria to better protect third parties, etc. In response to the Committee's concerns and after consulting the aviation and financial industries, we propose to further improve the drafting of the Bill, so as to provide clearer parameters for the interpretation of "aircraft management" and to provide more specific exemption criteria. These refinements have the support of the Committee and the industries. Later on I would propose the relevant Committee Stage amendments.
Madam President, I would like to take the opportunity to thank the Chairman of the Bills Committee, the Hon Margaret Ng, and Members of the Committee, the Hon Chan Kam-lam, the Hon Sin Chung-kai, the Hon Ronny Tong, the Hon Jeffrey Lam and the Hon Howard Young for their valuable time, efforts and advice.
Madam President, the Bill would facilitate the development of Hong Kong's aviation industry. It would also help maintain our status as an international aviation centre. I therefore strongly recommend that Members pass the Bill.
Ends/Wednesday, January 11, 2006
Issued at HKT 16:08
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