As a by-product of World War II (and a head start from international routes it had already established in the 1930's) the U.S. by default dominated international civil aviation in the early postwar years. It consolidated its position through the 1944 Chicago Convention, which established the International Civil Aviation Organization (ICAO) and set up a worldwide system which included a "Fifth Freedom" right to pick up and carry traffic from intermediate foreign destinations to other foreign points. It consolidated this right with bilateral agreements binding individual countries, as in the 1952 agreement with Japan.

The 1952 agreement was unequal in the sense that it was concluded just after the end of the Allied (essentially U.S.) military occupation in 1951, when Japan was still prostrate and dependent on U.S. largess and without any prospect of developing an international air tranport industry of its own.

Over the decades the U.S. has fairly successful slowed the inevitable expansion of international air services by other countries by resisting foreign demands for revision of the bilateral agreements. The chief bargaining tool for the U.S. has been the possibility of refusing or limiting landing and traffic rights in the U.S. But this strategy is now about played out. There are no longer any scheduled U.S. round-the-world air services such as the former PanAm route. The U.S.-Japan bilateral is one of the last substantially unrevised agreements.

Japan's apparent strategy of violating the 1952 agreement (by denying FedEx onward traffic rights to the Philippines) while requesting renegotiation of the agreement seems to me to surrender the legal and moral high ground which Japan gained during the recent automobile dispute. In my opinion, Japan should build on its newly enhanced reputation for probity by following the rules, however painful and unfair.

Japan has some effective legitimate recourses.

Compusory arbitration can be invoked by either side under Article 15 of the 1952 agreement. If Japan thinks it can make a good case (as in referring the automobile dispute to the World Trade Organization), this might be the easiest route to take.

Furthermore, Article 18 of the agreement permits either side to abrogate the entire agreement outright on one year's notice. Air services between the U.S. and Japan could continue informally without any agreement to the extent that each side unilaterally permitted. Since the U.S. now provides the most service between the two countries, it could be expected to permit some service by Japanese airlines in the expectation of tacit reciprocity. In a worst case scenario alternative routes using Canadian and Korean and airports and airlines could handle some U.S./Japan traffic.

The best resolution of all might be an entirely new bilateral understanding inspired the models offered by the recent U.S./Canada and U.S./Netherlands arrangements, whereby either side can serve almost without restriction any points in the other's territory (and even buy into each other's airlines). The U.S. might find this attractive because it would remove limitations on the frequency and capacity of U.S. flights serving Japan, while Japanese airlines would gain access to all of the many U.S. traffic points. The ultimate goal could be a global system of free access and ownership everywhere for all airlines, subject only to technical and safety requirements. It would be most commendable if Japan assumed leadership in this.

Incidentally, Ms. Ichiko Morita , Director of the Japan Documentation Center (JDC) of the Library of Congress, kindly faxed me a copy of the 1952 agreement in immediate response to my E-mail request for help in finding a copy. The JDC is a valuable resource for research!