This paper would present an important issue at hand which is being faced by Australian Airlines and what policies would need to be recommended in order to overcome these issues. The problem is being addressed as outlined in the report titled “International Air Services”. At present, the Australian International Airline Service makes use of a bilateral agreement set-up with a number of countries given the status of an International Treaty Status. However, post-1996 certain recommendations were put forward in order to change this situation. A number of issues were considered as part of this review process which included the current regulatory/legislative framework such as the multilateral and bilateral structures. This would mean a direct reference to the commercial rights hence this review also sought out to identify the effect that these subsequent changes would have on the global competition. Another important point to be considered was that of the effect on Australia’s existing and potential international aviation markets with reference to the international agreements which it had its bilateral partners. Introduction At present, the International Air Services Commission was providing certain benefits to the Aviation industry and even these benefits were reviewed in order to verify their effectiveness. The costs/benefits approach used was a method of confirming the effectiveness of the overall industry and its efficiency. Different options were reviewed which had allowed the aviation industry more liberalized. After carrying out the comprehensive review outlined above, the commission was able to diagnose certain significant findings which varied from the system being ineffectual, its inability to meet the demands of the expanding system. It was especially seen that these very deficiencies in the system were resulting in major repercussions such as customer dissatisfaction and industry loss. The following excerpt from the report highlighted certain significant issues: “The global aviation industry has reached a critical point in its development. The inefficiencies imposed on the world aviation industry by the current bilateral system and the benefits of more efficient, internationally competitive air services are now apparent. Reciprocal ‘open skies’ agreements are spreading.” Inquiry Report (1998). Main Recommendations The Australian Government was outlined as a body that had not been to catch up with the chain of change and progress and hence, adding to the failures of the system. In order to improve the status quo, a Commission was set up in order to tackle the issue. As is the case with any Aviation industry, the need for a Commission was recognized for the purposes of monitoring and ensuring better service provision. The following section of the paper will outline those recommendations in brief detail. The solution provided by the Commission was one that included a policy of reciprocal open skies:   * Bilaterally   * Plurilateral   * Multilaterally For the Commission safety was a major concern and hence, one of its major conclusions was its emphasis on safety which could not be comprised under all possible circumstances. In order to ensure that t