IATA history: who runs international aviation and what Cuba has to do with it
I was in Havana and walked into Hotel Nacional de Cuba – the famous hilltop hotel above the Malecón, best known for the mob conference that Meyer Lansky and Lucky Luciano hosted there in December 1946. In the corridor leading to the Comedor de Aguiar dining hall, I noticed a bronze plaque and a framed photograph on the wall. The plaque was installed by IATA itself in 1995, to mark the organization’s 50th anniversary.
The text on the plaque reads: “On April 19, 1945, at the Hotel Nacional, Havana, Cuba, the International Air Transport Association – IATA – was founded.”
Here’s what struck me: the official iata.org/about/history page says “founded in Havana, Cuba,” but never names the hotel. Anniversary press releases don’t mention it either. The bronze plaque in the Comedor de Aguiar is one of the few places where IATA itself records the exact location of its birth. And when you start looking into why the organization goes quiet about this on its public-facing pages, the story that emerges is considerably more interesting than the official version.
Why IATA was needed in the first place
By the end of World War II it was clear that international aviation would grow fast and needed common rules. In November-December 1944, a major intergovernmental conference in Chicago brought 52 countries together to sign the Chicago Convention. That created ICAO – a government-level body responsible for technical standards, flight safety, and the principles of airspace sovereignty.
But Chicago left one large problem unsolved: economics. Who sets fares between countries? How do airlines divide up routes? What share does each carrier get on London-New York? The Americans in Chicago pushed for full freedom – fly where you want, charge what you like. The British and Australians wanted strict capacity quotas and fixed prices. No agreement was reached. The Chicago Convention sidestepped the issue entirely.
IATA was created specifically to fill that gap – not at the government level, but among the airlines themselves. In short, the goal was this: bring all the major international carriers into a single association so they could agree on fares, schedules, and conditions of carriage among themselves, without competing on price. In the legal language of the 2020s, that’s a cartel. In the language of 1945, it was called “market stabilization.”
A cartel is an agreement between competitors not to compete on price or terms. In most industries, cartels are prohibited by antitrust law. But in postwar aviation, IATA’s tariff conferences received a special antitrust exemption – first in the US (the Civil Aeronautics Board approved them in 1945, permanently from 1955), then in most European countries. That exemption held until 2006, when the US Department of Justice finally revoked it.
Where it happened – Hotel Nacional and the Comedor de Aguiar
Hotel Nacional de Cuba opened on December 30, 1930. It was designed by the New York firm McKim, Mead & White – the same office that built Penn Station and the Boston Public Library. The money came from National City Bank of New York (now Citibank), and the hotel was managed by the team behind New York’s Plaza Hotel. Formally a Cuban hotel, but in terms of capital and management – an American asset on Cuban soil.
At the time of the April 1945 conference, the hotel was run by Kirkeby Hotels Corporation, the Chicago developer Arnold Kirkeby’s company. That detail matters: Gus Russo’s book Supermob (Bloomsbury, 2006) documents in detail that Kirkeby’s company had ties to organized crime – his flagship Drake Hotel in Chicago is described in sources as “part of a consortium controlled by Meyer Lansky.” Kirkeby himself never gave public testimony and was never charged, but his name appears regularly alongside figures from the Chicago syndicate.
This doesn’t mean IATA was founded by the mob. It means the hotel where it was founded was, in April 1945, part of the American business infrastructure in Cuba – and that infrastructure had its own particular character.
The inner courtyard of Hotel Nacional features a Spanish-style arched gallery. Delegates from 41 airlines representing 31 countries walked these corridors in April 1945. The Comedor de Aguiar – where IATA’s constitution was signed – is the hotel’s main formal dining room. It was named after Don Luis José de Aguiar, a Cuban civic magistrate who distinguished himself during the British siege of Havana in 1762. The room was almost certainly chosen for practical reasons: it was the only space of the right size and prestige.
Who organized it and who was in the room
The framed photograph names five people. Each has their own biography and their own role at that meeting. Here’s who they were.
John Cobb Cooper Jr. (1887-1967)
The most powerful person in the room. Cooper served as Vice President of Pan American Airways from 1934 to 1945 and sat on its board of directors. At the same time, he was an advisor to the US delegation at the 1944 Chicago Conference that established ICAO, and a member of IATA’s first executive committee in 1945. From 1946 until his death in 1967, he served as IATA’s legal counsel. IATA’s legal architecture – its constitution, tariff conferences, and price-coordination mechanism – was his personal work.
By 1945, Pan American Airways was the largest US airline, dominated transatlantic routes, and held major stakes in Cubana de Aviación, Mexicana de Aviación, and a dozen other Latin American carriers. It ceased operations in 1991 following a series of financial crises in the 1980s.
In 1947, Cooper published a book called The Right to Fly. A reviewer in the University of Chicago Law Review was direct:
— University of Chicago Law Review, 1948
In modern terms: the man who designed the industry’s rules was simultaneously a senior executive at the industry’s dominant company. In regulatory theory, this is called regulatory capture.
Colonel Chapa (1890-1972)
Coronel Pedro A. Chapa Quiroga was a Mexican military aviator from the Revolution era. In 1944-1945 he led Mexico’s delegation to three consecutive key aviation conferences: Chicago (founding of ICAO), Havana (founding of IATA), and Montreal (IATA’s first annual session).
In Havana he represented Compañía Mexicana de Aviación – at the time Latin America’s largest airline. Until 1944, Mexicana was 100% owned by Pan American. In 1944, a Mexican consortium led by Aarón Sáenz bought a stake, reducing Pan Am’s share to 55%. So Mexicana was nominally Mexican, but still effectively in Pan Am’s orbit. Chapa represented it in Havana. Mexicana no longer operates – it ceased flights in 2010.
Cuban sources don’t record him simply because he wasn’t Cuban. He died in Cuernavaca in 1972.
Dr. Gustavo Cuervo Rubio (1890-1978)
A Cuban gynecologist from Pinar del Río, and a politician. From 1940 to 1944 he was Cuba’s Vice President under Batista. From October 1944 he served as Foreign Minister in the Grau government – Batista’s political rival. In the photograph he is receiving the delegates on behalf of the government.
Cuervo Rubio made no substantive decisions at this meeting. The IATA constitution had been drafted in the six months before Havana – in Washington and Chicago, by Pan American’s lawyers under Cooper and by Machado’s Cuban team. By April 1945 everything was finalized; the delegates in Havana were there to sign. The Foreign Minister was present because protocol requires it – when a president receives a foreign delegation, the Foreign Ministry stands alongside.
President Ramón Grau San Martín (1881-1969)
He governed Cuba from October 1944 to October 1948. A reformist populist who had earlier taught physiology at the University of Havana. In the photograph he is addressing the delegates – the formal host of the country where the conference was held.
The Grau government is cited in Latin American history textbooks as a case study in state-level corruption. His Education Minister, José Manuel Alemán, used a structure called BAGA (Bloque Alemán de la Generación del Aire) to siphon earmarked funds meant for schools and teachers’ salaries. The money went toward buying real estate in Miami, aircraft, and a baseball team – the Miami Sun Sox, which Alemán purchased in 1949. By his death in 1950, his personal fortune in Miami was estimated at $60-100 million in the money of the time – roughly $1 billion today. The money was literally carried out of the Cuban treasury.
No direct evidence has been found that Grau personally received anything from IATA or from Pan American. But the broader context speaks for itself: IATA’s constitution was signed in a country whose ministers would, within a few years, be openly wheeling cash to Miami.
Luis Machado y Ortega (1899-1979)
A Cuban lawyer who in 1923 published Legislación Internacional del Aire – Cuba’s first treatise on international air law. Machado was director of Expreso Aéreo Interamericano, a Cuban cargo airline that was among IATA’s founding members. So the man who drafted the international association’s constitution was simultaneously running one of the member companies of that same association. Expreso Aéreo no longer exists.
It was Machado who, in December 1944, at a drafting session at the Carlton Hotel in Washington, invited colleagues to hold the IATA founding meeting in Havana. He also chaired the constitutional commission – meaning the entire final text was prepared under his leadership.
His subsequent career shows how aviation business and the major international financial bureaucracy operate across and above any particular political regime. In 1946 he was appointed Cuba’s Executive Director at the World Bank. In 1950, President Prío sent him to Washington as Cuba’s ambassador to the United States. In April 1952, Batista overthrew Prío, and Machado left the ambassador post – but didn’t leave Washington. The World Bank immediately hired him formally “for work on special Latin American issues” – meaning he now worked not for Cuba, but for the bank itself as a regional specialist. In 1954 he was reconfirmed as Executive Director, this time representing the Batista government, which by then had received official US recognition.
On January 1, 1959, Castro entered Havana. Batista fled. The new Castro government didn’t recall the bureaucrat Machado in Washington – the revolutionaries were busy inside Cuba and hadn’t yet got around to overseas posts. In 1960, Castro nationalized American oil companies, banks, and sugar mills; the US responded with an embargo. By November 1960, Cuba had effectively left the World Bank – it stopped paying dues and lost its voting rights. Machado no longer formally represented Cuba after that – but he stayed at the bank. Exactly how his status was structured over the following decade isn’t clearly described in open sources: some references still call him Cuba’s “representative” by inertia, others describe him as a staff member. Most likely he worked as a technical specialist on Latin America within one of the other Latin American constituency groups that make up the bank’s board.
In 1961, Cuba and the United States severed diplomatic relations. In 1962, the Cuban Missile Crisis. Through all of this, Machado kept going to his office at the bank in Washington. He retired only in 1970, at age 71, after 16 consecutive years as a director. After retirement he stayed on as a consultant – for the International Finance Corporation (the World Bank’s investment arm) and the Honduran embassy in Washington. He died in 1979 in Bethesda, a Washington suburb. He never returned to Cuba.
Two international organizations in 24 hours – IATA and ICAO
The speed with which Cuba signed aviation documents that week says a lot. The day after IATA’s constitution – on April 20, 1945 – Cuervo Rubio put his signature to the Chicago Convention on International Civil Aviation as well, the founding document of ICAO. So within 24 hours, Cuba’s Foreign Minister signed the founding documents of two international aviation bodies. First IATA – the airlines’ own cartel, setting fares and dividing up routes. Then the Chicago Convention – the future ICAO, the intergovernmental body meant to regulate those same airlines on behalf of states. In other words, on the same day the state signed a document giving airlines the right to set their own prices, and then signed another document promising to regulate them for doing exactly that.
Both organizations have been based in the same city since 1945 – Montreal. ICAO is at 999 University Street; IATA is at 800 Place Victoria. A ten-minute walk between them. In other industries, this would be called a conflict of interest. In aviation, it’s called “industry cooperation.” Cuba effectively ratified the founding documents of two organizations regulating the same industry within 24 hours – one governmental (ICAO), one corporate (IATA). The state officially handed tariff-setting authority to the very airlines that were paying into the system.
41 airlines from 31 countries
The numbers are disputed: IATA itself says “57 founding members,” while ICAO’s own chronicle clarifies that 41 airlines from 31 countries were physically represented in the room, with the rest joining during 1945.
| Region | Founding airlines | Geopolitical significance |
|---|---|---|
| US + Pan Am network | Pan American, TWA, American, United, Eastern, Northwest, Braniff + Pan Am’s Latin American subsidiaries (Panair do Brasil, LACSA, Panagra) | Coordinated dominance, roughly 12 votes |
| British Commonwealth | BOAC (now British Airways), Trans-Canada Air Lines (Air Canada), Qantas, South African Airways, Tasman Empire Airways | Institutional counterweight to the US |
| Liberated Western Europe | KLM, Sabena, Air France, Czechoslovak CSA | The future European flag carrier network |
| Authoritarian neutrals | Iberia (Franco’s Spain), Aero Portuguesa (Salazar’s Portugal), Swissair, Aer Lingus | Included without issue – politics kept separate from business |
| Latin America | Cubana de Aviación, Mexicana, Avianca, Varig, Cruzeiro do Sul, LAN-Chile (now LATAM) | Host country + pro-American bloc |
| USSR and Eastern Europe | Absent | Self-exclusion; the Cold War in aviation began here |
| Axis powers | Absent | Germany, Japan, Italy – disqualified as defeated nations in World War II |
The most politically loaded absence was Aeroflot. The USSR had walked out of the Chicago Conference in November 1944, publicly citing the presence of Spain, Portugal, and Switzerland – countries it described as having “pursued a hostile policy toward the Soviet Union.” Aeroflot would not become a full IATA member until 1989, under Gorbachev – 44 years after Havana. A perfect Cold War timeline, starting before the Cold War was even formally declared.
Lufthansa was not among the founders, though it’s often mistakenly cited as one. The German carrier was dissolved in 1945 and only reconstituted in 1953. Japan Airlines didn’t exist at all in 1945.
The complete list of IATA member airlines at the time of founding is only available as an archival image on the IATA website.
The Bermuda Agreement – legalizing the cartel
A cartel only works when a state gives it legitimacy. That legitimacy came. Ten months after Havana, from January 15 to February 11, 1946, the United States and Great Britain held talks in Bermuda on postwar air transport. The resulting document – Bermuda I – became the template for the entire global air transport system for decades.
Annex II §(b) of the agreement contains an explicit line: “Civil Aeronautics Board of the United States having announced its intention to approve the rate conference machinery of the International Air Transport Association…” In plain language: the American aviation regulator announced in advance that it would approve IATA’s internal fare-coordination mechanism. The governments officially permitted the airlines to agree on prices among themselves.
A few days later, on February 12, 1946, Britain’s Minister of Civil Aviation, Lord Winster, told the House of Lords directly: IATA was recognized “as a rate-fixing body acting through their various route conferences” – a body for setting tariffs through route conferences. From that point on, price coordination stopped being merely an internal arrangement among carriers and became a legally sanctioned part of the international aviation system.
The sequence is clear: first, the industry founded a structure in Havana with an explicit mandate to set fares. Ten months later, the US and British governments recognized that structure in an intergovernmental treaty. The CAB in the US granted IATA’s tariff conferences antitrust immunity – initially for one year, then permanently from 1955. Within a few years, most European countries followed suit.
The antitrust immunity for IATA’s tariff conferences was revoked by the US Department of Justice only in 2006 – 60 years after Bermuda. Until that point, IATA member airlines had a legal right to meet and agree on identical prices for international routes. Europe followed a similar process, with a few years’ lag. After the immunity was lifted, IATA continued to exist, but its role shifted – today it functions as a technical and standards body, not a pricing cartel. But the three letters IATA on your ticket are a direct inheritance from 1945 and Havana.
What happened to the airlines whose representatives founded IATA
IATA codes – the two-letter airline identifiers – are assigned by IATA itself. When an airline shuts down, its code is eventually freed up and can be reassigned to a new carrier, often from a completely different country with an entirely different business. The code that once flew on Pan Am’s Boeing 314 Clipper across the Atlantic in 1939 now appears on an economy-class ticket from Karachi to Dubai.
Of the four airlines represented at the table in Hotel Nacional on April 19, 1945, only one survives in its original form today. Here’s what happened to the others:
| Code | In 1945 | Today | What happened |
|---|---|---|---|
| PA | Pan American Airways (USA) | airblue (Pakistan, low-cost) | Pan Am went bankrupt in 1991. The code was freed up and reassigned to a Pakistani carrier |
| MX | Compañía Mexicana de Aviación (Mexico) | Breeze Airways (USA, low-cost) | Mexicana ceased operations in 2010. Since 2021 the code belongs to David Neeleman’s US carrier, the founder of JetBlue |
| CU | Cubana de Aviación (Cuba) | Cubana de Aviación (Cuba) | The same airline, operating continuously since 1929. The only founding member from this group to retain its identity |
| — | Expreso Aéreo Interamericano (Cuba) | No longer exists | The Cuban cargo airline through which Machado organized the conference itself. Ceased operations before the Cuban Revolution; its IATA code has lapsed |
IATA’s logic is straightforward – a code is a technical identifier for billing and reservations, not a historical monument. If a company doesn’t pay its membership dues for three consecutive years, IATA frees up the code and eventually issues it to the next applicant. There are no exceptions for historically significant carriers.
Looking at the five people in Hotel Nacional as a whole: three of the four airlines at the table were, in one way or another, owned by Pan American Airways. Cuervo Rubio and Grau signed the documents on behalf of the host country. This doesn’t look much like an “international technical association,” which is how IATA describes itself today. It looks more like Pan American Airways making an agreement with itself, with three subsidiary structures in attendance and the Cuban government acting as a notary. And the final irony: of this group, only Cubana de Aviación remains as a direct institutional heir of IATA’s founders. Pan American, which gave the industry the entire concept of IATA, didn’t survive to see its 50th anniversary.
Why IATA stays quiet about Hotel Nacional
Back to the puzzle I started with. IATA knows it was founded in Hotel Nacional – the 1995 bronze plaque documents that. So why does iata.org/en/about/history/ simply say “founded in Havana, Cuba,” with the hotel name absent from directors-general speeches and anniversary press releases alike?
The explanation, in my assessment, has several layers. Since September 28, 2020, Hotel Nacional has appeared on the US State Department’s Cuba Prohibited Accommodations List, which legally bars “persons subject to US jurisdiction” from staying there or paying for services. IATA is headquartered in Montreal, but its largest members – American, Delta, United – are American companies. An anniversary dinner of the kind that then-IATA Director General Tony Tyler held at the memorial plaque in 2015 would today be legally problematic for American participants.
On top of that: the hotel was nationalized by Castro in June 1960 (taken from InterContinental Hotels – a Pan Am subsidiary that had by then bought the building from Kirkeby), and in December 1946 it hosted the mob’s Havana Conference, immortalized in The Godfather Part II. The combination of those associations – US sanctions, the Cuban Revolution, organized crime – makes a direct reference to the building reputationally awkward for a trade association that primarily represents American corporations.
The Cuban side maintains a mirror silence for the opposite reasons. The Cuban encyclopedia ECURED incorrectly dates the event to “October 1945.” No anniversary coverage of IATA’s 50th, 75th, or 80th year has appeared in the state newspaper Granma. Revolutionary historiography has no interest in celebrating a technocratic-capitalist creation whose guests included a future World Bank official and a former vice president under Batista.
The silence here is a deliberate position on both sides. The bronze plaque in the Comedor de Aguiar remains one of the few places where the exact location of that founding moment is recorded.
What this story actually means
Taken together, the facts add up to a picture that fits neither IATA’s official narrative nor Cuba’s. IATA was not born as a neutral technical association – it was a carefully engineered industry cartel, a product of Western capitalism in the final weeks of World War II.
Its legal architecture was written by Cooper – simultaneously Pan Am’s Vice President and IATA’s lifelong counsel. The first president was Canadian (a compromise between the US and Britain). The first Director General was a British civil servant who had previously headed UK civil aviation and led the Bermuda negotiations. The host country provided Batista’s former Vice President as Foreign Minister, and a reformist president whose government was looting the treasury. The host airline was a Pan Am subsidiary. The host hotel was owned by a Chicago developer with documented ties to Lansky. The USSR and the Axis powers were absent.
Ten months later, the Bermuda Agreement legalized the cartel’s tariff conferences. Antitrust immunity wasn’t revoked until 2006 – 60 years later.
This is not a conspiracy theory. It’s documented postwar aviation history, traceable through primary sources, academic work on antitrust regulation (Louis Schwartz, 1954; John Hannigan, 1982), and investigative literature (Gus Russo, Supermob, 2006). Each individual element is on the record. But together they form a story in which American corporate aviation, Cuba’s pro-American elite, a Chicago hotel syndicate, and a Princeton legal school jointly constructed a structure that governed global air transport for the next sixty years.
Hotel Nacional today
The hotel is open, and anyone can walk in to see the plaques and the framed photograph – the Comedor de Aguiar is freely accessible, no need to be a hotel guest. Address: Calle 21 esquina O, Vedado, Havana. The room is in the main building, on the side facing the seafront. The easiest approach is to ask the concierge in the lobby where the Comedor de Aguiar is; the staff know exactly where to direct you.
The hotel also has a Hall of Fame with photographs of notable guests over the years – from Winston Churchill and Ernest Hemingway to Errol Flynn and Ava Gardner. The December 1946 mob conference is represented there too – unlike the IATA story, that one is commercially useful to the hotel’s legend.
Hotel Nacional has been on the US State Department’s Cuba Prohibited Accommodations List since September 28, 2020. For American citizens, this means staying at the hotel or paying for its services is prohibited. But physically visiting as a tourist – walking in, going through to the Comedor de Aguiar, looking at the plaques – falls outside those restrictions.
FAQ
April 19, 1945, at Hotel Nacional de Cuba in Havana, in the Comedor de Aguiar dining hall. The founding conference ran from April 16 to 19. Legal incorporation took place in Canada in December 1945 – through a special act of the Canadian Parliament – and the headquarters have been in Montreal ever since.
Herbert James Symington, president of Trans-Canada Air Lines (now Air Canada). A Canadian in the chair was a compromise between the US and Britain – the two countries that effectively determined the postwar architecture of aviation.
The numbers vary. IATA itself says “57 founding members from 31 countries.” ICAO records that 41 airlines from 31 countries were physically present in Havana, with another 16 joining during 1945. Lufthansa was not among them – it was dissolved in 1945 and only reconstituted in 1953. Aeroflot was also absent and didn’t join until 1989.
Yes. The Comedor de Aguiar in Hotel Nacional de Cuba is open to visitors. You don’t need to be a hotel guest. Ask the concierge in the lobby – the staff know where to point you. On the wall of the room hangs the IATA bronze memorial plaque from 1995, along with a framed photograph from April 19, 1945.
Not directly. In April 1945, Lucky Luciano was in a New York state prison, and Meyer Lansky was temporarily away from Cuba. The famous mob Havana Conference at Hotel Nacional came 20 months later, in December 1946. However, Kirkeby Hotels Corporation, which ran the hotel in April 1945, had documented ties to organized crime in the US – that’s context for the era, not direct involvement in IATA’s founding.
Yes, officially. IATA’s tariff conferences held antitrust immunity in the US (granted by the Civil Aeronautics Board in 1945, made permanent from 1955) and equivalent immunities in most European countries. Member airlines had a legal right to meet and agree on identical prices for international routes. That immunity remained in force until 2006, when the US Department of Justice revoked it. Sociologist John Hannigan explicitly described IATA in 1982 as “the world aviation cartel.”
Sources
This piece draws on the following primary and academic sources:
- IATA official history page: iata.org/en/about/history
- Postal History of ICAO – detailed chronicle of IATA’s founding: icao.int/sites/default/files/postalhistory/iata_international_air_transport_association.htm
- Washington Post obituary for Luis Machado (February 10, 1979)
- Wikipedia: John Cobb Cooper – Princeton University archives (UPENN_BIDDLE_PU-L.MSS.018)
- US State Department Bureau of International Information Programs – text of the Bermuda Agreement, 1946
- Hansard, House of Lords proceedings, February 12, 1946 – Lord Winster’s speech
- Gus Russo, Supermob (Bloomsbury, 2006) – history of Kirkeby Hotels and organized crime connections
- S. Ehrlich, “Ramón Grau San Martín: Cuba’s Prophet of Disappointment, 1944-1951,” ASCE Cuba Database
- Louis B. Schwartz, 1954 academic paper on the antitrust immunity of IATA tariff conferences
- John Hannigan, “International Air Transport Association as a World Aviation Cartel,” 1982
- Cuba Prohibited Accommodations List – 31 CFR 515.210, OFAC Treasury Department
- Aviation Week, photo report on Tony Tyler’s visit to Hotel Nacional, November 25, 2015
- Author’s personal observation at Hotel Nacional de Cuba, December 2022
· Founder, Know.Travel, Havana