Washington has warned it may restrict flights from Cathay Pacific, in retaliation against Hong Kong’s new quarantine rules for aircrews, which it says are unfair to U.S. airlines.

The Department of Transportation on Tuesday demanded that Cathay Pacific submit details of all its flights to the U.S. within seven days. The department said it would determine whether they might “be contrary to applicable law or adversely affect the public interest.”

Under the new rules, all aircrew arriving in Hong Kong must be quarantined for 14 days and enter medical observation for a further seven days, but cargo-only flights to and from Anchorage in a closed loop were exempted. Cathay Pacific operates a large cargo operation in the Alaskan city.

FedEx’s Hong Kong-based crews only serve intra-Asia routings, and therefore do not benefit from the Anchorage exception.

The department said it wrote twice to its Hong Kong counterpart on Jan. 28 and Feb. 26, with the second letter warning of regulatory action to maintain fair competition. Hong Kong government officials also failed to provide a satisfactory explanation of the Anchorage exemption at a meeting with the U.S. consulate on Feb. 5, it said.

FedEx was forced to temporarily relocate around 180 Hong Kong-based pilots to San Francisco at significant expense. A FedEx spokesperson told Reuters that it hoped the order would aid in resolving the matter, adding it was working with U.S. and Hong Kong authorities and the Air Line Pilots Association to address Hong Kong’s requirements.

The Hong Kong government said the accusations were baseless. It said the Anchorage exemption was made after careful consideration, and was applicable to all airlines operating in Hong Kong with local crew.

The Hong Kong government will continue its discussions with FedEx to explore different options, it said.

Cathay Pacific said it would follow regulations in Hong Kong and regions that it flies to. The airline said it believed the interest of the public and travelers would be served best if the matter was resolved as soon as possible.

Cargo and passenger loads in February fell on average 60% and 25%, respectively, compared with January, it said. Cargo flights between Hong Kong and the U.S. were cut to between 21 and 28 per week from 35 to 39 per week.

The carrier is also incurring an extra cost of up to HK$400 million (US$51.5 million) per month, seeing it burn between HK$1.3 billion and HK$1.9 billion each month. Cathay’s capital will be exhausted in around 18 months at this rate.

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