Compass Airlines operated in Australia for two brief periods in the early 1990s. The two incarnations of the airline were quite separate with different management and aircraft. History Compass I was Australia's first low cost airline. It was established following deregulation of the Australian airline industry in 1990. Previously Ansett and the government-owned Australian Airlines had operated under the Two Airlines Policy, which was in fact a legal barrier to new entrants to the Australian aviation market. It restricted intercapital services to the two major domestic carriers. This anti-competitive arrangement ensured that they carried approximately the same number of passengers, charged the same fares and had similar fleet sizes and equipment. Compass Mark I Compass Airlines, later referred to as Compass Mark I was established by Bryan Grey, who had previously run regional airline East-West Airlines. East-West had earlier attempted to break the duopoly of Ansett and Australian Airlines by offering cheap fares but in the regulated environment of the time was not allowed to operate directly between major cities so was forced to detour via regional centres. East-West was ultimately acquired by Ansett. Compass commenced operating between Brisbane, Sydney, Melbourne and Perth on 1 December 1990. In July 1991 it commenced serving Adelaide. At its peak Compass Mark I operated four leased Airbus A300 (VH-YMA, VH-YMB, VH-YMJ, VH-YMK) and a single A310 aircraft (VH-YMI). Three further Airbus A300 aircraft on order in 1990 (VH-YMC, VH-YMD, VH-YME) were not taken up as a result of the failure of finance negotiations. Alternatively VH-YMJ and VH-YMK aircraft were leased from British charter carrier Monarch Airlines. Compass Mark I collapsed on 20 December 1991, with the reasons being portrayed as undercapitalisation, sustained fare discounting by its competitors and failing to make use of its potential to also carry freight. The Federal Government made it extremely difficult for the new airline to succeed, as evidenced by the lack of suitable facilities provided to Compass. In the major cities, the fledgling carrier was forced to accept what were the least accessible aircraft parking bays inside the terminal of one of their competitors, an impediment to successful trade also noted by the government's own Australian Competition & Consumer Commission study. Compass Airlines' initial operations were also significantly disrupted by what appeared to be a computer attack on their reservations system. As the official findings of the Australian Taxation Office detail, the federal government set in place