OST Filings for March 19, 2001

OST Docket Filings for March 19, 2001

Last Updated 03/22/01 11:31 AM

Applications and Renewals:

Arrow - Withdrawal of Uruguay | Delta/LAPA - U.S.- Argentina Codeshare

Answers and Replies:

Alaska Mail Rates - Comments | CRS - Comments | DHL Worldwide - Comments to UPS Stay | MNG - Answer to United (Turkey)

Notices of Action Taken:

Air Georgia

Notices and Orders:

EAS at Page, Arizona - Selecting Carrier and Setting Final Rates | IATA | U.S.- Argentina - Notice

Air Georgia Ltd.

OST-00-7012

Filed February 6, 2001
Issued March 19, 2001

Notice of Action Taken

U.S.- Canada

Exemption from 49 USC section 41301 to permit the applicant to continue to conduct, using small equipment scheduled, combination services between any point or points in Canada and any point or points in the United States; and 2) charter operations, carrying persons, property and mail, between Canada and the United States and other charters pursuant to 14 CFR Part 212.

By: Paul Gretch

Index

Arrow Air, Inc.

OST-96-1118	March 19, 2001	Withdrawal of Application	Miami, FL - Montevideo, Uruguay
		Service List

Counsel: Pierre Murphy, 202.872.1679, pmurphy@lopmurphy.com

Index

Delta Air Lines, Inc. and Lineas Aereas Privadas Argentinas, S.A.

OST-01-9196	March 19, 2001	Joint Application for Statement of Authorization and Exemption	U.S.- Argentina Codesharing
		Attachment: Codesharing Agreement
		Service List

A statement of authorization to Delta pursuant to 14 C.F.R. Part 212, authorizing Delta to display LAPA's "MJ" designator code on flights operated by Delta between Atlanta, Georgia, and Buenos Aires, Argentina; and between Atlanta, on the one hand, and Los Angeles, Miami, New York, and Orlando, on the other hand

An exemption to LAPA pursuant to 49 U.S.C. § 40109, authorizing LAPA to engage in scheduled foreign air transportation of persons, property, and mail, from points behind Argentina, via Argentina and intermediate points, to Los Angeles, Miami, New York, and Orlando, in both directions.

The Joint Applicants plan to commence codeshare services on or about April 1, 2001, and request that this application be granted by no later than March 26, 2001, to provide LAPA with adequate time to market its planned new services between the United States and Argentina. The Joint Applicants request that the statement of authorization be effective for an indefinite term, subject to the Department's standard codeshare conditions. LAPA requests that its exemption authority remain effective for a period of at least two years.

LAPA currently operates three weekly flights on the Buenos Aires-Atlanta route with its own aircraft. In order to provide service to additional U.S. points under the Joint Applicants' codesharing agreement, LAPA requires an exemption authorizing it to serve Los Angeles, Miami, New York and Orlando.

Counsel: Pierre Murphy, 202.872.1679, pmurphy@lopmurphy.com and Shaw Pittman, Robert Cohn, 202.663.8060

Index

Essential Air Service at Page, Arizona

Order 01-3-20 OST-97-2694 OST-97-2706 OST-97-2827	Issued March 16, 2001 Served March 21, 2001	Order Selecting Carrier and Setting Final Rates	Terminate Service at Ely, Nevada, Moab, Vernal and Cedar City, Utah and Page, Arizona
		Attachment: Map, Compensation Requirement

By: Susan McDermott

Index

Computer Reservations Systems (CRS) Regulations

OST-01-9054

March 19, 2001

Comments of America West Airlines

CRS Regulations

America West will shortly be filing a supplement response to the Department's July 24, 2000 Advance Notice of Proposed Rulernaking, focusing on the continuing need to regulate excessive booking fees. America West has already described in its earlier filings how CRS vendors have exploited their market power by ratcheting up fees while technology costs continue to decline, resulting in millions of dollars in monopoly profits at the expense of airlines and their passengers. Moreover, CRS booking charges have increased dramatically over the last several years as the vendors increase incentive discounts or give their systems to subscribers at no cost. In this connection, a recently released report by Global Aviation Associates found that in the year 2000, consumers and airlines paid an estimated $1.7 billion in booking fees to the CRS vendors. The study also found that "[CRS] profit margins are now triple those of the airline and travel agent industries." For America West the increase in CRS fees, adjusted for increases in passengers, for the five-year period 1992 through 1997 was 33% and slightly more than 15% during the two-year period from 1998 through 2000.

Given CRS vendor market power over participating carriers, America West supports the Department's tentative decision to extend the current CRS Regulations until March 31, 2002. Importantly, America West also strongly urges the Department to issue, as quickly as possible, an NPRM to implement the rules proposed in America West's Amended Petition. The escalating problem of excessive booking fees has been before the Department since 1997, and urgently needs to be addressed. These charges have a disproportionate impact on smaller, new entrant carriers and harms their ability to compete. Controlling booking fees is a step the Department can take that will enhance competition and protect consumers. As the Department looks for ways to promote competition it should turn its attention to the booking fee issue. This issue can and should be separated from the broader review of CRS/Internet issues and considered on an expedited schedule.

Counsel: Baker Hostetler, Joanne Young, 202.861.1532

OST-01-9054

March 19, 2001

Comments of Delta Air Lines

CRS Regulations

Delta supports the continuation of the present rules in order to give the Department time to complete its assessment and reevaluation of the CRS regulations. As noted by Delta at the last extension of the rules, and in Delta's supplemental comments last year, the proliferation of competitive price and service information via the Internet has empowered consumers and businesses with the ability to obtain such information independent of airlines or travel agents. This has resulted in a significant change in the traditional roles played by consumers, travel agents, CRS companies and airlines. In addition, the Department is considering how the CRS rules should apply to CRSs in light of reduced direct ownership ties with airlines.

Delta urges the Department to proceed as rapidly as possible with the issuance of a new set of rules which (1) avoid the pitfalls of unnecessary and harmful regulation of the Internet, and (2) more equitably harmonize the treatment of CRS carrier-owners and CRS carrier-marketers.

In the meantime, Delta agrees with the Department that the rules "do appear to address the most serious potential competitive and consumer protection issues created by the use of computer reservations systems in the airline industry."

Counsel: Shaw Pittman, Alexander Van der Bellen, 202.663.8060

OST-01-9054

March 19, 2001

Comments of Orbitz, L.L.C.

CRS Regulations

Orbitz has raised in the CRS rulemaking docket a number of concerns about the shortcomings of the CRS Rules with respect to their ability to adequately assure competition, and therefore the public interest, in the automated distribution of air travel through travel agents. These shortcomings work to the detriment of the traveling public, of airlines, of travel agents, and of competition itself. It is important that the Department thoroughly understand those complex issues and deal with them. The issues, however, are complex, with significant interaction between each part of the rules and the other parts.

The Department's goal in the review of the CRS Rules has been to ensure that the regulations protect consumers even while enhancing greater efficiency and competition in the distribution of travel services. The Department must, therefore, understand th e full range of CRS issues, and what needs to be done about the entire range of issues - recognizing that this may potentially include removing regulatory restrictions or enhancing regulatory restrictions depending on which course of action, in the judgment of the Department, is most likely to achieve the stated goals. If the Department requires additional time before it is prepared to make that kind of broad reassessment of the CRS Rules, it should take that time to do the job properly.

The Department should maintain in place the existing rules intended to protect consumers and competition, even while it considers how best to update them. The Department should continue its comprehensive review of how Part 255 should be modified such that it will achieve its intended purposes, while encouraging the potential of new technology and market forces to directly benefit consumers and competition.

Counsel: Zuckert Scoutt, Jol Silversmith, 202.298.8660

OST-01-9054

March 19, 2001

Comments of Worldspan, L.P.

CRS Regulations

Worldspan has no objection to the proposed extension. Given the issues raised by the Department in its Supplemental Advance Notice of Proposed Rulemaking in Docket Nos. OST-97-2881, OST-97-3014 and OST-98-4775, and the numerous comments received thereon, a thorough review of the complex and inter-related issues relating to the electronic distribution of air transportation services and the regulation thereof is an important and necessary task. The extension proposed in the NPRM is certainly warranted.

Worldspan remains concerned, however, that the Department may be contemplating action on certain issues before completion of the comprehensive reexamination of all of the relevant issues.

Counsel: Zuckert Scoutt, Charles Simpson, 202.298.8660

Index

Intra-Alaska Class Service Mail Rates

OST-95-405	March 19, 2001	Reply of Consolidated Carriers and Petition for Leave to File Late	Order to Show Cause Establishing Final Bush Service Mail Rates
		Service List

Overall, the Postal Service comments are very thoughtful and express many of the concerns of the Carriers. The proposals made by the Department are simply too complex to be adopted in an abbreviated procedure, and require extensive additional study. What is troubling is that attitude of the Postal Service toward its air carrier partners. It has no problem imposing burdensome new reporting requirements on the air carriers, or questioning every aspect of their operations, but is unwilling to even address its own impact on the cost of mail carriage. The Carriers appreciate the continuing dialogue with Postal officials, and believe a truly cooperative approach will be the best solution within the current ratemaking procedure.

What is puzzling is why such an extensive and detailed set of proposals has been raised, now for the second time, when there is little if any stated interest by the parties directly involved. Many superfluous and irrelevant topics have been raised as part of this process. For example, the Department used a letter from a single carrier complaining that the current mail rate and equitable tender procedures made it uneconomic for it to operate the type of aircraft the company desired as justification for making revisions in the rate adjustment method. It is the duty of the Department to recognize and measure the existing mail delivery costs, not to alter them to achieve some separate goal or regulatory philosophy. Both the Postal Service and Paul Bowers have supported this extra-legal activity through their Comments.

By: Hank Myers

Index

MNG Airlines Cargo, Inc.

OST-98-4486	March 19, 2001	Answer of MNG Airlines to United Air Lines	U.S. - Turkey
		Attachment: Operating License
		Service List

Regarding the answer of United Airlines, Inc. filed February 22, 2001, stating that MNG seeks to amend its application to include the right to operate scheduled passenger/cargo combination services, MNG denies any such request or application which could be seen in our docket dated February 7, 2001 and MNG wishes to clarify that the airline is not and will not be in passenger traffic and no air transportation of person is requested.

Counsel: MNG Cargo, Tekin Ertemel, 90.212.6974538, dispatch@mngaircargo.com

Editor's Note: The Original STAMPED Board copy provided to the public on February 7, 2001 shows a date of February 2nd with a signature date of January 18, 2001 and contains the PERSONS, property and mail language. The attachment provided by MNG is dated February 7, 2001 and contains the Property and Mail language. What's Up?

Index

Registration of DHL Worldwide Express, Inc. as a Foreign Air Freight Forwarder Pursuant to 14 CFR 297

OST-01-8732	March 19, 2001	Comments of DHL Worldwide Express	Registration of DHL Worldwide Express, Inc. as a Foreign Air Freight Forwarder Pursuant to 14 CFR 297
		Service List

UPS's motion offers no legal basis or factual evidence whatsoever that would warrant the Department taking such draconian action. The summary revocation of DHLWE's authority that UPS seeks is totally unsupported by the Department's regulations and precedent, in which stays are strongly disfavored. Even if a stay technically could be granted, UPS clearly has failed to and cannot -- bear the heavy burden of showing that a stay is appropriate here.

Counsel: Wilmer Cutler, Bruce Rabinovitz, 202.663.6000, brabinovitz@wilmer.com

Index

U.S.- Argentina Combination Charter Opportunities

Undocketed

Served March 19, 2001

Notice

U.S.- Argentina

By: Paul Gretch

Index

International Air Transport Association

OST-01-9008	Filed February 27, 2001	Approved March 12, 2001	Approval of Agreements
OST-01-9028	Filed February 27, 2001	Approved March 12, 2001
OST-01-9126	Filed March 8, 2001	Approved March 12, 2001
OST-01-9133	Filed March 5, 2001	Approved March 12, 2001
OST-01-9176	Filed March 14, 2001	Approved March 12, 2001

By: Paul Gretch

Index