OST Filings for March 13, 2002

OST Docket Filings for March 13, 2002

Last Updated 03/13/02 09:05 PM

Applications and Renewals:

Aeromexico - Mexico City- Phoenix Renewal | C.A.L. Cargo - Tel Aviv- New York (JFK) Renewal

Delta/Korean/Air France/Alitalia/Czech - Antitrust Immunity

Jugoslovenski Aerotransport - Third Amended U.S.- Yugoslavia

Answers and Replies:

ANA/TWA - Joint Response of Northwest/United | Caribbean Star - Supplement No. 2

CRS (2)- Comments | Delta - Withdrawal of Application (Codeshare w/ Singapore)

EAS at Harrison/Hot Springs/El Dorado/Camden/Jonesboro, AR - EAS Proposal of Corporate Airlines

Edelweiss Air - Withdraw of Objection of ATM | NACA - Answer of Atlas Air (Definitions of Seven Freedoms of Air)

U.S.- Brazil Combination/American/Continental - Response of United

Notices of Action Taken:

Skyservice - Canada-US Renewal

Notices and Orders:

None

Aerovias de Mexico, S.A. de C.V.

OST-96-1304	March 13, 2002	Application for Renewal of Exemption Authority	Mexico City- Phoenix
		Service List

By this application, Aeromexico seeks renewal of its exemption authority to provide service between Mexico City and Phoenix. Although Aeromexico currently is serving the market on a one-stop basis, it desires to renew the authority so it can re-institute nonstop service when traffic conditions warrant.

Counsel: Verner Liipfert, William Evans, 202.371.6030

Index

All Nippon Airways Co., Ltd and Trans World Airlines, Inc.

OST-00-7089	March 12, 2002 Docketed March 13, 2002	Joint Response of Northwest Airlines and United Airlines and Motion for Leave to File	Exemption/Statement of Authorization - United States-Japan
		Service List

TWA/American would have the Department turn a blind eye to this manipulation of the international mail tender system and renew the underlying economic authority that supports the scheme. The Department should not entertain such a suggestion. The TWA/American dual code is inflicting damage on all other U.S. carriers that compete fairly for USPS mail traffic. It is also inconsistent with the public interest and Department precedent.

Counsel: Northwest, Megan Rosia, 202-842-3193, megan.rosia@nwa.com, Wilmer Cutler, Jeffery Manley, 202.663.6670, jmanley@wilmer.com

Index

C.A.L. Cargo Air Lines Ltd.

OST-01-9137	March 13, 2002	Application for Renewal of Exemption Authority	Tel Aviv and New York (JFK) via Liege, Belgium
		Service List

Hereby applies for a renewal of its exemption from 49 U.S.C. § 41301 to provide foreign air transportation of property and mail between Tel Aviv and New York (JFK) via Liege, Belgium

Counsel: Condon Forsyth, Evelyn Sahr, 202.289.0500

Index

Caribbean Star Airlines, Inc.

OST-01-11164 OST-01-11198	March 13, 2002	Supplement No. 2 to Application	Certificate of Public Convenience and Necessity - Scheduled and Charter Foreign Service
		Attachment A: Request for Additional Informational (March 7, 2002)
		Service List

The source of the total of $2.5 million in equity investments made in CSA to date is Mr. R. Allen Stanford, who is the ultimate sole owner of CSA. The source of the guaranty securing the $4.8 million Irrevocable Standby Letter of Credit from The Toronto-Dominion Bank to CSA is provided by Caribbean Star Airlines Holdings, Inc., which is the sole shareholder of CSA, and which, in turn, is wholly owned by Mr. Stanford. The reference to a $5 million line of credit mentioned in the Explanatory Notes on page 3 of Exhibit CSA-104 refers to The Toronto-Dominion Bank Standby Letter of Credit. That reference was inadvertently not corrected to read "$4.8 million" following CSA's determination that a $4.8 million line of credit would be adequate for its standby working capital requirements.

There are no existing agreements at this time between CSA and its foreign affiliated carrier, Caribbean Star Airlines, Ltd. CSA anticipates that it will enter into a marketing alliance or code-share agreement with CSA Ltd., and one or more other carriers, under standard industry terms. In addition, CSA may enter into contracts with CSA Ltd. for the provision of ground handling services and maintenance support at points served in common by both carriers.

At this time, CSA has not yet entered into any Aircraft Lease Agreements nor has it prepared or received any draft lease agreements. CSA expects to lease its first DeHavilland Dash-8 aircraft shortly prior to the time that such an aircraft is required in connection with CSA's FAA Part 121 certification process, which will commence as soon as the Show Cause Order tentatively granting CSA's Section 41102 certificate application has been issued by the Department.

Mr. Stanford's reasons for creating CSA and prosecuting applications for U.S. DOT and FAA certificate authority are two-fold. First, Mr. Stanford desires to create a high-quality U.S. citizen air carrier which is legally able to provide the highest attainable standard of safe, reliable and efficient service between points within the United States, including transportation between the mainland U.S. and Puerto Rico, and to other U.S. points in the Caribbean. Those intra-U.S. markets are not available to CSA Ltd., which is a foreign carrier. Second, CSA Ltd. is based in Antigua and is licensed by Antigua. At this time, Antigua is designated a Category 2 Country under the FAA's International Aviation Safety Assessment Program. For that reason, CSA Ltd. is not currently able to apply for U.S. authority to perform air transportation between points in the U.S. and Antigua and other foreign points in the Caribbean region and in Central and South America.

Counsel: Shaw Pittman, Nathaniel Breed, 202.663.8078

Index

Computer Reservation System Regulations

OST-97-2881

March 5, 2002
Docketed March 13, 2002

Comments of Anola Corporate Travel

Computer Reservation System (CRS)

It is with great concern and dread that I discovered you had extended the current CRS rules to March 31, 2003. I am only one of hundreds of small travel agencies located around the world who daily contend with the airlines practice in which they withhold the lowest airfares from a large number of private citizens. Unless you have computer access and the knowledge to use that access, you may be assured that you will not pay the lowest price. I am also concerned that there will be a large number of travel agencies who will no longer be operational by the end of this year due to this practice. Yes, I agree, that companies of any type do have the right to determine their own selling prices and the avenues they use to finalize those sales. But, why should I, not only as a company but also as an individual, have to battle my way through a large amount of data to determine whether or not I am receiving a fair deal?

By: Anola Corporate Travel, Betty Parkhill

OST-97-2881

March 2, 2002
Docketed March 13, 2002

Comments of Carlson Wagonlit Travel

Computer Reservation System (CRS)

I would respectfully request that the new rules include a provision that ALL fares be available to the public from all available sources. The fact that the airlines have made certain of their distressed inventory available only thru the internet is clearly from our point of view, a restraint of trade. Further if someone does not have access to a computer, such as many senior citizens, or do not visit the right web, site they will not get the lowest fare. It makes no sense to sell a ticket over the internet for several hundred dollars less than what we are able to sell it just to avoid paying the travel agent a few dollars in commissions. Clearly the airlines want to eliminate the travel agent from the equation and thereby control the market, and then raise fares. If the travel agents were able to access these "web-only fares" then everyone would truly have access to the lowest airfare possible. Including corporate travelers that often pay much more than they should have to spend because they have purchase a last minute ticket.

By: Carlson Wagonlit Travel, W. Jeff Rowlands

Index

Delta Air Lines, Inc.

OST-97-754

March 13, 2002

Re: Withdrawal of Application

Codeshare w/Singapore Airlines Limited

Counsel: Shaw Pittman, Alexander Van der Bellen, 202.663.8362, sascha.vanderbellen@shawpittman.com

Index

Delta Air Lines, Inc., Korean Air Lines Co., Ltd., Societe Air France, Alitalia- Linee Aeree Italiane- S.p.A., and Czech Airlines

OST-02-11842	March 13, 2002	Joint Application for Approval of and Antitrust Immunity of Alliance Agreements	Approval of and Antitrust Immunity of Alliance Agreements
		Exhibit JA-1: Cooperation Agreement
		Exhibit JA-2: Coordination Agreement
		Exhibit 3-13: Map, Routes, City Pairs, Schedules
		Exhibit 14: Document Production
		Service List

The addition of KAL to the Delta/Air France/Alitalia/CSA immunized alliance group is an important step toward bringing enhanced competition and efficiency to the U.S.-Asia marketplace. Delta is a strong international competitor over the transatlantic and between the U.S. and Latin America. However, Delta has a very limited presence in Asia. At present, Delta serves just a single transpacific route: Atlanta-Tokyo.

By forming an immunized alliance with KAL, Delta will gain access to KAL's U.S.-Korea transpacific network, and will be able to offer customers access to scores of cities throughout Asia via KAL's Seoul hub. KAL, in turn, will become a more effective U.S.-Asia competitor by gaining improved access to hundreds of additional U.S. cities through Delta's extensive U.S. network. Together, Delta and KAL will be able to offer U.S.-Asia travelers and shippers a much more competitive and comprehensive network than either carrier is capable of providing individually.

The global competitive benefits of the Delta/KAL alliance are further enhanced by their proposed joint immunized relationship with Air France, Alitalia and CSA. While the focus of the Delta/KAL relationship is on transpacific traffic, the joint participation of European partners will facilitate the creation of an alliance with true global reach and capabilities. KAL fills an important gap by enabling Delta and its partners to offer alliance customers comprehensive access to destinations across Asia - a region where none of the existing alliance partners has a significant presence.

Counsel: Korean and Zuckert Scoutt, William Callaway, 202.973.7906, Delta and Shaw Pittman, Robert Cohn, 202.663.8060, Air France and Silverberg Goldman, 202.944.3305, Czech and Mendelsohn O'Keefe, 202.775.0680, and Alitalia and Zuckert Scoutt, Richard Mathias, 202.298.8660

OST-02-11842

March 13, 2002

Motion for Confidential Treatment

Approval of and Antitrust Immunity of Alliance Agreements

Index

Edelweiss Air, Ltd.

OST-02-11481

March 13, 2002

Withdraw of Objection of ATM

U.S.- Switzerland

On February 20, 2002 ATM filed a Notice of Objections against the issuance of a foreign air carrier permit Pursuant to 49 U.S.C § 41301 filed by, and in favor of Edelweiss Air Ltd Pursuant to the Reply of Edelweiss Air, Ltd filed on March 4, 2002, and upon careful examination of the issues involved, ATM has decided not to pursue its contemplated proceedings and therefore withdraw all its objections forthwith.

Counsel: ATM, Serge Barder, 305.361.7357

Index

Essential Air Service at Harrison, Hot Springs, El Dorado/Camden, Jonesboro, Arkansas

OST-97-2935

March 4, 2002
Docketed March 13, 2002

Proposal of Corporate Airlines to Provide Essential Air Service

Essential Air Service at Harrison, Hot Springs, El Dorado/Camden, Jonesboro, Arkansas

By: Corporate Airlines

Index

Jugoslovenski Aerotransport

OST-96-1182	March 13, 2002	Third Amended Application for Exemption	U.S.- Yugoslavia
		Exhibit List
		Attachment 02-1: Letter form Milan Lezaic on Reciprocity
		Attachment 02-2: Key Personnel
		Attachment 02-3: Air Operator Certificate
		Attachment 02-4: Aircraft
		Attachment 02-5: Scheduled Services
		Attachment 02-6: Profit and Loss and Balance Sheets
		Attachment 02-7: Insurance Documents
		Attachment 02-8: Certification
		Service List

Herewith updates and otherwise amends its pending request for an exemption from 49 U.S.C. § 41301 to permit JAT to provide scheduled nonstop air transportation of persons, property and mail between Belgrade and New York (JFK) using JAT's 271-seat DC-10-30 aircraft. JAT submitted a Second Amended Exemption Application in this Docket in March 2001, which Application has not been either granted or denied. JAT maintains its desire to offer service to the United States, and the present Amended Exemption Application updates the request to cover 2002, modifies the authority requested, and provides updated supporting exhibits.

Specifically, JAT respectfully requests an exemption from 49 U.S.C. § 41301 to permit JAT to provide nonstop scheduled air transportation of persons, property and mail two times per week between Belgrade (BEG) and New York (JFK) and Chicago (ORD) using JAT's 271-seat DC-10-30 aircraft. JAT also requests U.S. -Yugoslavia passenger charter authority. The applicant will provide two roundtrips per week, to be operated with 271-seat DC-10-30 equipment. Initially, JAT plans to offer BEG-JFK service, on Wednesday and Friday. The flights will depart BEG at 10:00 a.m., arriving JFK at 1:00 p.m., then departing JFK at 3:00 p.m., arriving BEG at 6:30 a.m. the following morning (all times are local). Following the introduction of that service, JAT plans to expand the two weekly roundtrips to include service at Chicago (ORD). The service will continue to be offered on Wednesday and Friday. The flights will depart BEG at 9:00 a.m., arriving ORD at 12:00 noon, then departing ORD at 1:00 p.m., arriving JFK at 4:30 p.m., then departing JFK at 6:30 p.m., arriving BEG at 8:30 a.m. the following morning (all times are local).

Counsel: Wiley Rein, Bruce McDonald, 202.719.7000

Index

National Air Carrier Association

OST-02-11741	March 13, 2002	Answer of Atlas Air to Petition for Rulemaking	Add Definitions of the Seven "Freedoms of the Air"; to Delete the Current Peculiar Definition of "Fifth Freedom Charter" and Other Relief
		Service List

In order to redress the competitive disadvantage that U.S. air carriers experience in certain international charter markets, the National Air Carrier Association has petitioned the Department to change its policies and regulations governing the prior approval of charter flights by foreign air carriers between the United States and third countries. NACA's discussion of problems and remedial measures is limited to the passenger sphere. Yet similar considerations pertain to cargo, and actions taken to address passenger issues may ultimately affect cargo. Atlas Air, Inc. accordingly is submitting its views.

Reduced to essentials, NACA's point is that the Department's liberal policy toward third-country charters accords certain foreign carriers access to large U.S. markets regardless of whether U.S. carriers have access to equally sized markets over which the foreign carriers' governments have control. Similarly, NACA states, foreign carriers often have little interest in serving 3rd and 4th freedom (U.S.-homeland) markets. These concerns are legitimate and apply to cargo as well as passengers. For instance, Ukrainian airline Antonov Design Bureau is regularly permitted to operate third-country cargo charters to and from the United States, even in large and thus valuable markets such as the U.S.-U.K. market. Technically, U.S. carriers may be entitled to operate comparable third-country services to and from the Ukraine, but the economic reality is that the U.S. airline rights are far less valuable than the Ukrainian airline rights because there is much less Ukraine O&D traffic than U.S. O&D traffic. The same is true of carriers from relatively small countries that have open skies agreements with the United States. Ghanaian-established carrier MK Airlines, for example, has obtained a blanket DOT waiver to conduct third-country charters wherever it wishes, even though its U.S. services are predominantly to and from third countries and U.S. carriers are unlikely to have much interest in operating third-country charters to and from Ghana.

Counsel: Atlas Air, Russell Pommer, 202.354.3843

Index

Skyservice Airlines Inc./Linges Aeriennes Skyservice Inc., d/b/a Roots Air

OST-01-8735

Filed January 25, 2002
Issued March 13, 2002

Notice of Action Taken

U.S.- Canada Scheduled Services

Exemption to permit the applicant to conduct scheduled, combination service between any point or points in Canada and any point or point in the United States.

By: Paul Gretch

Index

U.S.-Brazil Combination Service Frequencies; American Airlines, Inc. and Continental Airlines, Inc.

OST-02-11711 OST-02-11627 OST-99-6284 OST-02-11615	March 13, 2002	Consolidated Response of United Air Lines and Motion for Leave to File	U.S.- Brazil Combination Frequencies (Atlanta-Rio de Janeiro) Dormancy Waivers
		Service List

United, which holds no U.S.-Brazil frequencies that are subject to dormancy conditions, did not answer either Delta's request for extension of its temporary allocation or the requests of American and Continental for extensions of their dormancy waivers because none of those requests had any direct affect on United. Delta's subsequent request for a "permanent" reallocation of four frequencies, however, threatens to raise issues that could affect United as well as the other designated U.S.-Brazil carriers. American has, for example, urged that seven of United's unconditioned U.S.Brazil frequencies be placed at issue in any proceeding involving Delta's request for a "permanent" reallocation and that American's eleven unused frequencies be exempted from that process. The premise for American's unprecedented request seems to be that it had announced plans as of March 8, 2002 (the date of its Motion and Response in Docket OST-99-6284) for reuse of its eleven dormant frequencies. What American ignores, however, is that United has also implemented plans for reutilization of its seven temporarily suspended U.S.-Brazil frequencies. United has established October 31, 2002, as the date on which it will again use those frequencies for daily nonstop New York-Sao Paulo services.

Delta's original request in Docket OST-02-11627 for continuation of its temporary reallocation was, in effect, open-ended. That reallocation would continue for as long as there remained U.S.-Brazil frequencies that were not used by their original holder, and whenever the holder proposed to use them, it would be required to give 90days' notice to Delta and DOT. Such a temporary allocation gives Delta sufficient flexibility to plan at least through the end of this year when Continental and American propose to reuse their dormant frequencies. Should it appear 90 days before that time that any of these frequencies will continue to be unused, the Department can then revisit the issue of whether to consider a permanent reallocation. Until that time, the Department should undertake no proceeding to "permanently" reallocate frequencies which are not yet restored to service due to the impact of the events of September 11.

American's own position is inconsistent with the inclusion of United's suspended frequencies. Thus, American urges that its own plans to reutilize its currently dormant frequencies should protect such frequencies from inclusion in a reallocation proceeding. However, this ignores the fact that United plans to reuse its seven frequencies later this year while American would not reuse all of its frequencies until next year, more than two months after United's restart date.

Counsel: Wilmer Cutler, Jeffery Manley, 202.663.6670, jmanley@wilmer.com

Index