OST-98-3515 / Kenya Airways and Northwest Airlines / Answer of Delta Air Lines / March 5, 1998
Joint Application of
KENYA AIRWAYS LIMITED and NORTHWEST AIRLINES, INC.
Docket OST-98-3515 and Undocketed
for exemptions pursuant to 49 U.S.C. § 40109(c) and statements of authorization pursuant to 14 C.F.R. Parts 212 and 207 to engage in code-sharing
(U.S.-Amsterdam-Nairobi-beyond)
ANSWER OF DELTA AIR LINES, INC.
On February 18, 1998, Kenya Airways Limited ("Kenya Airways") and Northwest Airlines, Inc. ("Northwest") jointly filed for exemptions and statements of authorization to permit the carriers to implement a reciprocal codeshare agreement involving service between the United States, via Amsterdam, to Nairobi and points beyond. Delta Air Lines, Inc. ("Delta") objects to the issuance of the requested authorities, due to a failure of reciprocity on the part of the Kenyan Government. The Department should defer action on the Kenya
Answer of Delta Air Lines, Inc.
Page 2
Airways/Northwest request until Kenya grants Delta's long-pending request to serve Kenya on a third-country code-share basis.
The Joint Application correctly states that "there is no bilateral air service agreement between Kenya and the United States." Page 4. As such, all services, including code-share services, are governed by principles of comity and reciprocity. Delta respectfully disagrees with the Joint Applicant's assertion that their services are "fully supported by principles of comity and reciprocity [, and that] the Government of Kenya has been hospitable to U.S. carrier applications..." Id.
By letter dated September 22, 1997, Delta requested permission from the Kenya civil aviation authorities to implement third-county code-share service to Nairobi, in conjunction with Delta's alliance partner, Sabena. When authorization was not forthcoming, Delta's representatives met in person with the Kenyan authorities in October, 1997, and on several occasions thereafter. While Delta has been told that Kenya was considering the request, nearly six months later Delta still does not have permission to operate to Kenya. Accordingly, in light of this clear failure of reciprocity, the Department should refrain from granting the Joint Application until Delta's request to serve Kenya is honored.
Answer of Delta Air Lines, Inc.
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Although the Government of Kenya has authorized certain U.S. carrier code-share services, the Department should not allow Kenya to pick and choose which U.S. carriers will be afforded access to Kenya, and which will not. If Kenya Airways is awarded code-share authority to begin holding out services between the United States and Kenya, there would be even greater incentive for the Kenyan authorities to withhold authority from other potential U.S. competitors, such as Delta.
Furthermore, as stated in the Joint Application, "KLM Royal Dutch Airlines holds a 26 % interest in Kenya Airways. " Exhibit JE-8. Undoubtedly, this substantial ownership interest was a factor in Kenya Airways' decision to align itself with the Northwest/KLM alliance. The Department should not permit Kenya selectively to grant operating authority, particularly where, as here, the benefits of the proposed service will inure to its flag carrier and principal foreign investors.
Answer of Delta Air Lines, Inc.
Page 4
WHEREFORE, Delta Air Lines, Inc. urges the Department to defer action on the Joint Application until the Government of Kenya approves Delta's long-pending request to serve Kenya on a third-country code-share basis.
Respectfully submitted,
Robert E. Cohn
Alexander Van der Bellen
SHAW,PITTMAN,POTTS & TROWBRIDGE
2300 N Street, N.W.
Washington, D.C. 20037
(202) 663-8060
Counsel for DELTA AIR LINES, INC.