OST-2000-6728 - Aer Lingus - Dublin/Shannon

Delta strongly opposes the grant of any extrabilateral authority to Aer Lingus. The Government of Ireland's steadfast refusal to lift the Shannon stop requirement for U.S. carrier service to Ireland is one of the most significant bilateral restrictions existing in Europe today. The Shannon stop requirement exacts a large financial penalty on U.S. carriers seeking to serve Dublin by forcing them to provide uneconomical Shannon service, which is not supported by demand. Unless and until the Government of Ireland is willing to negotiate a lifting of this restriction, no extrabilateral authority of any sort should be granted to Irish carriers.

Pursuant to discussions among United Air Lines, Inc. and the above referenced applicants, the applicants have agreed to an extension of the date for an answer by United in these proceedings. Under the Department's rules, an answer to Aer Lingus' application in Docket OST-00-6728 would be due today, January 14, 2000 and to the American and Aer Lingus applications in Dockets OST-00-6725/26 on January 19 and 20, 2000, respectively. By agreement of the applicants, the date for a United answer to all pleadings may be extended to February 2, 2000. This extension is intended to allow all interested parties to seek an accommodation on certain issues raised by these applications

Please be advised that counsel for applicants American Airlines, Inc. and Aer Lingus Limited have agreed with counsel for Northwest Airlines, Inc. that the date by which Northwest may file an answer to the three above-referenced applications is extended to February 2, 2000. Under the Department's procedural rules, answers to Aer Lingus' application in Docket OST-006728, to American's application in Docket OST-00-6725 and to Aer Lingus' application in Docket OST-00-6726 were due on January 14, 19 and 20, 2000, respectively.

Please be advised that, given the February 2, 2000, deadline for United Air Lines, Inc. ("United") and Northwest Airlines, Inc. ("Northwest") in Dockets OST-00-6726 and 6728, counsel for United and Northwest, and counsel for Delta Air Lines; Inc., have agreed with counsel for Aer Lingus Limited ("Aer Lingus") that the date upon which Aer Lingus may file a consolidated reply as to both dockets is February 9, 2000.

Northwest Airlines has a serious interest in providing service to Ireland on a codeshare basis. In particular, Northwest wishes to offer codeshare service to Dublin without being required also to offer service to Shannon. Earlier this year, Northwest submitted a request to the Government of Ireland for authority to offer codeshare services to Dublin with a same-country carrier and with a third-country carrier or carriers (via points in third countries) on flights operated by such other carriers. The Government has not yet acted on that request, but Northwest is hopeful that the request will be favorably resolved in the near future and that Northwest will be able to offer such codeshare services. If the Irish Government does act favorably and satisfactorily on this request, Northwest does not expect that it will have a continuing basis to oppose the American and Aer Lingus applications.

For the very reasons that American and Aer Lingus consider codeshare operations to be a superior and efficient means of offering U.S.-Ireland service, so too does Northwest believe that it can best offer its own service - and new and attractive service options to consumers - in the U.S.-Ireland market on a codeshare basis. In the case of Northwest, this means codesharing with a carrier of a third country or with another U.S. carrier.

Both the Aer Lingus/American code-share application and Aer Lingus' Cities Program application, are extra-bilateral, as the applicants concede, Grant of these applications would require an affirmative finding of comity and reciprocity and, in the case of the Cities Program application, a determination that a procompetitive agreement is in place between the U.S. and Ireland, among other things. So long as the Government of Ireland declines to authorize United to code share on flights operated by British Midland between London and Dublin unless United complies with the Shannon stop requirement, which requires United to offer the same level of service to Shannon as to Dublin, the Department has no basis for a finding of adequate comity and reciprocity or the existence of a procompetitive regime necessary to approve the applications at issue

At the outset, it should be noted that the arguments presented by Delta in its Consolidated Answer are inconsistent with arguments that Delta presented to the Department of Transportation merely one year ago. For example, in March 1999, Delta sought an extension for Department approval of the code-share arrangement Delta had at that time with Aer Lingus. Specifically, in its March 1999 submission, Delta claimed that renewal of the Delta/Aer Lingus code-share authority would be in the public interest since, under the agreement, Delta was able to initiate daily, non-stop service between New York and Shannon as well as between New York and Dublin. (Delta Joint Application for Renewal at 2-3. Further, Delta claimed that the traveling public benefits from competitive service "on these important U.S.-Ireland routes." Therefore, not long ago, Delta claimed that service to Ireland pursuant to a code-share arrangement with a U.S. air carrier, including service to Shannon, was a valuable service that benefitted the public. This is completely inconsistent with its present position with regard to Aer Lingus's proposed code-share arrangement with American Airlines, Inc.

American wishes to address certain extraneous comments made by United and Continental. These comments are without merit, and provide no basis for the Department to reject the proposed Aer Lingus/American codeshare.

Order 2000-5-19 tentatively finding that the public interest warrants granting, for a one-year term(1) American Airlines, Inc., exemption authority to conduct scheduled operations in the New York-Shannon/Dublin market; (2) Aer Lingus Limited, a statement of authorization to display American's designator code in a number of U.S.-Shannon/Dublin markets; and (3) Aer Lingus, exemption authority to conduct scheduled operations in the Baltimore-Shannon/Dublin market. Objections due May 26, 2000 and Answers due May 31, 2000.

Apparently, the Government of Ireland is willing to eliminate the Shannon stop requirement for a handful of U.S. passenger carriers, provided they, in turn, are willing to serve Dublin indirectly through a third-country code-share. While this is certainly a positive development, it is an unacceptable alternative to elimination of the Shannon stop requirement for all U.S. carriers. Not only does it place U.S. combination carriers wishing to serve Dublin directly with their own aircraft at a competitive disadvantage, it does little to further the interests of integrated cargo carriers, like FedEx. Because FedEx is encouraged by the positive developments embodied in Order 2000-5-19, it has chosen not to file a statement of objections. If, however, substantial progress is not made toward elimination of the Shannon stop requirement and general liberalization of the aviation relations between the United States and Government of Ireland over the course of the next year, FedEx will strenuously object to any renewal of the exemptions and statement of authority sought by American and Aer Lingus.

United has no objection to the Department's finalizing its tentative decision to award extrabilateral. authority to American and Aer Lingus so long as the Department at the same time grants the pending application of British Midland to code share for United on British Midland's flights between London Heathrow and Dublin., This United/British Midland code share is also extrabilateral under the U.S./Ireland agreement, but the Irish government has indicated as part of the April 27 understanding its intention to allow the United/British Midland code share to operate. United's code share with British Midland will offer competition with the new extrabilateral services of American and Aer Lingus. It is important that all of these extrabilateral services should be permitted to start at the same time so that none is allowed to gain a competitive advantage over the other. The Irish government concurs with this position and, as United understands it, is prepared to allow both the United/British Midland and American/Aer Lingus code-share services to begin at the same time.

In its comments, United states that it has no objection to the Department's finalizing its tentative decision to award extra-bilateral authority to Aer Lingus and American Airlines Inc. ("American") as long as the Department at the same time grants British Midland's pending application to code share for United on British Midland's flights between London Heathrow and Dublin. In response, Aer Lingus asserts that the Aer Lingus and American applications should not be delayed pending the finalization of an order in the British Midland matter. Order 2000-5-19 should be finalized as soon as possible. Aer Lingus has no objection to the British Midland request, and the finalization of Order 2000-5-19 would not have any impact on United's efforts to continue working with the parties involved in the British Midland proceedings in order to obtain expeditiously any U. S. authority it requires. The fact that the British Midland request is still pending before the Department does not warrant withholding authority from Aer Lingus and American in the instant proceedings. As to the comments submitted by FedEx in this matter, it is important to note that FedEx has not raised any objection to finalizing Order 2000-5-19 at this time. Instead, FedEx states that it might object in the future when renewal of the authority granted in such order is under review, but only if aviation relations between the United States and Ireland are not further liberalized. FedEx's comments are more in the nature of negotiating advice to the Department. Extra-bilateral authorities, such as those at issue in these proceedings, are, by their nature, reviewable in the normal administrative process. Therefore, there is no need for any specific provisions for review in this instance. None of the issues raised in United's and FedEx's comments warrant delay in finalizing Order 2000-5-19. Accordingly, Aer Lingus respectfully requests that the . Department finalize such order as soon as possible.

While FedEx is, of course, free to file whatever protest it wishes next year, there cannot be the implication that the Department concurs in the conditioning of the renewal of the exemption approved in this Order on events to which the Government of Ireland has not agreed. Maryland concurs that the removal of the Shannon stop requirement is an important goal and should be pursued in government negotiations, but it should not be used in an exemption proceeding to initially condition or subsequently withdraw the Department's authorization of significant new U.S.-Ireland services. Although Maryland believes that the Department's Order is clear, and that the interpretation FedEx would put on it is without foundation, Maryland submits that the Final Order should definitively reject any threat that the exemptions would be withdrawn after a year unless the Shannon stop requirement is lifted. Aer Lingus and the Government of Ireland, as well as the Maryland Aviation Administration, should be reassured that their investment in the new service, now encouraged, will not be aborted.

We have decided to finalize our tentative findings and conclusions in Order 2000-5-19. In taking this action, we note that significant public benefits will flow from the approval of the American/Aer Lingus requests. These new services, and the services by U.S. carriers that the Irish Government has undertaken to approve, will substantially enhance competition in the U. S -Ireland market and will provide important, valuable benefits to the traveling public and to all of the U.S. cities which will be affected by these new services. In light of these benefits. and the April 27 undertaking referred to above, we find that finalization of our tentative decision in Order 2001-5-19 is in the public interest.

We also note that United and Federal Express do not oppose our finalization of that order.3 At the same time we share the Federal Express concerns about the Shannon stop requirement. In this regard, we emphasize that, as we said in Order 2000-5-19, our decision here does not lessen our desire to reach agreement to eliminate the Shannon stop requirement as it applies to U.S. carriers, and we will continue to urge the Government of Ireland to work with us to achieve that end.

Aer Lingus Limited hereby requests renewal of a Statement of Authorization under 14 C.F.R. Part 212 to permit the continuation of its code-share arrangement with American Airlines, Inc., pursuant to which Aer Lingus and American place their respective two letter designator codes on flights operated by Aer Lingus. Such flights serve the following city-pairs: New York (JFK and Newark) and Shannon/Dublin; Boston and Shannon/Dublin; Chicago and Shannon/Dublin; and Los Angeles and Shannon/Dublin. The authority for the code-share would otherwise expire on June 15, 2001.

Aer Lingus also hereby requests renewal of its exemption under 49 U.S. C. 40109 permitting it to conduct scheduled foreign air transportation of persons, property and mail between Baltimore, Maryland and Shannon/Dublin, Ireland. Aer Lingus requests renewal of the exemption for an indefinite period as well. Authority to offer service between Baltimore and Shannon/Dublin also would otherwise expire on June 15, 2001.

Renewal of the authority to code-share with American will result in continued enhancement of competition in the U.S. -Ireland market, and provide important, valuable benefits to the traveling public and to all of the U.S, cities affected by the arrangement. The Aer Lingus/American code-share arrangement has injected new, non-stop U.S. -flag competition between the United States and Shannon/Dublin, Ireland. Under the arrangement, Aer Lingus and American will continue independently to market, sell and price their respective services. If the renewal application is granted, this manner of competitive pricing and marketing will continue to benefit the traveling public directly by providing additional competitive service options. Such an arrangement shall also continue to benefit international aviation from an economic and passenger service standpoint by providing increased opportunities for economic growth and international commerce. Granting this request would also result in continued direct and significant economic benefits to U. S. aviation interests, including U.S. communities and American Airlines.

Aer Lingus continues to hold underlying authority to serve Ireland from Boston, Chicago, Los Angeles and New York in its foreign air carrier permit issued by Order 91-5-28, dated May 3 0, 1991. American holds underlying authority to serve Ireland from Boston, Chicago, and Los Angeles in its certificate for Route 602, issued by Order 91-4-47, dated April 28, 1991. American holds underlying authority to serve Ireland from New York as a result of the American/TWA route transfer, Order 2001-4-7, April 6, 2001, effective April 9, 2001, authorizing scheduled foreign air transportation of persons, property and mail between New York/Newark and points in Ireland.

On June 15, 2000, the Department, in a single order, granted Aer Lingus Limited ("Aer Lingus") an exemption to conduct scheduled services between Baltimore and Shannon/Dublin and a statement of authorization to place the designator code of American Airlines, Inc. ("American") on Aer Lingus flights between New York, Boston, Chicago, and Los Angeles, on the one hand, and Shannon/Dublin, on the other. Order 2000-6-12, at 4. In a related decision issued on the same day, the Department also granted a statement of authorization (#96-13, Undocketed) permitting British Midland Limited ("British Midland") to place United's designator code on British Midland flights between London and Dublin on a blind sector basis. All of the above authorizations are due to expire on June 15, 2001. The Department's grant of the applications of Aer Lingus/American and United/British Midland was based on a reciprocal, extra-bilateral "undertaking" between the U.S. and Irish governments to permit implementation of the carriers' proposed services. See Order 2000-5-19.

hereby requests renewal of a Statement of Authorization under 14 C.F.R. Part 212 to permit the continuation of its code-share arrangement with American Airlines, Inc., pursuant to which Aer Lingus and American place their respective twoletter designator codes on flights operated by Aer Lingus. Such flights serve the following city-pairs: New York (JFK and Newark) and Shannon/Dublin; Boston and Shannon/Dublin; Chicago and Shannon/Dublin; and Los Angeles and Shannon/Dublin. The authority for the code-share would otherwise expire on September 6, 2002.

Aer Lingus also hereby requests renewal of its exemption under 49 U.S.C. 40109, permitting it to conduct scheduled foreign air transportation of persons, property and mail between Baltimore, Maryland and Shannon/Dublin, Ireland. Although Aer Lingus was constrained to discontinue service between Baltimore and Ireland, it anticipates reinstating such service this Fall. Aer Lingus requests renewal of the exemption for an indefinite period as well. Authority to offer service between Baltimore and Shannon/Dublin also would otherwise expire on September 6, 2002.

Maryland strongly supports Aer Lingus' Application and respectfully submits that its nonstop BWI-Shannon/Dublin service remains consistent with the public interest and should be renewed for the following reasons. First, Baltimore continues to qualify as an underserved U.S. community with respect to transatlantic air service. BWI's direct scheduled transatlantic service remains limited to London, England, and Reykjavik, Iceland. Consequently, BWI's transatlantic service would be significantly improved by the operation of the Dublin/Shannon-Baltimore route on a scheduled, nonstop basis. In addition to significantly enhancing BWI's limited transatlantic service, nonstop service would benefit passengers and shippers.

United and bmi agree with Aer Lingus that the operating authorizations for these extrabilateral operations should all be issued for indefinite periods. Indeed, the Department's policy is to issue statements of authorization for code-share services for indefinite terms. In the event that the Department grants the request of Aer Lingus for an indefinite renewal of either or both of its exemption and statement of authorization, United and bmi request that the same action be taken with respect to bmi's statement of authorization in Docket OST-01-9830. There is no basis for treating the Aer Lingus/American portion of this extrabilateral arrangement on more favorable regulatory terms than those applicable to the United/bmi portion.

Counsel: Squire Sanders, Marshall Sinick, 202-626-6600, msinick@ssd.com for British Midland / Wilmer Cutler, Jeffrey Manley, 202-663-6670, jmanley@wilmer.com for United

Relief requested: (1) Renew statement of authorization under 14 CFR 212 of the Department's regulations to place the designator code of American Airlines, Inc., on Aer Lingus flights in the following markets: New York-Shannon/Dublin, Boston-Shannon/Dublin, Chicago-Shannon/Dublin, and Los Angeles-Shannon/Dublin, for an indefinite period; and (2) Renew exemption from 49 U.S.C. 41301 to conduct scheduled foreign air transportation of persons, property and mail between Baltimore, MD, and Shannon/Dublin, for an indefinite period.

Aer Lingus requests an amendment so that it will be permitted to display American's two-letter designator code on flights operated by Aer Lingus between Baltimore, Maryland and Shannon/Dublin, Ireland, in addition to the city pairs that are currently covered by such authorization. Aer Lingus hereby states that it will continue to comply with all applicable Department of Transportation rules relating to code-share service and with each of the other conditions normally imposed by the Department on code-share arrangements.

Maryland respectfully submits that Aer Lingus' request to display American's two-letter designator code on Aer Lingus' nonstop BWI-Shannon/Dublin operations is consistent with the public interest and should be granted for the following reasons. First, Baltimore continues to qualify as an underserved U.S. community with respect to transatlantic air service. BWI's direct scheduled transatlantic service remains limited to London, England, to Reykjavik, Iceland, and, resuming in the Spring, to Shannon/Dublin, Ireland. BWI's transatlantic service would be significantly improved by the operation of the Dublin/Shannon-Baltimore route on a code-share basis with American. Second, the proposed Aer Lingus/American code-sharing arrangement would greatly benefit passengers and shippers. This arrangement will introduce new nonstop U.S. flag competition between BWI and Shannon/Dublin. Specifically, U.S. travelers, the Baltimore community, the greater Washington/Baltimore metropolitan area, and American would benefit from the proposed code-sharing operations. These operations would offer a greater choice in transatlantic air service at competitive prices, allow for more efficient use of aircraft capacity and ground facilities, and provide coordinated scheduling and service for travelers on Aer Lingus and American.

Amend Statement of Authorization last granted November 14, 2002, to permit Aer Lingus to display American Airlines' code on Aer Lingus flights between Baltimore-Shannon/Dublin

OST-00-6726 - Shannon/Dublin-Batlimore
OST-00-6728 - Shannon/Dublin - Boston/Chicago/Los Angeles/New York

Aer Lingus Limited hereby requests renewal of a Statement of Authorization under 14 C.F.R. Part 212 to permit the continuation of its code-share arrangement with American Airlines, Inc., pursuant to which Aer Lingus and American place their respective two-letter designator codes on flights operated by Aer Lingus. Such flights serve the following city-pairs: New York (JFK and Newark) and Shannon/Dublin; Boston and Shannon/Dublin; Chicago and Shannon/Dublin; and Los Angeles and Shannon/Dublin. The authority for the code-share would otherwise expire on November 14, 2003. Aer Lingus requests renewal of the Statement of Authorization for an indefinite period, consistent with the continued Department of Transportation practice regarding such requests for code-share authority.

Aer Lingus also hereby requests renewal of its exemption under 49 U.S.C. 40109, permitting it to conduct scheduled foreign air transportation of persons, property and mail between Baltimore, Maryland and Shannon/Dublin, Ireland. Aer Lingus requests renewal of the exemption for an indefinite period as well. Authority to offer service between Baltimore and Shannon/Dublin also would otherwise expire on November 14, 2003. The Aer Lingus/American code-share arrangement has injected new, non-stop U.S.-flag competition between the United States and Shannon/Dublin, Ireland. Under the arrangement, Aer Lingus and American will continue independently to market, sell and price their respective services.

OST-00-6726 - Shannon/Dublin-Baltimore
OST-00-6728 - Shannon/Dublin-Boston/Chicago/Los Angeles/New York

United and bmi urge that both bmi's statement of authorization in Docket OST-01-9830 and Aer Lingus' statement of authorization in the above-captioned dockets be renewed for indefinite terms. Unless, however, the Department is prepared to reconsider sua sponte its recent action limiting bmi' s renewal to one year and grant that renewal for the indefinite term for which bmi applied, it should limit Aer Lingus' renewal to the same one-year term it granted to bmi. It would be unfair and prejudicial to limit the bmi/United authority to a one-year term while granting an indefinite renewal for the Aer Lingus/American authority.

Counsel: Wilmer Cutler, Jeffrey Manley, 202-663-6670 for United / Squire Sanders, Marshall Sinick, 202-626-6651 for bmi

OST-00-6726 - Shannon/Dublin-Baltimore
OST-00-6728 - Shannon/Dublin-Boston/Chicago/Los Angeles/New York

(1) renew statement of authorization under 14 CFR 212 of the Department’s regulations to place the designator code of American Airlines, Inc. on Aer Lingus flights between Baltimore, Maryland, New York, New York, Boston, Massachusetts, Chicago, Illinois, and Los Angeles, California, on the one hand, and Shannon/Dublin, Ireland, on the other hand, and

(2) renew exemption from 49 U.S.C. 41301 to conduct scheduled foreign air transportation of persons, property and mail between Baltimore, Maryland, on the one hand, and Shannon/Dublin, Ireland, on the other hand. Aer Lingus requests that we renew the authorities for an indefinite period.

The State of Maryland, United Air Lines, Inc. and British Midland Airways Limited filed answers in response to Aer Lingus' renewal application. The State of Maryland supports Aer Lingus' requests. In their joint answer, United/bmi state that the Department granted bmi a statement of authorization to conduct extrabilateral codeshare services for United between London and Dublin and limited the term of that authority to one year (see Notice dated May 12, 2003, in Docket OST-2001-9830). For that reason, United/bmi state that we should not grant Aer Lingus' request to renew its extrabilateral statement of authorization for the indefinite term requested unless the Department sua sponte acts to grant bmi's statement of authorization to code-share with United for an indefinite term. No further comments were filed in either docket.

OST-2000-6726 - Shannon/Dublin-Baltimore
OST-2000-6728 - Shannon/Dublin-Boston/Chicago/Los Angeles/New York

Hereby requests renewal of a Statement of Authorization under 14 CF.R. Part 212 to permit the continuation of its code-share arrangement with American Airlines, Inc., pursuant to which the American "AA*" two-letter designator code is displayed on flights operated by Aer Lingus. Such flights serve the following city-pairs: New York (JFK and Newark) and Shannon/Dublin; Boston and Shannon/Dublin; Chicago and Shannon/Dublin; and Los Angeles and Shannon/Dublin.

Also hereby requests renewal of its exemption under 49 U.S.C. § 40109, permitting it to conduct scheduled foreign air transportation of persons, property and mail between Baltimore, Maryland and Shannon/Dublin, Ireland. Although Aer Lingus was constrained to discontinue service between Baltimore and Ireland, it hopes to reinstate such service as early as this Summer.

In addition, Aer Lingus hereby requests renewal of an Amendment to the Statement of Authorization under 14 C.F.R. Part 212 to permit the continuation of its code‑share arrangement with American pursuant to which Aer Lingus displays American's two‑letter designator code on flights operated by Aer Lingus between Baltimore and Shannon/Dublin.

Lastly, Aer Lingus hereby requests an Amendment to the Department's Statement of Authorization under 14 C.F.R. Part 212 permitting Aer Lingus to engage in code‑share operations with American so that Aer Lingus will be permitted to display American's two‑letter designator code on flights operated by Aer Lingus in the following city pairs: Dublin‑London (Heathrow)/Glasgow/Manchester; Cork‑London (Heathrow); and Shannon‑London (Heathrow).

OST-2000-6726 - Shannon/Dublin-Baltimore
OST-2000-6728 - Shannon/Dublin-Boston/Chicago/Los Angeles/New York

Continental opposes the Aer Lingus request for extrabilateral codeshare authority for IJ.S.-Ireland codesharing with American via London Heathrow while other U.S. airlines, including Continental, are precluded from operating flights at London Heathrow and offering connecting codeshare service there to compete with American and its oneworid alliance partners. London Heathrow operating rights must include competitively viable and economic slots at London Heathrow at no cost and airport facilities at competitive rates. Ireland is a member of the European Union, which continues to refuse to reach an agreement with the United States to open London Heathrow to other US. airlines, including Continental, to compete with already entrenched U.S. incumbent airlines and their alliance partners at London Heathrow. The Department should respond to the European Union's continuing delay and lack of progress in reaching an agreement by refusing to approve extrabilateral codeshare authority. including the Aer Lingus request, via London Heathrow so long as its skies remain closed to effective new competition.

Since Baltimore is not an authorized gateway for carriers of Ireland, and transatlantic codeshare privileges are not provided to Aer Lingus under the operative bilateral, renewal of both of these requests is entirely dependent upon the existence of sufficient comity and reciprocity to support the application. There is certainly no basis to expand Aer Lingus's codeshare authority to include new U.S. Ireland routings via Heathrow.

Contrary to Aer Lingus's assertions, it is not "consistent with the continued Department of Transportation practice" to renew extrabilateral requests "for an indefinite period.". If these authorities are renewed at all, they should be for a limited period of short term duration ‑‑ not to exceed 179 days ‑‑ so that the Department can appropriately monitor Ireland's progress toward resolving the restrictive bilateral conditions that are negatively impacting Delta's U.S.‑Ireland services.

Baltimore continues to qualify as an underserved U.S. community with respect to transatlantic air service. BWI' s direct scheduled transatlantic service is limited to London, England, and Reykjavik, Iceland. Aer Lingus' previous scheduled, non‑stop service to Shannon/Dublin and anticipated reinstatement of this service would be a significant part of BWI's transatlantic service. In addition to enhancing BWI's limited transatlantic service, the Shannon/Dublin non‑stop service would benefit passengers and shippers and the Baltimore community and greater Washington/Baltimore metropolitan area.

The U.S. has been engaged in talks with Ireland for several months to conclude an open skies agreement. Part of that effort is aimed at eliminating the anticompetitive Shannon‑stop requirement. Enforcement of that requirement has precluded United from starting its own nonstop service between the U.S. and Dublin due to the cost and inefficiency of starting and maintaining a Shannon operation that would be shut down as soon as the Shannon‑stop requirement was eliminated.

Amendment of the Aer Lingus code-share authority on an extrabilateral basis while these negotiations are pending would be inconsistent with the action taken by the U.S. in the context of other negotiations when presented with similar requests for bilateral code-share authority. For example, in similar circumstances, the Department has refused to approve an expansion of code sharing between United and bmi to include United's display of bmi's code on United's London Heathrow-U.S. services. Even though that expansion would primarily benefit United through the additional bmi-coded traffic it would generate on transatlantic flights operated by United, the Department has withheld authority because of its judgment that expansion of such authority on an extrabilateral basis is not consistent with the present U.S./U.K. relationship in which the U.S. is seeking to obtain an open skies agreement. See Notice of Action Taken, dated December 3, 2003, in Docket OST-03-15758.

OST-2000-6726 - Shannon/Dublin-Baltimore
OST-2000-6728 - Shannon/Dublin-Boston/Chicago/Los Angeles/New York

The Government of Ireland has demonstrated ongoing comity and reciprocity in its treatment of other U.S. carriers' code‑sharing requests. In addition to its approval of the existing and proposed American Airlines code on Aer Lingus flights, the Government of Ireland also in 2000 approved a code‑share request of United and British Midland (bmi), whereby United's code is placed on bmi flights between London Heathrow and Ireland. Since that time, Irish authorities have permitted other U.S. carriers to serve Ireland via code shares over European city pairs, including Delta (with CityJet for Paris/Ireland service and with FIyBE for UK/Ireland service) and Continental (with FiyBE between the UK and Ireland). There has been no change in Ireland's flexible and responsive policies for reviewing extrabilateral code‑sharing requests by U.S. airlines to warrant denial of the instant application.

OST-2000-6726 - Shannon/Dublin-Baltimore
OST-2000-6728 - Shannon/Dublin-Boston/Chicago/Los Angeles/New York

Hereby replies to the answers submitted in this docket on May 6, 2005 by Continental Airlines, Inc., Delta Air Lines, Inc., and United Air Lines, Inc. In its application, Aer Lingus is seeking renewal of exemption and codeshare authority to display American's AA* code on Aer Lingus flights between the U.S. and Ireland, and an amended statement of authorization to display the AA* code on Aer Lingus flights between London Heathrow and Ireland. As we show below, the Aer Lingus application should be promptly approved in its entirety as consistent with principles of comity and reciprocity and with the public interest.

OST-2000-6726 - Shannon/Dublin-Baltimore
OST-2000-6728 - Shannon/Dublin-Boston/Chicago/Los Angeles/New York

United requests leave to respond to the replies of Aer Lingus and American as they relate to their alleged competitive need for the expanded extrabilateral code‑share they seek. United has the same need for competitive extrabilateral authority with bmi in the London Heathrow‑U.S. market which has been withheld by DOT for reasons which are equally applicable in the U.S.‑Ireland bilateral context. Aer Lingus and American ignore this aspect of competitive equality, and United seeks leave to respond on this issue to provide a more complete record.

We originally granted Aer Lingus authority to conduct extrahilateral code-share operations with American in 2000. In granting that authority, we noted that we had confirmed with the Irish authorities that they would approve certain same-country and third-country codeshare activities by U.S. carriers, and that our action did not lessen our desire to obtain the elimination of the Shannon stop requirement.

The bases upon which we acted in 2000, and in our renewals of this authority in subsequent years, remain, and in our view continue to warrant extension of this authority for an additional year. The Government of Ireland has continued to approve applications by U.S. carriers to conduct the above‑described code‑share services, thus demonstrating effective reciprocity notwithstanding the extrabilateral nature of the operations. While the Shannon stop requirement remains in place, we have made progress, in the context of broader negotiations with the EU in our attempts to attain its removal.

While Continental expresses concern over the limited nature of U.S. carrier access to Heathrow, we would note that, as American stated in its reply, U.S. carriers, including Continental, have been able to market services to Heathrow on a code‑share basis, in the same manner that Aer Lingus proposes to operate to Heathrow on behalf of American.

OST-2000-6726 - Shannon/Dublin-Baltimore
OST-2000-6728 - Shannon/Dublin-Boston/Chicago/Los Angeles/New York

Aer Lingus Limited hereby requests renewal of a Statement of Authorization under 14 C.F.R. Part 212 to permit the continuation of its code-share arrangement with American Airlines, Inc., pursuant to which the American "AA*" two-letter designator code is displayed on flights operated by Aer Lingus. Such flights serve the following city-pairs: New York (JFK and Newark) and Shannon/Dublin; Boston and Shannon/Dublin; Chicago and Shannon/Dublin; and Los Angeles and Shannon/Dublin. The authority for the code-share would otherwise expire on February 14, 2007. Aer Lingus requests renewal of the Statement of Authorization for an indefinite period, consistent with the continued Department of Transportation practice regarding such requests for code-share authority.

Aer Lingus also hereby requests renewal of its exemption under 49 U.S.C. § 40109, permitting it to conduct scheduled foreign air transportation of persons, property and mail between Baltimore, Maryland and Shannon/Dublin, Ireland. Although Aer Lingus was constrained to discontinue service between Baltimore and Ireland, it anticipates reinstating such service. Aer Lingus requests renewal of the exemption for an indefinite period as well. Authority to offer service between Baltimore and Shannon/Dublin also would otherwise expire on February 14, 2007.

In addition, Aer Lingus hereby requests renewal of Amendments to the Statement of Authorization under 14 C.F.R. Part 212 to permit the continuation of its code-share arrangement with American pursuant to which Aer Lingus displays American's two-letter designator code on flights operated by Aer Lingus in the following city pairs: Baltimore-Shannon/Dublin; Dublin-London (Heathrow)/Glasgow/Manchester; Cork-London (Heathrow); and Shannon-London (Heathrow). Aer Lingus requests renewal of the Amendments to the Statement of Authorization for an indefinite period. The authority for the Amendments would otherwise expire on February 14, 2007.

The cross-Channel operations are only for the carriage of American's U.S-Ireland traffic (without local traffic rights). American offers service to Ireland from its U.S. gateways via the following intermediate points: London (Heathrow), Glasgow, and Manchester.

OST-2000-6726 - Shannon/Dublin-Baltimore
OST-2000-6728 - Shannon/Dublin-Boston/Chicago/Los Angeles/New York

In its application, Aer Lingus seeks renewal of its existing extrabilateral authority to code-share with American Airlines, Inc. on services operated by Aer Lingus between the U.S. and Ireland and its extrabilateral BWI-Shannon/Dublin exemption. United has no objection to these renewals. With respect to their term, Aer Lingus once again seeks renewal of these authorizations on an indefinite basis. United holds similar but temporary authority to conduct extrabilateral code sharing on flights operated by British Midland Airways between London and Dublin. Notice of Action Taken, dated December 3, 2003 (Docket OST-2003-15758). Earlier this year, the Department rejected a request of United and bmi for an indefinite term on the renewal of their code-share authorization. Notice of Action Taken, dated June 2, 2006 (Docket OST-2003-15758). In the event that the Department grants Aer Lingus the renewals it seeks for an indefinite term, the Department should be prepared to grant similar relief sua sponte to United and brni by amending their code-share authorizations in Docket OST-2003-15758 to include a comparable indefinite term.

OST-2000-6726 - Shannon/Dublin-Baltimore
OST-2000-6728 - Shannon/Dublin-Boston/Chicago/Los Angeles/New York

In the past, the Department has extended extra-bilateral codeshare authority to carriers on a trial basis in order to entice restrictive foreign governments into more liberal aviation arrangements. However, when such governments have failed to show any progress on liberalization, as is the case with Ireland, the Department has declined to extend further authority. See, e.g., Order 1996-11-15. Aer Lingus has now enjoyed the generosity of the U.S. Government's grant of extrabilateral authority for several years. Yet, the Government of Ireland appears no closer to easing, much less lifting, the Shannon Stop Requirement than it was back in 2000 when Aer Lingus' BWI-SNN/DUB authority was first granted. The Department should no longer countenance, much less affirmatively endorse, this continued imbalance of extra-bilateral benefits by yet again renewing Aer Lingus' BWI-SNN/DUB authority. To grant this extra-bilateral authority would encourage the Irish Government to remain steadfast on its Shannon Stop Requirement and thumb its nose at the Department, U.S. carriers, and U.S. travelers.

Nor should the Department be reluctant to make a stand here. Aer Lingus concedes that it has not operated this service in a while, and thus the rejection of the renewal application will not affect the traveling public.

OST-2000-6726 - Shannon/Dublin-Baltimore
OST-2000-6728 - Shannon/Dublin-Boston/Chicago/Los Angeles/New York

Aer Lingus takes no position on United's request. We point out, however, that its comment glosses over the fact that United enjoys the very rights for which Aer Lingus seeks renewal in part, i.e., the right to codeshare between the United Kingdom and Ireland. In its application, Aer Lingus merely requests continued operational parity with United in this regard.

Delta objects to the BWI-Shannon/Dublin codeshare authority and Exemption aspect of the Aer Lingus application primarily on the grounds that the Shannon stop requirement adversely impacts Delta and other U.S. carriers. Delta fails to explain how denying this aspect of Aer Lingus' application would in any way advance the public interest or remedy the Shannon stop issue.

Delta's objections do not support a decision to deny renewal of the Baltimore-Shannon/Dublin codeshare authority or Exemption. Aer Lingus respectfully requests that the Department renew the Statement of Authorization to permit Aer Lingus and American to continue their code-share operations on flights in the New York/Boston/Chicago/Los AngelesShannon/Dublin markets for an indefinite period; renew the exemption permitting Aer Lingus to conduct scheduled service between Baltimore and Shannon/Dublin for an indefinite period; renew the Amendment to the Statement of Authorization to permit Aer Lingus and American to codeshare on flights in the Baltimore-Shannon/Dublin market for an indefinite period; renew the Amendment to the Statement of Authorization to permit Aer Lingus and American to continue their codeshare operations on flights in the (i) Dublin-London (Heathrow)/Glasgow/Manchester, (ii) ShannonLondon (Heathrow), and (iii) Cork-London (Heathrow) markets for an indefinite period; and grant such other and further relief as the Department deems to be in the public interest.

Maryland disagrees with Delta's position that Aer Lingus' Application for renewal of this authority for Baltimore-Shannon/Dublin should be denied by the Department. Maryland supports Aer Lingus' Application and respectfully submits that its current authority for both BWI-Shannon-Dublin service and the code-sharing arrangement with American Airlines each remain consistent with the public interest and should each be renewed.

Aer Lingus Limited hereby applies pursuant to 14 C.F.R. § 212 for an amendment to the statement of authorization permitting Aer Lingus' codeshare arrangement with American Airlines, Inc. Aer Lingus seeks an amendment to its statement of authorization in order to obtain blanket codesharing authority for property and mail only under the U.S.-EU open skies agreement. The authority requested will replace the limited codeshare rights now held by Aer Lingus that were initially granted in the above-referenced docket on June 15, 2000 by Order 2000-6-12, and subsequently amended to add new routes.

Further, Aer Lingus hereby gives notice of termination of its passenger codeshare arrangement, effective October 28, 2008. Cargo-only (property and mail) codesharing between the parties, with the "AA*" designator code on Aer Lingus-operated flights, will continue under the blanket codeshare authority requested.

Further, under the new cargo-only blanket codeshare arrangement, Aer Lingus and American will add new routes and will cease codeshare services on certain other routes that are covered by the current authority. Aer Lingus hereby notifies the Department that Aer Lingus and American will cease codeshare services for the Dublin-London (Heathrow)/Glasgow/Manchester; Cork-London (Heathrow); Shannon-London (Heathrow); and Baltimore-Shannon/Dublin routes. Codeshare service between Newark and Shannon/Dublin will also cease. The new codeshare routes to be added under the blanket authority for property and mail are San Francisco/Orlando/Washington D.C. (Dulles)-Shannon/Dublin.

OST-2000-6728 - Statement of Authorization - US-Ireland Codesharing with American Airlines	January 4, 2000	Application for a Statement of Authorization Scanned Copy	Dublin/Shannon - Baltimore
		Codeshare Agreement
		Annex A: Definitions
		Annex B: Codeshare Routes
		Annex C: Minimum Standards of Ground and In-Flight Services
		Annex D: Financial Settlement
		Annex E: Government Approvals
		Service List

OST-00-6728 OST-00-6726 OST-00-6725	January 13, 2000	Consolidated Answer of Delta Air Lines	Codeshare with American Airlines; Dublin/Shannon - Baltimore
		Service List

OST-00-6728	January 13, 2000	Answer of Massachusetts Port Authority	Codeshare with American Airlines; Dublin/Shannon - Baltimore
		Service List

OST-00-6725 OST-00-6726 OST-00-6728	January 14, 2000	Re: Agree to Extension of Answer Date	New York- Shannon/Dublin
		Service List

OST-00-6728	January 14, 2000	Answer of The State of Maryland in Support of Application of Aer Lingus	Dublin/Shannon- Baltimore
		Service List

OST-99-6725 OST-99-6726 OST-99-6728	January 20, 2000	Re: Extend Answer Date for Northwest Airlines	New York/Baltimore- Shannon/Dublin
		Service List

OST-00-6726 OST-00-6728	January 21, 2000	Re: Request for Leave to File an Otherwise Unauthorized Document and Reply	Baltimore- Shannon/Dublin
		Service List

OST-00-6726 OST-00-6728	February 1, 2000	Re: Extend Answer Date	Dublin/Shannon - Baltimore
		Service List

OST-00-6725 OST-00-6728	March 16, 2000	Consolidated Reply of Continental Airlines HTML	New York/Baltimore- Shannon/Dublin
		Service List

OST-99-6725 OST-99-6726 OST-99-6728	March 15, 2000	Consolidated Reply of Northwest Airlines HTML	New York/Baltimore- Shannon/Dublin
		Service List

OST-99-6725 OST-99-6726 OST-99-6728	March 15, 2000	Consolidated Reply of United Air Lines HTML	New York/Baltimore- Shannon/Dublin
		Service List

OST-00-6726 OST-00-6728	March 22, 2000	Consolidated Reply of Aer Lingus HTML	Baltimore- Shannon/Dublin
		Attachment 1: Joint Application of Delta and Aer Lingus for Renewal of a Statement of Authorization 3/08/99
		Attachment 2: Joint Application of Delta and Aer Lingus for Renewal of a Statement of Authorization 2/02/96
		Attachment 3: Joint Application of Delta and Aer Lingus for Renewal of a Statement of Authorization 2/16/96
		Service List

OST-00-6725 OST-00-6726 OST-00-6728	March 22, 2000	Consolidated Reply of American Airlines HTML	Baltimore- Shannon/Dublin
		Service List

OST-99-6725 OST-99-6726 OST-99-6728	March 30, 2000	Motion for Leave to File and Surreply of Delta Air Lines Scanned Copy	New York/Baltimore- Shannon/Dublin
		Service List

Order 00-5-19 OST-00-6725 OST-00-6726 OST-00-6728	Issued May 16, 2000 Served May 16, 2000	Order to Show Cause HTML	New York/Baltimore- Shannon/Dublin
		Appendix A: Conditions Applicable to American
		Appendix B: Conditions Applicable to Aer Lingus and American

OST-99-6725 OST-99-6726 OST-99-6728	May 26, 2000	Motion for Leave to File and Consolidated Comments of FedEx on Order 00-5-19	New York/Baltimore- Shannon/Dublin
		Service List

OST-99-6725 OST-99-6726 OST-99-6728	May 26, 2000	Comments of United Air Lines	New York/Baltimore- Shannon/Dublin
		Service List

OST-00-6725 OST-00-6726 OST-00-6728	May 31, 2000	Aer Lingus Limited Reply to Comments	Dublin/Shannon - Baltimore
		Service List

Order 00-6-12 OST-00-6725 OST-00-6726 OST-00-6728	Issued June 15, 2000 Served June 15, 2000	Final Order	New York/Baltimore- Shannon/Dublin
		Appendix: Conditions Applicable to American and Aer Lingus

OST-00-6726 OST-00-6728	May 15, 2001	Application for Renewal of Statement of Authorization and Renewal of Exemption	Ireland-US Codeshare with American Airlines
		Service List

OST-99-6726 OST-99-6728	June 5, 2001	Reply of United Air Lines	New York/Baltimore- Shannon/Dublin
		Service List

OST-00-6726 OST-00-6728	July 29, 2002	Application for Renewal of Statement of Authorization and Renewal of Exemption	Boston/Chicago/LA/NY- Shannon/Dublin and Baltimore- Shannon/Dublin
		Service List

OST-00-6726 OST-00-6728	August 13, 2002	Answer of the State of Maryland in Support of Application of Aer Lingus for Renewal of Exemption	New York/Baltimore- Shannon/Dublin
		Service List

OST-00-6726 OST-00-6728	December 20, 2002	Application for an Amendment to Statement of Authorization	Shannon/Dublin, Ireland-Baltimore; Boston/Chicago/Los Angeles/New York-Shannon/Dublin, Ireland - Codeshare with American
		Service List

OST-00-6726 OST-00-6728	December 31, 2002	Answer of the State of Marlyand	Shannon/Dublin, Ireland-Baltimore
		Service List