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OST-00-7192

American Airlines, Inc.

Under the Memorandum of Discussions signed by the Governments of the United States and Vietnam on March 3, 2000, three U.S. carriers may be authorized to offer codesharing services to points in Vietnam in conjunction with third-country carriers. U.S. carriers may offer a total of 21 weekly frequencies under such arrangements. Swissair operates between Zurich and Ho Chi Minh City, Vietnam three days a week via Singapore. American proposes to place the "AA" designator code on Swissair's Zurich-Ho Chi Minh City flights in order to carry U.S.-Vietnam passengers connecting at Zurich from American's and Swissair's U.S. gateways (Atlanta, Boston, Chicago, Dallas/Ft. Worth, Miami, Los Angeles, New York (JFK), Newark, San Francisco, and Washington).

American and Swissair hold blanket statements of authorization under 14 CFR Part 212 to engage in reciprocal codesharing services, and are authorized to add new codesharing services subject to a 30-day notice requirement. See Department Action, OST-99-5944, November 2, 1999. Swissair will separately submit the required 30-day notice in OST-99-5944.

Counsel:  Carl Nelson, Jr., 202 496 5647, carl_nelson@amrcorp.com

American Airlines, Inc.

American Airlines, Inc., pursuant to the Department's Notice of April 5, 2000, hereby moves to consolidate its applications of April 5, 2000 in OST-00-7192 and OST-00-7191 for U.S.-Vietnam codesharing authority with Swissair and for related exemption authority into U.S.-Vietnam Third-Country Codesharing Opportunities, OST-00-7194, for contemporaneous consideration and decision. American also supplements its codeshare application in OST-00-7192 with the following information required by the Department's Notice.

• Markets, to be served. American will place its "AA" designator code on Swissair's flights between Zurich and Ho Chi Minh City, Vietnam, via Singapore, connecting with American's and Swissair's flights between Zurich and the following U.S. gateways: Atlanta, Boston, Chicago, Dallas/Ft. Worth, Miami, Los Angeles, New York (JFK), Newark, San Francisco, and Washington.
• Frequencies requested per market. American requests three weekly codeshare frequencies between Zurich and Ho Chi Minh City via Singapore.
• Duration of service. The proposed American/ Swissair codeshare service will be operated on a year-round basis.
• Codeshare partner. American's codeshare partner will be Swissair. The proposed service will be operated via Zurich, Switzerland, with an intermediate stop in Singapore between Zurich and Ho Chi Minh City.
• Type of aircraft. Swissair operates MD11s (12F, 49C, 180Y) between Zurich and Ho Chi Minh City. American operates B763s (12F, 42C, 142Y) between Zurich and the U.S. Swissair operates MD11s (12F, 49C, 180Y) and A330s (12F, 42C, 142Y) between Zurich and the U.S.
• Proposed start-up date. American and Swissair will implement their proposed codesharing services to Vietnam as soon as required authorizations are granted.
• American/Swissair codeshare agreement. The American/Swissair codeshare agreement was submitted to the Department on July 9, 1999 in OST-99-5944. American and Swissair were granted blanket codeshare authorizations under 14 CFR Part 212 on November 2, 1999, subject to a 30-day notice requirement for additional city-pairs. Following grant of American's application here for U.S.-Vietnam third-country codesharing authority via Zurich, Swissair will submit the required 30-day notice in OST-99-5944.

Counsel:  American, Carl Nelson, 202.496.5647, carl_nelson@amrcorp.com

U.S.-Vietnam Third Country Code Sharing Opportunities

Counsel:  American, Carl Nelson, 202.496.5647, carl_nelson@amrcorp.com

Counsel:  Shaw Pittman, Alexander Van der Bellen, 202.663.8060

Counsel:  Northwest, Megan Rae Rosia, 202.842.3193

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

U.S.-Vietnam Third Country Codesharing Opportunities

Order 2001-5-26 grants the motions of Northwest Airlines, Inc. and United Air Lines, Inc. to amend their applications in the captioned proceeding. The order also provides a further opportunity for all U.S. carriers interested in using the available U.S.-Vietnam third-country code-share opportunities to file new applications or to amend existing applications as set forth in this order. This order invites all U.S. carriers interested in using the opportunities at issue in this proceeding to file applications in Docket No OST-2000-7194 no later than June 1, 2001, providing the information set forth in the attachment to this order, answers to new or amended applications filed by June 8, 2001 and replies to answers June 13, 2001.

After consideration of the pleadings in this case and other relevant circumstances, we find that it is in the public interest to reopen the record and to accept additional evidentiary material before we make a decision on the award of the third-country code-share opportunities that are at issue in this proceeding. These third-country code-share opportunities represent valuable access for U.S. carriers to the Vietnam market, and we believe that it is important to ensure that we make full and effective use of the opportunities available. We called for applications to use these opportunities over a year ago. Several weeks after we instituted this case, however, the Department implemented guidelines to assess the safety of U.S. code-share passengers carried on a foreign air carrier code-share flight. Those guidelines apply to the regulatory review of code-share applications such as those involved here. Specifically, those guidelines provide for, among other things, audits by the U.S. carriers under accepted audit programs of their foreign carrier code-share airlines, review of the audit reports by the Federal Aviation Administration (FAA), and transmittal of the FAA's position to the Office of the Secretary. Processing of the applications in this case was delayed during the start-up phase of this new program.

We are unpersuaded by the arguments of American, Delta, and United that reopening the record in this case would be unfair to the parties or contrary to Department practice. While it is always our desire to process comparative selection cases in a prompt manner, the peculiar circumstances described above made that impossible here, and this case has been pending for over a year. During this period there have been changes in the market as well as changes in the operating restrictions relevant to the services to be provided. At least half of the parties to the case have now demonstrated that they have been rethinking the services that they would offer. With this background, the issue is how best to serve the public interest goals we contemplated in establishing this proceeding, while preserving procedural fairness. In the specific circumstances of this case, we conclude that to maximize the new opportunities that are available and to encourage enhanced public benefits, we should proceed on the basis of an updated record.

By: Susan McDermott

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