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OST-00-7194

U.S.-Vietnam Third Country Code Sharing Opportunities

On March 3, 2000, the United States and Vietnam signed a Memorandum of Discussions (MOD) that states the intent of the respective aeronautical authorities to allow, inter alia, third-country code-sharing of passenger air transportation services in the U.S.-Vietnam market (via intermediate points) on the basis of comity and reciprocity. Specifically, the MOD provides that up to three cooperative marketing arrangements between any number of U.S. airlines and any number of third-country airlines may be authorized.' The U.S. third-country code-share arrangements may serve between any points in the United States, on the one hand, and up to three Vietnamese points selected by the United States (via any intermediate points) on the other hand.' The MOD provides for a total of 21 weekly round-trip frequencies for use by U.S. carriers to operate these services.

Two U.S. carriers -- United Air Lines and Delta Air Lines -- have filed applications with the Department to serve the U.S.-Vietnam market under code-sharing arrangements with Thai Airways International and Air France, respectively. It is our desire to enable. interested carriers to use these opportunities as soon as possible. Before we decide how to award the available opportunities, to ensure that we have applications from all interested carriers, we request that all other U.S. carriers interested in making use of the available third-country code-share opportunities file applications as specified below with the Department no later than April 10, 2000. Answers to applications should be filed no later than April 14, 2000. Replies to answers should be filed no later than April 18, 2000.

The MOD does not contemplate direct service between the United States and Vietnam.

By:  Paul Gretch

American and Northwest Applications from April 5th

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

Northwest Airlines, Inc.

To supplement its application, Northwest states as follows: 

• Initially, Northwest plans to codeshare on four weekly roundtrip flights operated by MAS between Ho Chi Minh City and Kuala Lumpur and two weekly roundtrip flights between Hanoi and Kuala Lumpur, connecting with Northwest flights between Kuala Lumpur and Detroit and MAS flights (on which Northwest will also codeshare) between Kuala Lumpur and Los Angeles.
• Between Kuala Lumpur and both points in Vietnam, MAS will operate Boeing 737-400 aircraft with 16 business class seats and 128 economy class seats. Between Kuala Lumpur and Los Angeles, MAS will operate Boeing 747-400 aircraft with 24 first class seats, 60 business class seats and 318 economy class seats. Northwest operates Kuala Lumpur to Detroit single flight number service with change of gauge at Osaka (KIX). Between Kuala Lumpur and Osaka, Northwest operates DC-10 aircraft with 34 business class seats and 256 economy class seats. Between Osaka and Detroit, Northwest operates Boeing 747-400 aircraft with 18 first class seats, 62 business class seats and 338 economy class seats.
• The proposed six weekly flights will be operated on a year-round basis with no seasonal variations.
• Northwest plans to initiate the services contemplated in this application promptly following receipt of all necessary approvals and authorizations from the Department.
• A copy of the Northwest/MAS Commercial Cooperation Agreement was filed in Docket OST-2000-6792 on January 13, 2000.

Counsel:  Northwest, Megan Rae Rosia, 202.842.3193

United Air Lines, Inc.

Pursuant to the Department's notice dated April 5, 2000, in Docket OST 00-7194 United Air Lines,, Inc., supplements its above-captioned application as follows:  The seating configuration of Thai Airways' aircraft used for service to/from Vietnam is: A300-600 46 Business Class, 201 Economy Class / B737-40012 Business Class, 137 Economy Class

Counsel:  Wilmer Cutler, Jeffery Manley, 202.663.6670, jmanley@wilmer.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 Code Sharing Opportunities

As we show below, American should receive one of the three available designations, along with frequencies to serve between the U.S. and Ho Chi Minh City with Swissair via Zurich three days a week.

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

With four applicants seeking three designation opportunities, the Department need only eliminate the weakest applicant. Delta takes no position which of the three remaining proposals should be authorized once Delta is awarded the designation and seven frequencies necessary to implement its superior Vietnam service proposal.

Counsel:  Shaw Pittman, Alexander Van der Bellen, 202.663.8060

Counsel:  Northwest, Megan Rae Rosia, 202.842.3193

A review of the answers demonstrates that United has by far the strongest proposal of any applicant and that United's application should have priority in receiving both a code-share opportunity and frequency allocation. Only United can offer daily service to Ho Chi Minh City, a factor the Department has previously considered determinative in awarding code-share authority. Moreover, United offers more services to Hanoi than any other applicant and is the only carrier offering services to Da Nang. United's application should be granted for the additional reasons that it is in a position to start code-share services immediately and that only by selecting United can the Department avoid wastage of opportunities made available under the U.S./Vietnam March 3, 2000 Memorandum of Discussions ("MOD").

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

U.S.-Vietnam Third Country Code Sharing Opportunities and Vietnam Airlines Corporation

Delta does not object to Vietnam Airlines' request, which is consistent with the Memorandum of Discussions between the United States and Vietnam dated March 3, 2000 (the "MOD"). However, Delta urges the Department to resolve any outstanding regulatory matters and issue a decision as quickly as possible in the U.S.-Vietnam 77zird-Country Codeshare Proceeding, so that U.S. carriers will also be able to take advantage of the important negotiated benefits available under the MOD.

Delta and other carriers are eager to take advantage of these opportunities. Delta has had a pending request for third-country codeshare authority to serve Vietnam in conjunction with its alliance partner, Air France, since March 15, 2000. The last responsive filings in the pending Vietnam Codeshare Proceeding were submitted on April 15, 2000.

While Delta recognizes that there may be additional regulatory factors bearing on the approval of U.S. carrier codeshare arrangements beyond mere carrier selection factors, the situation.is now becoming critical, since Vietnamese carriers are preparing to launch third-country codeshare services, and U.S. flag carriers will be falling behind in the race to establish new competitive service in this important developmental market.

Counsel:  Shaw Pittman, Alexander Van der Bellen, 202.663.8060

Thai Airways International Public Company Limited/U.S.-Vietnam Third Country Code Sharing Opportunities/United Air Lines, Inc.

Counsel:  Wilmer Cutler, Cathleen Peterson, 202.663.6000, cpeterson@wilmer.com

U.S.-Vietnam Third Country Code Sharing Opportunities

Counsel:  Northwest, Megan Rae Rosia, 202.842.3193, megan.rosia@nwa.com 

U.S.-Vietnam Third Country Code Sharing Opportunities

Northwest has now come forward, almost a year after the record has closed, seeking to amend its application by adding transatlantic connections via Amsterdam to Kuala Lumpur and onward to Vietnam. To travel to Vietnam via such transatlantic routings, Northwest's passengers would be required to take three flight segments, with connections at both Amsterdam and Kuala Lumpur, on up to three different carriers, Northwest, KLM, and MAS.

Finally, we reiterate that Northwest and United dominate the Pacific. Northwest operates an average of 122 weekly frequencies between the U.S. and Pacific destinations, and United operates an average of 105. See American's answer of April 14, 2000, pp. 8-9 and Attachments. In order to redress the competitive imbalance in Pacific services, the Department should not award a limited-entry Vietnam third-country codeshare opportunity to either Northwest or United to the exclusion of American.

For the foregoing reasons, the Department should deny Northwest's motion and should strike its amendment. The Department should issue its show-cause order in this proceeding as promptly as possible, and grant one of the available opportunities to American, which will offer same-day connections between the U.S. and Vietnam for all its codeshare passengers with Swissair in both directions.

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

Counsel:  Shaw Pittman, Robert Cohn, 202.663.8060 

For the reasons set forth below, United Air Lines, Inc. strongly opposes Northwest's motion for leave to file this extremely belated amendment to its application. If, however, the Department decides to accept Northwest's amendment, United requests similar leave to amend its application to include transatlantic as well as transpacific connections and to accordingly increase the number of frequencies that it is seeking from fourteen to nineteen.

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

U.S.-Vietnam Third Country Code Sharing Opportunities

American Airlines, Inc. hereby answers in opposition to the contingent motion for leave to amend and Amendment No. 1 submitted by United Air Lines, Inc. on April 6, 2001. The Department should reject United's motion, and strike its purported amendment from the record.

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

The Department should immediately reject both the Northwest and United amendments, and proceed expeditiously with the issuance of a Final Order. Delta hereby adopts and incorporates by reference the legal and policy reasons set forth in Delta’s April 6, 2001 Answer to Northwest, which apply with equal force to compel the rejection of United’s Contingent Amendment. In the event that either the Northwest or United amendment is accepted, Delta reserves the right to submit its own amended proposal, and to comment substantively on the other applicants’ new proposals.

Finally, Delta would observe that United’s Contingent Amendment is of little practical consequence to this proceeding. United has requested five more frequencies on top of its already excessive request for 14 frequencies -- for a total of 19 out of 21 frequencies, which would leave just two frequencies for the other applicants. United’s request would effectively nullify the important negotiated benefits of the two additional codeshare designation opportunities. Since United has now requested nearly three times more frequencies than the other applicants, its exhibits touting greater seat capacity are not compelling.

Delta’s seven frequency proposal, offering nonstop-to-onestop connections from eleven U.S. gateways to two cities in Vietnam, would make better and more effective use of the limited Vietnam codeshare opportunities than United or any other applicant’s original or amended proposal. Under no circumstances should United receive a designation or any codeshare frequencies at the expense of a full award to Delta.

Counsel:  Delta and Shaw Pittman, Robert Cohn, 202-663-8060

U.S.-Vietnam Third Country Code Sharing Opportunities

In response to the claims of potential “unfairness” if Northwest’s motion were granted, Northwest states that it has no objection whatever to the Department allowing all four of the applicants equal opportunities to update their applications. Indeed, United has already proceeded to do so. The simple fact of the matter is that over a year has passed since the applications were filed in this proceeding. To the surprise of no one, circumstances have changed during that time. These changed circumstances include developments in commercial relationships, such as the developments in Northwest’s code-share relationships with KLM and Malaysia Airlines, and changes in the regulatory environment, such as the expiration of the ban on overflying Afghanistan. To allow the parties to update their applications to reflect changed circumstances makes sense and would be in the public interest.

No one should be heard to argue that the public interest would be better served by having the Department make a decision in this proceeding on the basis of facts that are stale and circumstances that no longer apply. If the substantial passage of time allows the applicants to offer service options that are superior to and promise more consumer benefits than the services they originally proposed, the public should be allowed to receive those benefits.

Counsel:  Northwest, Megan Rae Rosia, 202.842.3193, megan.rosia@nwa.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

U.S.-Vietnam Third Country Code Sharing Opportunities

American and Swissair will provide nonstop-to-one-stop connections, via Zurich, between 10 gateway cities in the United States and Ho Chi Minh City. The U.S. gateway cities with nonstop service to Zurich on either American or Swissair are Atlanta, Boston, Chicago, Dallas/Ft. Worth, Los Angeles, Miami, New York (JFK), Newark, San Francisco, and Washington (Dulles). Swissair operates one-stop service (via Singapore) between Zurich and Ho Chi Minh City, three days a week.

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

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

With three opportunities available, there is little question that Delta should receive a designation and seven frequencies to operate its proposed pattern of daily service to Vietnam. Delta is the only carrier that would offer daily nonstop-to-onestop connections to Vietnam from 11 U.S. gateways.  Delta will provide nonstop-to-onestop connections, via Paris, between eleven U.S. gateway cities and Ho Chi Minh City and Hanoi. The U.S. gateway cities are: Atlanta, Boston, Cincinnati, Dallas/Ft. Worth, Los Angeles, New York, Miami, Chicago, Philadelphia, Washington, D.C. and San Francisco. Air France's onward services from Paris would involve a single additional intermediate stop in Bangkok. 

Counsel: Shaw Pittman, Robert Cohn, 202.663.8060

As stated in its application, as amended, Northwest requests seven of the available frequencies. Northwest proposes to serve Ho Chi Minh City and Hanoi from a total of 15 U.S. gateways, via both transpacific routings and transatlantic routings. Northwest plans to codeshare on four weekly roundtrip flights operated by Malaysia Airlines ("MAS") between Ho Chi Minh City and Kuala Lumpur and on three weekly roundtrip flights operated by MAS between Hanoi and Kuala Lumpur. The MAS code-share service between Vietnam and Kuala Lumpur will connect at Kuala Lumpur with Northwest, MAS, and KLM Royal Dutch Airlines ("KLM") service, as described herein. Northwest proposes to provide this service on a year round basis.

Counsel: Northwest, Megan Rae Rosia, 202.842.3193, megan.rosia@nwa.com 

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

U.S.-Vietnam Third Country Code Sharing Opportunities

Delta Air Lines, Inc. ("Delta") and Northwest Airlines, Inc. ("Northwest") jointly move the Department to bring this case to an immediate conclusion by awarding one Vietnam third-country codeshare opportunity and seven frequencies to each of the three remaining applicants. Delta and Northwest (the "Joint Movants") further move the Department to toll the answer and reply dates established by Order 2001-5-27, until, respectively, seven and fourteen days after the Department rules on this Joint Motion, should further proceedings prove necessary.'

Counsel:  Northwest, Megan Rae Rosia, 202.842.3193, megan.rosia@nwa.com and Delta and Shaw Pittman, Robert Cohn, 202.663.8060

U.S.-Vietnam Third Country Code Sharing Opportunities

In their joint motion, Delta and Northwest urge that the Department stay the procedural dates established by Order 01-5-27 pending a decision on the issues raised in the joint motion. United concurs in that portion of the joint motion. In the event the Department decides not to stay those procedural dates, United requests that this answer be deemed to be United's answer to the applications of Delta and Northwest as supplemented on June 1, 2001, pursuant to the procedural schedule of Order 01-5-27.  United applied for 21 frequencies and Delta and Northwest for seven each. In each case, these applications were based on the total number of frequencies each applicant's selected code-share partner(s) operated to/from Vietnam.  

In their motion, Delta and Northwest urge that their frequency allocation applications be granted in full but that United's be reduced by 2/3 so that each applicant would receive seven frequencies. United strongly opposes that aspect of the joint motion. That proposal works well for Delta and Northwest, since they would receive everything they asked for, and, in fact, everything that they could use with their code-share partners. Unfortunately, while this proposal succeeds for Delta and Northwest, it would seriously shortchange the traveling public because it would preclude United from offering a daily pattern of service to Ho Chi Minh City, by far the largest U.S.-Vietnam market, via both a transatlantic and transpacific routing. The joint proposal of Delta and Northwest would also result in the relative waste of six frequencies since they would each offer three weekly services to the much smaller Hanoi market.

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

U.S.-Vietnam Third Country Code Sharing Opportunities

United has persisted in its unjustified request for a disproportionate share of Vietnam codeshare frequencies, and its answer argues that United is deserving of nine or more of the 21 available codeshare frequencies. United's unmerited demands have not only slowed the carrier selection process, but also will further delay the introduction of valuable new Vietnam codeshare services by U.S. carriers to the traveling public. United has provided no legitimate justification for indulging its excessive request, and such an award would only serve to limit the competitive value of daily services by Delta and Northwest.

Counsel:  Shaw Pittman, Robert Cohn, 202.663.8060 

United's arguments in support of its request are weak. Although United argues that its request for nine frequencies would produce greater public benefits, its request actually would produce less competition and fewer competitive benefits than would the equitable arrangement set forth in the Joint Motion. That arrangement would ensure balanced U.S. flag competition in the U.S.-Vietnam market between three strong U.S. carriers. Indeed, in the 2000 U.S.-Turkey Third Country Codeshare Opportunities case, the Department concluded that an equitable, balanced allocation of 21 frequencies among three carriers, such as that proposed in the Joint Motion, was in the public interest, Order 2000-8-17. Under United's new request, however, United would have 50 percent more U.S.-Vietnam frequencies than Northwest and Delta. While this may be an improvement over United's prior request for 100 percent of the frequencies (and United no doubt hopes that the Department will view it from that perspective), it promises less competition than would result if the Joint Motion were granted.

Counsel:  Northwest, Megan Rae Rosia, 202.842.3193, megan.rosia@nwa.com 

U.S.-Vietnam Third Country Code Sharing Opportunities

In their Joint Motion, Delta and Northwest correctly noted that there is no need for further comparative proceedings and that there is more than enough evidence in the record to support the equitable allocation proposed in the Joint Motion, without further answers and replies. In its June 13 reply, Delta repeated this position. Delta stated that "the Department should bring this case to a rapid conclusion by allocating seven frequencies to each applicant" and that "[flhere is no reason to award any of the three applicants less than seven of the 21 available frequencies.  Unfortunately, Delta did not stop there. Despite unequivocally endorsing the relief requested in the Joint Motion, Delta also stated that, if the Department decides to award more than seven frequencies to United, the Department should reduce Northwest's award and not Delta's. In support of this alternative, Delta asserted that its service proposal is superior to Northwest's.

Delta cannot have it both ways. In the Joint Motion, Delta proposed the equal allocation of frequencies and correctly asserted that further comparative pleadings and analysis are unnecessary. In an effort to hedge its position in case the Department denies the motion, Delta asks the Department to make just such a comparison. These opposing positions are untenable. If the Department grants the Joint Motion - and Northwest and Delta both urge the Department to do so - then Delta's "fall-back" position is moot. If the Department denies the motion, then further comparative pleadings presumably will be filed, as contemplated by the Department's Order 2001-5-27 reopening this proceeding. There is certainly no basis in the record for adopting Delta's "fall-back" position, and the Department should give that position no weight.

Counsel:  Northwest, Megan Rae Rosia, 202.842.3193, megan.rosia@nwa.com 

U.S.-Vietnam Third Country Code Sharing Opportunities

By this order, we tentatively award Delta Air Lines, Inc.. Northwest Airlines. Inc.. and United Air Lines. Inc. seven weekly frequencies each for U.S.-Vietnam third-country code-sharing services. We will afford interested parties 10 calendar days to comment on our tentative decision.

The U.S.-Vietnam market has been effectively closed to U.S. carrier service for a number of years. We now have the opportunity for three U.S. carriers to have limited access to this developmental market and believe it is important that the public be afforded the full variety of opportunities that multiple carrier service can offer. Under these circumstances, we tentatively conclude that the public interest would be best served by awards that allow each U.S. carrier to begin competition from a common base of frequencies, and by not emphasizing one Vietnamese city over another. Therefore, we are not convinced that United's Ho Chi Minh City-only proposal for nine weekly frequencies outweighs the service proposals of the other two applicants. Specifically, we are not persuaded that the asserted desire on United's part to secure daily service to Ho Chi Minh City over both transatlantic and transpacific routings carries such substantial public interest weight as to outweigh the public interest of opening service to Vietnam on an equal footing. We believe that in the circumstances presented, the three applicant carriers should have an equal opportunity to enter and develop the newly reopened Vietnam market with their code-share partners. Therefore, we tentatively conclude that each of the U.S. carrier applicants should receive seven weekly frequencies for third-country code-share opportunities in the U.S.-Vietnam market.

We propose that the code-share participants initially should be those partners as stated in the applications before us. The applicants would be free, however, to expand their code-sharing partners through use of the 30-day notification process, where applicable, provided such services are operated within the frequencies allocated. We further propose that the frequencies tentatively allocated here be subject to the standard code-share conditions, in particular the 30-day notice requirement specifying cities of operation and, in this case, code-share partners as well, since two of the applicants have more than one partner. Furthermore, we propose that these frequencies be subject to the standard dormancy condition which provides that any frequencies not operated for a period of 90 days will automatically return to the Department for reallocation. To this extent, we would provide that the 90-day dormancy period would begin on the date of service of a final order in this case.

In addition to the frequency allocation, we propose to award Delta and Northwest the exemption authority they need to operate their respective proposed services. 12 Since United already holds certificate authority for services between the United States and Vietnam, we would simply award it the frequency allocation.

By:  Susan McDermott

U.S.-Vietnam Third Country Code Sharing Opportunities

This is to advise you that Delta Air Lines, Inc., Northwest Airlines, Inc., and United Air Lines, Inc., have reviewed the Department's Show-Cause Order in the above-referenced proceeding (Order 01-8-8) and have determined that they will not be filing objections to the tentative findings and conclusions in that order. In these circumstances, Delta, Northwest and United jointly urge that a final order be issued immediately confirming the tentative findings and conclusions in Order 01-8-8 so that each of the carriers may proceed with plans to implement code-share services to Vietnam.

Counsel:  Shaw Pittman, Robert Cohn, 202.663.8060, robert.cohn@shawpittman.com Wilmer Cutler, Jeffrey Manley, 202.663.6670, jmanley@wilmer.com and Northwest, David Mishkin

U.S.-Vietnam Third Country Code Sharing Opportunities

By this order, we make final our tentative findings and conclusions in Order 2001-8-8 and award Delta Air Lines, Inc., Northwest Airlines, Inc., and United Air Lines, Inc. seven weekly frequencies each for U.S.-Vietnam third-country code-sharing services and grant the necessary regulatory authority for the carriers to conduct their respective code-share services.

By:  Susan McDermott

U.S.-Vietnam Third-Country Code-Sharing Opportunities

United Air Lines, Inc. ("United") hereby applies for a waiver of the 90-day dormancy condition with respect to two of United's seven weekly U.S.-Vietnam thirdcountry code-share frequencies which United plans to use to offer code-share service to Ho Chi Minh City via Tokyo in conjunction with All Nippon Airways Co., Ltd. ("ANA"). Because of technical problems affecting the ability of ANA's reservation system to process bookings on United's code-share service to Vietnam, United requests a waiver of the dormancy condition in order to allow time for ANA and United to resolve these problems. United will poll the U.S. carrier applicants in this proceeding and will advise the Department of their responses.

United and ANA had hoped to begin the code-share service within a time frame consistent with the dormancy condition imposed by Order 2001-8-21. Unfortunately, United and ANA have encountered technical problems that must be resolved before the service commences. In particular, at present ANA's reservations system in unable to accept or process bookings for United's code-share service to Vietnam on ANA flights between Tokyo and Ho Chi Minh City. United and ANA personnel are working diligently to resolve this problem, but it cannot be resolved before the November 20, 2001 dormancy deadline.

Absent implementation of service or a waiver of this dormancy condition, the two frequencies United intends to use for code-share service to Vietnam via Tokyo will revert to the Department effective November 21, 2001.  United's code-share service via Bangkok in conjunction with Thai Airways will be offered five days per week commencing November 17, 2001, consistent with Vietnam approval.

United seeks at least a 90-day waiver of the dormancy condition applicable to two of its U.S.-Vietnam frequencies. This waiver should enable ANA and United to develop a satisfactory solution to the problem. If necessary, however, in the unlikely event that a timely solution is not achieved, United will revise its service plans and seek to amend its Vietnam approval to permit operation of all seven frequencies via Bangkok with Thai Airways. United's frequency allocation, as granted by Order 2001-8-21, is not limited to specific intermediate points or code-share partners and provides the flexibility to make such adjustments subject to the appropriate notification to the Department 30 days in advance.

Counsel:  United and Wilmer Cutler, Jeffrey Manley, 202-663-6670

U.S.-Vietnam Third Country Code Sharing Opportunities

We have polled all U.S. carrier applicants in the above referenced proceeding on the Application of United Air Lines, Inc. for Waiver of Dormancy Condition filed November 13, 2001. All such parties have advised us that they have no objection to the granting of a waiver of the dormancy condition applicable to two of United's U.S.-Vietnam third-country code-share frequencies as requested in that application.

Counsel: Wilmer Cutler, Jeffrey Manley

U.S.-Vietnam Third-Country Code Sharing Opportunities

Counsel:  Delta and Shaw Pittman, Robert Cohn

Counsel:  Northwest, Megan Rosia

U.S.-Vietnam Third Country Code Sharing Opportunities; Delta Air Lines, Inc., Northwest Airlines, Inc., and United Air Lines, Inc.

United, Delta, and Northwest have applied for waivers from the 90-day dormancy condition with respect to combination service frequencies awarded to the carriers by Order 2001-8-21 for U.S.-Vietnam third-country code-share services. Specifically, United requests a waiver effective for a period of not less than 90 days for two of the seven weekly frequencies it was awarded to provide third-country U.S.-Vietnam code-share services with All Nippon Airways (ANA) to Ho Chi Minh City via Tokyo.' United states that it needs time to resolve technical difficulties affecting ANA's reservations system. Delta requests a waiver for all seven of its frequencies effective for a period of 90 days to allow additional time for Delta and Air France to finalize service implementation plans. Northwest also requests a 90-day waiver from the dormancy condition for all seven of its frequencies. Northwest states that it plans to implement its third-country code-share service to Vietnam with KLM and Malaysian Airlines effective December 1, 2001, or as soon thereafter as Northwest receives the necessary foreign operating authority from the Government of Vietnam. Absent a waiver of the 90-day dormancy condition, the frequencies awarded to the carriers by Order 2001-8-21 would revert to the Department on November 21, 2001.

United indicates that its third-country code-share service to Vietnam via Bangkok in conjunction with Thai Airways is scheduled to be offered five days a week beginning November 17, 2001. Delta notes that it has a separate blanket dormancy waiver request pending in Docket OST-2001-10781. In the event that the Department does not act on that application prior to November 21, 2001, Delta has requested the specific waiver at issue here. The waivers from the dormancy condition are effective until February 19, 2002, or until the date on which the carriers begin service using the frequencies, whichever occurs earlier. If the carriers do not begin service by February 19, 2002, then the frequency allocations expire automatically.

By:  Paul Gretch

U.S.- Vietnam Third Country Code Sharing Opportunities

Pursuant to Order 2001-8-21 issued August 23, 2001, in the referenced proceeding, United Air Lines, Inc. hereby gives the Department notice of its intention to transfer one of its U.S.-Vietnam third-country code-share frequencies, which is currently being used in conjunction with Thai Airways via Bangkok, to services operated by All Nippon Airlines via Tokyo. Beginning on April 18, 2002, United will be code sharing on four weekly flights operated by Thai between Bangkok and Ho Chi Minh City and on three weekly flights operated by ANA between Tokyo and Ho Chi Minh City.

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

U.S.-Vietnam Third-Country Codesharing Opportunities; American Airlines, Inc.

Hereby applies for an exemption under 49 USC 40109 authorizing foreign air transpor­tation of persons, property, and mail between points in the United States and points in Vietnam, with the right to inte­grate such authority with American's certificates of public convenience and necessity and other exemptions. American further applies for a U.S.-Vietnam third-country codeshare opportunity and allocation of six weekly frequencies. American will use this authority to serve the U.S.-Vietnam market via Tokyo under its codesharing arrangement with Japan Airlines.  American proposes to place the "AA" designator code on JAL's Tokyo-Vietnam flights in order to carry U.S.-Vietnam passengers connecting at Tokyo from American's and JAL's U.S. gateways.

Counsel:  American, Carl Nelson, 202.496.5647, carl.nleson@aa.com

U.S.- Vietnam Third-Country Codesharing Opportunities; American Airlines, Inc.; and Delta Air Lines, Inc.; United Air Lines, Inc.

Hereby answers in opposition to the Application of American Airlines, Inc. for an allocation of six weekly third-country codeshare frequencies to serve Vietnam in conjunction with Japan Air Lines. Delta has today filed a competing application, seeking six frequencies to provide third-country service to Vietnam with Korean Air Lines. Delta opposes American's application to the extent it would preclude the proposed services by Delta and KAL.

American has announced a bilateral codeshare and marketing alliance with Vietnam Airlines, the state-sponsored flag carrier of Vietnam. American/Vietnam Airlines codeshare services are expect to begin later this year, "once the carriers have received government approvals and have worked out operational details.” The proposed services are comprehensive in scope, and will be offered via the very same Tokyo intermediate gateway that American proposes to serve with JAL, as well as transatlantic routings via Paris, and other gateways in Asia.

Counsel:  Shaw Pittman, Robert Cohn, 202.663.8060, robert.cohn@shawpittman.com

Northwest opposes American's application. The six frequencies requested by American are among the seven frequencies originally allocated by the Department to Northwest for code­share service to Vietnam with Malaysia Airlines and KLM. See Order 2001-8-21. Northwest's use of those frequencies was delayed by a combination of circumstances not within the control of Northwest. Those circumstances have now been satisfactorily resolved, however, Northwest and the other carriers (United Air Lines and Delta Air Lines) that were awarded frequencies under Order 2001-8-21 received waivers through March 31, 2002, of the 90-day dormancy conditions applicable to the frequencies (Notice of Action Taken, November 19, 2001, Docket OST-2000-7194, and Order 2001-11-15, Docket OST-2001-11065). Northwest was unable to implement service by the April 1, 2002 deadline established by Order 2001-11-15.

Counsel:  Northwest, Megan Rae Rosia, 202.842.3193, megan.rosia@nwa.com 

In circumstances where there are seven frequencies available, the applications of American and United are not mutually exclusive and both can be granted. United has no objection to the application of American for six frequencies so long as its grant does not preclude the grant of United's application for the seventh frequency. Because United is already designated for and offering U.S.-Vietnam third­country code-share service, its request for a single frequency should be granted immediately. United is prepared to start using this seventh frequency on July 3, 2002, when ANA begins to operate its fourth weekly service between Tokyo Narita and Ho Chi Minh City, Vietnam.

As noted in its contemporaneous application, however, United objects to any third-country code-share frequencies being allocated to or retained by American if and when that carrier is authorized to implement its announced code share with Vietnam Airlines.

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

Hereby applies for an allocation of six (6) Vietnam codeshare frequencies. Delta intends to use this authority to conduct third-country codeshare services to Vietnam via Seoul in conjunction with Korean Air Lines, Delta's transpacific codeshare and alliance partner.  Together, Delta and KAL would offer new nonstop-to-nonstop Vietnam connections from the following nine U.S. gateway cities: Atlanta, Anchorage, Chicago, Dallas/Ft. Worth, Honolulu, Los Angeles, New York, San Francisco, and Washington, D.C. The vast array of connecting services offered by Delta at its major connecting hubs and international gateways will provide travelers located in virtually every U.S. city with new routing and schedule choices to Vietnam.

Under the March 3, 2000 Memorandum of Discussions between the Government of the United States and the Government of Vietnam, a total of 21 codeshare frequencies are available for use by U.S. carriers. By Order 2001-8-21, the Department allocated all 21 frequencies. However, the seven frequency allotment previously granted to Northwest has now lapsed for dormancy.  Delta proposes to make immediate use of the available dormant frequencies by placing its code on KAL's six weekly flights between Seoul and Vietnam. The service would operate three times a week to Ho Chi Minh City, and three times a week to Hanoi, providing a balanced and well-rounded transpacific schedule serving two of Vietnam's most important cities.

Counsel:  Shaw Pittman, Robert Cohn, 202.663.8060, robert.cohn@shawpittman.com

Commencing on or before July 1, 2002, Northwest plans to display the NW designator code on daily round-trip flights operated by MAS between Kuala Lumpur and Ho Chi Minh City. This service will connect with the roundtrip services between Kuala Lumpur and Amsterdam operated by MAS (daily round-trip service) and KLM (currently five weekly round­trip flights), all of which will also display the NW designator code. 1 These flights, in turn, will connect with the service offered by Northwest/KLM between Amsterdam and 13 geographically dispersed U.S. gateways.

An increase in MAS's Kuala Lumpur-Ho Chi Minh City service to daily will allow Northwest, in turn, to offer daily service to Ho Chi Minh City. Northwest considers this to be a service improvement, as Ho Chi Minh City is Vietnam's principal economic center. Northwest's use of the seven frequencies originally allocated to it was delayed by a combination of circumstances not within the control of Northwest. ³ Those circumstances have now been satisfactorily resolved, and Northwest and MAS are prepared to immediately implement code-share service to Ho Chi Minh City via Kuala Lumpur, pending approval by the Department of this application.

Counsel:  Northwest, Megan Rae Rosia, 202.842.3193, megan.rosia@nwa.com

Respectfully requests the allocation of one (1) additional U.S.-Vietnam third-country code-share frequency under the U.S./Vietnam Memorandum of Discussions dated March 3, 2000. United will use this frequency to support one additional U.S.-Ho Chi Minh City weekly frequency via Tokyo Narita in conjunction with a new NRT-SGN flight of All Nippon Airways, Inc., starting on July 3, 2002.

United presently holds an allocation of seven (7) weekly U.S.-Vietnam third-country carrier code-share frequencies. Orders 01-8-21 and 01-8-8. United uses those frequencies to offer three weekly U.S.-Ho Chi Minh City services via Tokyo Narita in conjunction with ANA and four weekly U.S.-Ho Chi Minh City services via Bangkok in conjunction with Thai Airways International.

In the event that American and Vietnam Airlines seek authority from the Department to code share with each other for U.S.-Vietnam traffic, United reserves the right to request reallocation of any third-country code-share frequencies that might be awarded to American to support its code share with JAL. To avoid an unfair retention of third-country code-share frequencies by American and to facilitate such a reallocation, any allocation of third-country code-share frequencies to American in this proceeding should be made on a temporary basis not to exceed 6 months or, in the alternative, should be limited to a period that would be set to expire 90 days after any DOT approval of a code share between American and Vietnam Airlines.  Even if American's request in this proceeding were granted in full, however, there would remain one unallocated frequency. United requests immediate allocation of that frequency and proposes to use it to start a fourth weekly code-share service to Ho Chi Minh City via Tokyo on July 3, 2002, when ANA increases its NRT­SGN services.

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

U.S.- Vietnam Third-Country Codesharing Opportunities; Delta Air Lines, Inc.; Northwest Airlines, Inc.; and United Air Lines, Inc.

Hereby amends it Application dated May 24, 2002, in the above-referenced proceeding to request a total of seven (7) U.S.-Vietnam third-country code-share frequencies. United will use those frequencies to offer service to points in Vietnam on additional flights operated by All Nippon Airways Co. Ltd. ("ANA") via Tokyo (1/weekly) and on flights operated by Thai Airways International Public Co. Ltd. via Bangkok (6/weekly).

In its May 24, 2002, application United requested one U.S.-Vietnam third­-country code-share frequency to start an additional weekly service to Ho Chi Minh City, Vietnam via Tokyo on July 3, 2002, when ANA will start an additional weekly service over that routing (total four weekly). United's request for one frequency was contingent on their being no need for carrier selection. American Airlines, Inchad requested six of the seven available frequencies and, by requesting only one, United hoped to obtain an expedited allocation of the one frequency for which American had not applied. Such expedition is important to United in circumstances where ANA is planning to add an additional flight on July 3, 2002. Because United's application for a single frequency was not mutually exclusive with American's application for six, it was hoped that the delay entailed by a carrier selection case could be avoided.

United will use the seven weekly frequencies that it now requests to offer an additional weekly code-share service to Ho Chi Minh City via Tokyo with ANA and six additional weekly code-share services to points in Vietnam via Bangkok with THAI. United's third-country code-share partners offer more frequencies to more points in Vietnam via more intermediate connecting points than any other third-country carrier/U.S. carrier partnership. United will demonstrate that, with its partners' broader and more varied service offerings, it can use the seven available third-country frequencies to offer greater public benefits than any other applicant.

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

With the addition of Delta and Northwest, there are now four applicants requesting a total of 26 U.S.-Vietnam frequencies for third-country code sharing. As there are only seven third-country code-share frequencies available for allocation, the applications are mutually exclusive with those of United and American Airlines, Inc. and a carrier selection proceeding will be necessary in order to resolve the issues they have raised.

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

U.S.-Vietnam Third-Country Codesharing Opportunities; American Airlines, Inc.; Delta Air Lines, Inc.; Northwest Airlines, Inc.; United Airlines, Inc.

Vietnam has not yet received a Category 1 rating from the Federal Aviation Adminis­tration, and until that occurs the American/Vietnam Airlines arrangement cannot go forward. In the meantime, American has no on-line access to the U.S.-Vietnam market. While American remains confident that the FAA will in due course certify Vietnam as a Category 1 country, American should be afforded the opportunity to serve Vietnam via Tokyo with Japan Airlines. When American and Vietnam Airlines are able to implement their arrangement, the Department can, if it wishes, reassess the competitive needs of the market at that time, including the service quality proposed by other applicants.

In that regard, there is no compelling reason why Delta (seeking to hold 13 of the 21 frequencies for service with Air France and Korean Airlines) and United (seeking to hold 14 of the 21 frequencies for service with Thai Interna­tional and ANA) should be favored over American's potential arrangements with Japan Airlines and Vietnam Airlines. Nor is there a public interest basis for Northwest -- proposing an arduous transatlantic routing involving connections at both Amsterdam and Kuala Lumpur and travel on up to three different carriers -- to be given favorable consideration.

Counsel:  American, Carl Nelson, 202.496.5647, carl.nelson@aa.com

Delta, Northwest, and United, in their answers to American's application submitted on May 24, 2002, cited American's announced but yet to be implemented codeshare arrangement with Vietnam Airlines as a reason to deny American's request. That line of argument should be rejected. Vietnam has not yet received a Category 1 rating from the Federal Aviation Administration, and until that occurs the American/Vietnam Airlines arrangement cannot go forward. In the meantime, American has no on-line access to the U.S.-Vietnam market. While American remains confident that the FAA will in due course certify Vietnam as a Category 1 country, American should be afforded the opportunity to serve Vietnam via Tokyo with Japan Airlines. When American and Vietnam Airlines are able to implement their arrangement, the Department can, if it wishes, reassess the competitive needs of the market at that time, including the service quality proposed by other applicants.

Counsel:  American, Carl Nelson, 202.496.5647, carl.nelson@aa.com

It is unnecessary for the Department to engage in a protracted carrier selection proceeding now, when it already has available all of the pertinent details on which it based its original allocation. Delta and United have third country codeshare partners and serve the market with seven frequencies each. American has superior access to the market through its codeshare alliance with Vietnam Airlines. Indeed, American withdrew from the original proceeding just a few short weeks before publicly announcing its new alliance with Vietnam Airlines. Reallocation of seven frequencies to Northwest will enable American, Delta, United and Northwest to each compete in the U.S.-Vietnam market and provide consumers with a full variety of opportunities that multiple carrier service can provide.

Counsel:  Northwest, Megan Rae Rosia, 202-842-3193, megan.rosia@nwa.com

U.S.-Vietnam Third-Country Codesharing Opportunities / American Airlines, Inc.

For the reasons explained in Delta's May 24, 2002 Answer, Delta should receive priority over American, given that carrier's extensive bilateral marketing alliance with Vietnam Airlines. American concedes that it "remains confident that the FAA will . . certify Vietnam as a category 1 country", thus permitting full implementation of the planned American/Vietnam Airlines codeshare alliance, originally slated to begin this year.

Of the remaining applicants, only United and Delta are proposing nonstop-to-nonstop service. Delta would offer six nonstop-to-nonstop codeshare frequencies, and United one. So long as Delta receives its full award of six frequencies, Delta would not object to United receiving the remaining frequency for its one-stop proposal. Delta opposes United's six additional double-connecting frequencies via Bangkok, which suffer from the same service deficiencies as Northwest.

Delta is fully prepared to demonstrate the superiority of its proposal in any However, such proceeding need not be elaborate or "protracted" as argued by Northwest. Indeed, given the overwhelming service superiority of Delta onestop proposal, and the competitive deficiencies of American's proposal in light of its bilateral arrangement with Vietnam Airlines, the Department may conclude that it already has sufficient information to make a decision on the basis of applications and responsive pleadings. If so, the Department should promptly issue an Order awarding Delta six frequencies.

Counsel:  Delta and Shaw Pittman, Robert Cohn, 202-663-8060

U.S.-Vietnam Third-Country Codesharing Opportunities

Pursuant to Order 01-8-21 issued August 23, 2001, in the referenced proceeding, United Air Lines, Inc. hereby gives the Department notice of its intention to transfer one of its U.S.-Vietnam code-share frequencies, which is currently being used in conjunction with Thai Airways via Bangkok, to services operated by All Nippon Airlines via Tokyo. Beginning on July 2, 2002, United will be code sharing on three weekly flights operated by Thai between Bangkok and Ho Chi Minh City and on four weekly flights operated by ANA between Tokyo and Ho Chi Minh City.

Order 01-8-21 does not by its terms require a notice in these circumstances because United is not adding a new partner or a new point. See Order 01-8-8 (providing for "use of the 30-day notification process, where applicable . . ."). Based on informal discussions with DOT staff, however, United previously agreed to provide a notice where it was transferring frequencies from one existing partner to another for service at the same point in Vietnam. Because the 30day notification requirement is not applicable, United's notice is timely filed.

Counsel:  Wilmer Cutler, Jeffrey Manley, 202.663.6000, jmanley@wilmer.com 

June 20, 2003

OST-00-7194 - US-Vietnam Third-Country Codesharing Opportunities

Application of Delta Air Lines for Renewal of Exemption

Delta utilizes its U.S.-Vietnam exemption authority to provide third-country codesharing service to Ho Chi Minh City and Hanoi via Paris in conjunction with Societe Air France. Such service is provided pursuant to seven weekly frequencies allocated indefinitely to Delta by Order 2001-8-21 and the Delta/Air France blanket codeshare authority granted on August 6, 1998 (Statement of Authorization #98-303).

Counsel: Shaw Pittman, Robert Cohn, 202-663-8060

June 23, 2003

Application of Northwest Airlines for Renewal of Exemption

Northwest seeks renewal of its exemption under 49 U.S.C. § 40109 authorizing Northwest to provide scheduled foreign air transportation of persons, property and mail between points in the United States and points in Vietnam. See Order 2001-8-21, Ordering Paragraph 4, (August 23, 2001, Docket OST-2000-7194). Northwest intends to serve the U.S-Vietnam market in conjunction with its codeshare partners Malaysia Airlines and KLM Royal Dutch Airlines upon receipt of necessary third country codeshare authority under the U.S.-Vietnam Air Services Agreement.

Counsel: Northwest, Megan Rosia, 202-842-3193, megan.rosia@nwa.com

July 7, 2003

OST-00-7194 - US-Vietnam Third-Country Codesharing Opportunities

Consolidated Answer of United Air Lines

United has requested renewal of its certificate authority to serve Vietnam on several occasions. Application of United Air Lines For Certificate Renewal, dated May 7, 2002, Dockets OST-96-1873; OST-96-1248, and OST-96-1131; Application of United, dated October 16, 1996, Docket OST-96-1873; Application of United, dated May 25, 1990, Docket 46960. Each time it has applied, however, the Department has withheld renewal and has instead inserted a cryptic notation in the order that grants renewal to other limited-entry route authorizations contained in the same certificate.

United has no objection to the renewal of the temporary authority under which Delta or Northwest are authorized to serve Vietnam so long as United's own temporary authority is renewed at the same time. United has filed a pending application to renew temporary route authority in its Certificate of Public Convenience and Necessity for Route 130. In that application, United specifically requested renewal of its authority to serve Vietnam based on the changed circumstances since that renewal had last been deferred in 1992.

United joins with Northwest in urging that the Department start its review process of American's third-country code-share frequency allocation. That process should be begun now so that there is no overlap between American's frequency-limited code-share services with JAL and its unlimited code-share services with Vietnam Airlines once American is prepared to implement its unrestricted service with Vietnam Airlines.

Counsel: Wilmer Cutler, Jeffrey Manley, 202-663-6670

US-Vietnam Codesharing

Order 03-12-16
OST-02-12496 - US-Vietnam Third-Country Codeshare Opportunity
OST-00-7194 - US-Vietnam Third-Counry Codesharing Opportunities

Issued December 15, 2003 | Served December 18, 2003

Order Amending Orders

The recent Agreement with Vietnam and the Agreement's liberal provisions for code sharing frequencies and arrangements change the circumstances that existed at the time we made our previous allocations. Therefore, we have decided to grant American's motion and United's request to remove the limits deriving from our previous allocation determinations under the MOD regarding weekly U.S.-Vietnam code-sharing frequencies for those carriers authorized to perform code-share operations to Vietnam.

The changed circumstances, however, do not warrant changes in certain of our other requirements. Specifically, our standard blanket code-share conditions require U.S./foreign air carriers to give 30-day advance notification to the Department of new code-share services. We also have required U.S. carriers having multiple code-share partners for code-sharing services to Vietnam to give advance notification or to secure separate authorization of the code-share partner for the services offered. Nothing in our present action is intended to eliminate our requirements in this regard.

We grant the motion of American Airlines and the request of United Air Lines in Docket OST-2002-l2496, and amend Orders 2001-8-21 and 2002-10-8 to remove the frequency limits for operations of U.S.-Vietnam code sharing and to reflect the fact that there no longer exist cooperative arrangement limits for code-sharing operations between the two countries.

By: Michael Reynolds

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