OST-95-317
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OST-95-317
OST-95-317 | August 5, 1997
While Arrow has been permitted most of the extra sections flights it has requested from the Peruvian government, there is no guarantee that this situation will continue. If Peru were to unilaterally decide, for whatever reason, to cease permitting these extra-section flights, it would produce severe disruption for Arrow's shippers in this market. Furthermore, Arrow cannot advertise service in the market that exceeds its allocation. The net result of the Department's decision to withhold three weekly frequencies, coupled with Millon's suspension of operations, is that there are at present five weekly all-cargo frequencies unused in one of the most restricted U.S.-South America markets, while Arrow has had to rely on extra-bilateral authority from the Peruvian government to meet the demand from its shippers.
Arrow has become increasingly concerned that the Department's policy in recent proceedings has been to "spread" all-cargo authority in restricted South America markets among multiple carriers rather than awarding sufficient authority to a more limited number of carriers to enable them to compete effectively with each other by offering frequent service to shippers. While it may be perceived that this policy offers the greatest benefits to shippers, even in markets where one carrier holds a substantial advantage over its competitors, the ability of those competitors to mount and sustain reliable competitive service is greatly compromised. In the case of both Ecuador and Peru there is one U.S. carrier which holds a significant plurality of the weekly frequencies. In the Ecuador market Challenge Air Cargo (Challenge) holds seven frequencies; no other carrier has more than three. In Peru, again Challenge holds five weekly frequencies, while no other U.S. carrier has more than two. When one carrier can offer daily or near daily service, while each of its competitor holds less than fifty percent of that frequency authority, the lack of competitive parity is obvious.
Counsel: Allan Markham, 202-337-2149
Millon Air, Inc. (Renewal of Frequency Allocation, US-Peru Scheduled All-Cargo)
OST-95-317 | August 8, 1997
Request for Renewal of Frequency Allocation and Additional
Frequencies
Due to an unfortunate crash in Ecuador in October 1996, Millon Air's aircraft were voluntarily grounded for inspection and in depth records review by FAA, and consequent re-fitness determination by the Department pursuant to 14 CFR 204.7. FAA's review was successfully completed, and satisfactory completion of the DOT review is imminent. Millon Air did commence U.S.-Peru service prior to the crash, and intends to recommence at a minimum twice weekly service as soon as the DOT re-fitness review is complete.
Millon Air also respectfully requests allocation of the three frequencies which came available for use November 1, 1996. As stated in previous submissions in this proceeding, because shippers prefer the convenience of daily weekday service, five frequencies is the minimum necessary to mount a service which is truly competitive with that offered by incumbent Challenge Air. Upon reestablishing operations, Millon Air is willing and will be able to accommodate that level of service with the B707 it has on hand, and if necessary additional leased aircraft which are readily available.
Counsel: Bernstein Matthews, Suzette Matthews, 540-364-3470
U.S.-Peru All-Cargo Service Proceeding
OST-95-317 | August 13, 1997
To the extent that the Department is inclined to grant the three reserved frequencies (and any unused frequencies, if they are available), it should not do so without considering the other applications in this proceeding and without considering the impact of the existing services on the U.S.-Peru market. The Department deferred allocating three frequencies in this proceeding, so that it could review the impact of the new services upon the U.S.-Peru market. Order 96-10-2, at 5. The Department, moreover, pledged that it would institute the appropriate procedures "to allocate the remaining frequencies." Challenge cannot believe that the Department envisioned allocating the three reserved frequencies on one or two carriers' applications. Rather, to adequately and fairly consider existing services in and demands of the U.S.-Peru market, the Department should institute a new proceeding. Challenge was an applicant in the prior U.S.-Peru all-cargo service proceeding and expects to be an applicant in any future frequency allocation proceeding.
Counsel: Zuckert Scoutt, William Callaway, 202-298-8660
OST-95-317 | August 15, 1997
First Addendum to Application and Answer of Arrow Air
In allocating the U.S.-Peru frequencies in this Docket the Department imposed its standard 90-day dormancy provision on all U.S. all-cargo carriers in the market. Since Millon has not operated since October 1996, over nine months ago, its U.S.-Peru frequencies automatically reverted to the Department long ago. Therefore, the two weekly frequencies formerly held by Millon are currently available for reallocation, irrespective of the outcome of Millon's current fitness investigation or the timing of its subsequent return to operations. Likewise, its pending application in this Docket must be dismissed.
Counsel: Allan Markham, 202-337-2149
U.S.-Peru All-Cargo Frequencies
OST-95-317 | August 19, 1997
Motion for Leave to File and Answer of Fine Air
Services
Fine Air urges the Department (i) to issue notice to and accept applications from all carriers interested in serving the U.S.-Peru all-cargo market at the appropriate time before allocating newly available or dormant frequencies; and (ii) disqualify Millon Air from renewing or seeking the allocation of new frequencies.
Counsel: Wilmer Cutler, Jeffrey Shane, 202-663-6000
U.S.-Peru All-Cargo Service Proceeding
OST-95-317 | August 21, 1997
Application of Florida West International Airways
for Allocation of Additional Frequencies
FWIA's Peru services have been extremely well-received by shippers, even though FWIA is limited currently to only two weekly flights. From April 8 through July 30, 1997, FWIA's DC-8-61 Peru flights have carried slightly more than 2.3 million pounds in the southbound direction and 820,000 pounds in the northbound direction. The 3.1 million pounds of freight carried by FWIA in just three and one half months includes the volumes transported on the occasional third weekly flight. Importantly, even though the U.S.-Peru cargo market is seasonal and highly directional, with the volume of southbound cargo generally exceeding that flowing north, FWIA has been gradually developing and increasing its northbound cargo levels. For July 1997, northbound cargo was approximately eighty percent of the level of southbound cargo, substantially increasing the profitability of FWIA's services. FWIA expects to sustain this trend and intends to continue to make every effort to further increase its northbound cargo levels.
Counsel: Squire Sanders, Marshall Sinick, 202-626-6651
Order 98-4-9 | 41480 | 46515 | 48367 | OST-95-317 | OST-96-2012 | Issued and Served April 9, 1998
Order Revoking Certificates and Dismissing Application
By this order, we are dismissing the application to resume air transportation operations filed by Millon Air, Inc. (Millon) in Docket OST-96-2012, and revoking the carrier's interstate and foreign scheduled and charter certificates for reason of dormancy. Millon filed information detailing actions it had taken or planned to take in an effort to address our fitness concems. More recently, in October 1997, the carrier orally advised us that it had been sold and that infomnation relative to its new ownership would be forthcoming. No such infomnation was filed, and in early January of this year, we were advised that this sale had fallen through, but that Millon was pursuing other purchase offers. Since early February, however, we have received no information concerning an actual or potential sale of the carrier, nor do we have any other information indicating that Millon has any plans to resume operations in the foreseeable future. We also expect that much of the infommation previously filed in support of the carrier's fitness is no longer valid.
Attachment A - Service List
By: John Coleman
Millon Air, Inc. (Revocation of Interstate/Foreign Charter Certificates / Exemption from 45-Day Notice)
OST-95-317 | OST-96-2012 | April 16, 1998
Petition for Review of the Order Revoking Certificates and
Dismissing Application
Consistent with the Department's rules, on December 10, 1996 Millon filed notice with the Department that it intended to resume operations and supplied information relative to its fitness. Extended discussions were undertaken between Millon and the Department in Docket OST-96-2012. In October of 1997 the carrier in fact advised DOT that it had been sold and information relative to its new ownership would be filed pursuant to the Department's regulations. Subsequent to that notice the sale was not consummated and the prospective new owners of the airline proved to have no money and no ability to consummate the transaction from the inception. The matter has been referred to law enforcement for investigation and prosecution. Subsequent to that time, Millon Air's owners have been engaged in discussion with potential purchasers of the airline. At present time, two groups are jointly in detailed discussions with Millon concerning the purchase of the stock of the carrier. Based upon the most current discussions it is anticipated that these discussions will result in a Purchase and Sale Agreement for the stock sometime within the next sixty (60) days. Based on the foregoing new information, not before the Department when its decision was made, it is the request of the Millon family, owners of Millon Air, Inc., that it be given an opportunity to continue these negotiations for the potential sale of Millon Air, Inc.
Counsel: Dow Lohnes, Jonathan Hill, 202-776-2000
Millon Air, Inc. (Revocation of Interstate and Foreign Certificate/Waiver of 45-Day Notice/Redetermination of Fitness)
Order 98-6-4 | 41480 | 46515 | 48367 | OST-95-317 | OST-96-2012 | Issued and Served June 5, 1998
Order Staying Revocation of Certificate
Thus, we have decided to stay the revocation of the carrier's domestic all-cargo certificate (and delay issuance of any orders revoking the carrier's foreign cargo authority) for a period of 60 days from the date of this order. If, within this 60-day period, Millon does not provide us with current information supporting its fitness, we will issue an order reinstating the revocation of the carrier's domestic authority in Order 98-4-9, and will proceed to issue an order revoking its foreign certificate authority.
By: John Coleman
Order 98-8-24 | 41480 | 46515 | 48367 | OST-95-317 | Issued and Served August 20, 1998
Order Lifting Stay and Revoking Certificates
We will lift the stay granted by Order 98-6 4 and make final the revocation of the carrier's certificate authority. This action is taken without prejudice to Millon's filing a new application for authority at some future date should it choose to do so.
Attachment A: Service List
By: Charles Hunnicutt
Order 98-8-24 - Correction
By: John Coleman
| Order 98-10-20 46515 48367 OST-95-317 |
Issued and Served October 20, 1998 | Order Revoking Foreign Certificates |
Revocation of Foreign Scheduled and Charter Air Transportation Certificates |
By: Charles Hunnicutt
| OST-95-317 | Filed August 4, 1997, Supplemented August 15, 1998 / Action Taken November 5, 1998 | Notice of Action Taken |
Houston/Miami-Lima/Iquitos All-Cargo Scheduled |
Scheduled foreign air transportation of property and mail between the coterminal points Houston, Texas, and Miami, Florida, and the coterminal points Lima, and Iquitos, Peru
By: Paul Gretch
Order Isuing Certificates / Continental airlines, Inc. Continental airlines, Inc. and Continental Express, Inc., Continental Micronesia, Inc., Florida West International Airways, Inc., Millon Air, Inc., United Parcel Service Co., USAir, Inc.
| Order 99-2-28 OST-96-1485 OST-96-1080 OST-97-3092 Undocketed Undocketed OST-96-1198 OST-96-1202 OST-95-317 OST-95-317 OST-96-1492 OST-96-1287 |
February 26, 1999 |  Order Issuing Certificates |
For certificates, exemptions or other authorities or relief under 49 U.S.C. sections 41102 or 40109 and regulations of the Department of Transportation. |
By: Paul Gretch
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