ost961913 - Order Rescinding Frequency Allocation and to Show Cause

OST Filings by Docket Number

U.S.-Ecuador All-Cargo Frequencies / American International Airways, Inc. / Arrow Air, Inc. / Challenge Air Cargo, Inc. / Fine Airlines, Inc. / Florida West International Airways, Inc. / Polar Air Cargo, Inc. / Millon Air, Inc.

Order 97-7-14 | OST-97-2711 | OST-97-2342, 97-2492, 97-2443, 97-2423, 97-2325, 97-2444 | OST-96-1913 | Issued and Served July 14, 1997

Order Rescinding Frequency Allocation and to Show Cause

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By this order, we rescind the allocation of frequencies to Millon Air for US-Ecuador services and we tentatively (1) grant American International Airways an exemption to perform scheduled foreign air transportation of property and mail between Miami and Quito and Guayaquil, and to integrate this authority with the carrier’s certificate authority to serve points in Colombia and (2) allocate AIA three US-Ecuador all-cargo frequencies for these services for a one-year period. In addition, we propose to condition the frequencies tentatively allocated here, as well as frequencies allocated to incumbent carriers, with our standard 90-day dormancy rule. We dismiss the request of Millon Air for renewal of its frequency.

Appendix A – Ecuador Applications | Appendix B – Summary of Responsive Pleadings

By: Patrick Murphy

U.S.-Ecuador All-Cargo Frequencies / American International Airways, Inc. / Arrow Air, Inc. / Challenge Air Cargo, Inc. / Fine Airlines, Inc. / Florida West International Airlines, Inc. / Polar Air Cargo, Inc. / Millon Air, Inc.

OST-97-2711 | OST-97-2342, 97-2492, 97-2443, 97-2423, 97-2325, 97-2444 | 96-1913 | July 24, 1997

Objection Fine Airlines

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With the Department's decision to reallocate Millon's three frequencies, Fine Air had expected at last to overcome that disadvantage by being placed on an equal footing, at a minimum, with its incumbent competitor, Arrow. Although Fine Air understands the constraints that necessarily govern operations in a frequency-controlled market, it had expected that proven performance over a sustained period would qualify it for at least a modest expansion when the opportunity to allocate additional frequencies arose. The Department had the wherewithal in this proceeding to make that modest expansion possible while still adding a new entrant carrier to the market with the same number of frequencies that have enabled Fine Air to sustain a competitive presence from the time it too was a new entrant.

Counsel: Wilmer Cutler, Jeffrey Shane, 202-663-6000

Petition for Reconsideration and Objections of Millon Air

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Withdrawing Millon Air's allocation when the airline is poised to recommence U.S.-Ecuador service is simply unnecessary. U.S.-Ecuador shippers are being adequately served. Records of the Department of Civil Aviation of Ecuador indicate that during the six months period January 1-June 30, 1997, incumbent scheduled all-cargo operators Arrow, Challenge Air Cargo and Fine Airlines together operated a total of 351 charter or special flights approved by the Government of Ecuador in addition to regular scheduled flights performed pursuant to DOT allocations (approximately two per day). This additional lift is more than double the amount Millon Air was providing and more than compensates for the loss of service resulting from Millon Air's temporary stand down. The applications of all three incumbents for additional scheduled frequencies clearly indicate that they are willing and able to devote additional resources to serving the U.S.-Ecuador market. The disruption associated with insertion of a new entrant at this point simply is not warranted.

Attachment

Counsel: Suzette Matthews, 540-364-3470

U.S.-Ecuador All-Cargo Services / Millon Air, Inc.

Order 97-8-20 | OST-97-2711 | OST-96-1913 | Issued and Served August 21, 1997

Order on Reconsideration and Final Order

By this order, we grant Millon Air's petition of reconsideration of Order 97-7-14, and upon reconsideration, affirm our decisions in Order 97-7-14 to rescind the allocation of frequencies to Millon Air for U.S.-Ecuador services and to dismiss Millon's request for renewal of its frequency allocation. We also make final our decisions to ( 1 ) authorize American International Airways, Inc. (AIA), to perform scheduled foreign air transportation of property and mail between Miami, Florida, and Quito and Guayaquil, Ecuador, and to integrate this authority with the carrier's certificate authority to serve points in Colombia, (2) allocate AIA three U.S.-Ecuador all-cargo frequencies for these services for a one-year period, and (3) subject the frequencies allocated here, as well as frequencies allocated to incumbent carriers, to our standard 90-day dormancy condition.

By: Patrick Murphy