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OST-99-5582

United Air Lines, Inc. and Compania Mexicana de Aviacion, S.A. de C.V.

Due to the ongoing discussions between the U.S. and Mexico on code-share issues, these statements of authorization were issued for a term of 179 days. They are currently set to expire on June 1, 1999. The discussions culminated in a new Memorandum of Consultations, dated January 26, 195'9, addressing the outstanding bilateral code-share issues. On the basis of the new agreement, United and Mexicana respectfully request that their statements of authorization be promptly renewed for an indefinite term, consistent with recent Department practice.

Counsels:  Squire Sanders, Robert Papkin for Mexicana, 202.626.6601 and Kirkland & Ellis, Jeffrey Manley for United, 202.879.5161

United Air Lines, Inc. and Compania Mexicana de Aviacion, S.A. de C.V.

By:  Teresa Bingham

United Air Lines, Inc. and Compania Mexicana de Aviacion, S.A. de C.V.

In conclusion, United and Mexicana strongly urge the Department to reconsider its action in conditioning the exclusivity term of the United/Mexicana code-share arrangement. On reconsideration, United urges the Department to reverse that action in light of the vigorous competition that characterizes the U.S. -Mexico transborder market and the broad opportunities for expansion of U.S. -Mexico competition. Given the foregoing, there is no need to condition the exclusivity provision of United/Mexicana code share and certainly no need to condition it more strictly than is the case with respect to the condition applicable to the code share between Northwest and Air China.

Counsel:  Squire Sanders, Robert Papkin, 202-626-6601 for Mexicana / United and Kirkland Ellis, Jeffrey Manley, 202-879-5161

United Air Lines, Inc. and Compania Mexicana de Aviacion, S.A. de C.V.

For the reasons contained in Delta’s own Petition for Reconsideration filed on June 22, 1999, there is no basis in law, policy or fact to support the Department’s imposition of a prohibition against exclusivity clauses in U.S.-Mexico codeshare arrangements. As Delta and United/Mexicana demonstrated, U.S.-Mexico is an extraordinarily open and competitive air transportation marketplace. Moreover, codesharing under contracts which provide for exclusivity have been in the U.S.-Mexico marketplace for several years without any adverse competitive impacts.

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

United Air Lines Inc and All Nippon Airways Co., Ltd. and Air France and Delta Air Lines, Inc. and Continental Airlines, Inc. and Continental Express, Inc. and Aerovias de Mexico, S.A. de C.V. and Compania Mexicana de Aviacion, S.A. de C.V.

We reject arguments that we should adopt a laissez-faire approach to exclusive dealings between and among airlines in international air transportation. It is not in the public interest to ignore any feature of a code-share agreement that could interfere with competition or otherwise undermine the ability of consumers to benefit from the opportunities created by our aviation relationships. For that reason, we will continue to assess the merits of code-share exclusivity provisions on a case-by-case basis in light of the terms of the overall arrangement and of the special facts and circumstances affecting each market, such as its structure, the positions of the parties in those markets, and the nature of the bilateral aviation relationship governing it.

By:  Brad Mims

OST-96-1988 - US-Mexico
OST-97-3237 - US-Mexico
OST-99-5582 - US-Mexico Codesharing
OST-99-6481 - US-Mexico
OST-00-8221 - United Codeshare with Mexicana
OST-00-8260 - Blind Sector Codeshare for Mexicana - San Francisco-Sydney
OST-00-8297 - US-Japan Blind Sector Codeshare for Mexicana
OST-01-9177 - Mexico-Guatamela/Panama City Codeshare
OST-01-9715 - Blind Sector Codeshare for Mexicana - Chicago-London
OST-01-9955 - Blind Sector Codeshare for Mexicana - US-Korea
OST-02-11289 - Codeshare Operations; Mexico City and San Salvador-Miami and Santo Domingo
OST-02-12502 - US-Mexico Codesharing
OST-02-12966 - Blind Sector Codeshare for Mexicana - Chicago-Frankfurt
OST-02-13092 - Conversion of Denver-Mexico City Designation
OST-02-13204 - Blind Sector Codeshare for Mexicana - Beyond US to Buenos Aires and Paris
OST-02-13228 - Mexico City-San Jose Codeshare
OST-02-13663 - Los Angeles-Zacatecas/Morelia Codeshare

November 14, 2003

Re: Joint Notification of Termination of Codeshare and Regulatory Cooperation Agreement

In accordance with the terms of the Department of Transportation's approvals of the statements of authorization in the above‑captioned dockets, Compania Mexicana de Aviacion, S.A. de C.V. and United Air Lines, Inc. hereby notify the Department of the expiration of their Codeshare and Regulatory Cooperation Agreement effective November 15, 2003. As a result of the Agreement's expiration, all codeshare services operated by Mexicana and United will be discontinued effective March 31, 2004, and the related statements of authorization cease to be effective after that date. This notice applies only to the statements of authorization issued in the above referenced dockets and not to any exemptions granted to United or Mexicana in those dockets or any other docket.

Counsel: Wilmer Cutler, Jeffrey Manley, 202-663-6670 for United / Squire Sanders, Charles Donley, 202-626-6840 for Mexicana

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