US-Brazil Combination and All-Cargo

Served July 7, 2008

Notice Inviting Applications

By this Notice, we invite U.S. air carriers to file applications for the immediately available combination and all-cargo air transportation opportunities set out in Attachment B of the Memorandum of Consultations between the United States and Brazil dated June 26, 2008.

The United States and Brazil have reached an ad referendum agreement that provides for the expansion of scheduled and charter services, for both combination and all-cargo carriers, under the U.S.-Brazil Air Transport Agreement. The terms of the 2008 Agreement will be applied on the basis of comity and reciprocity pending the exchange of diplomatic notes bringing the amendments into force.

Effective immediately, there is no limitation on the number of U.S. carriers that may be designated to provide scheduled combination or all-cargo services pursuant to the U.S.-Brazil Air Transport Agreement. In addition, U.S. carriers may serve the Brazilian cities of Fortaleza and Curitiba, as well as three additional cities to be selected by the United States.

Under the 2008 Agreement, the number of weekly frequencies available to U.S. carriers for scheduled combination services will increase, in four stages culminating in October, 2010, from the current limit of 105, all of which are currently allocated, to 154 frequencies, subject to restrictions on the Brazilian points that may be served. Effective immediately, U.S. carriers may operate an additional 21 weekly frequencies limited to points in the North, Northeast, and Midwest regions of Brazil and/or Belo Horizonte. Effective June 1, 2009, U.S. carriers may operate an additional 7 weekly frequencies limited to points in the North, Northeast, and Midwest regions of Brazil and/or Belo Horizonte and/or Rio de Janeiro. Effective October 1, 2009, U.S. carriers may operate an additional seven weekly frequencies to points in Brazil and effective October 1, 2010, U.S. carriers may operate an additional 14 weekly frequencies to points in Brazil.

Under the 2008 Agreement, the United States may allocate immediately a total of 35 weekly frequencies for scheduled all-cargo services. Currently, the United States has already allocated 24 such frequencies, and therefore it may now allocate an additional 11 frequencies for scheduled all-cargo services. Effective October 1, 2010, U.S. carriers may operate an additional seven weekly frequencies for scheduled all-cargo services.

The 2008 Agreement provides for additional all-cargo charter services. Effective immediately, the United States may distribute 1,000 all-cargo charter flights annually, in place of the previously-available annual limit of 750 charter flights. Beginning July 1, 2010, the United States may distribute 1,250 all-cargo charter flights annually.

In light of the increase in all-cargo charter opportunities we are considering whether to revise the procedures announced in the May 30, 2008, Brazil Charter Notice. We will announce any proposed changes through show-cause procedures, allowing interested parties an opportunity to comment.

By: Paul Gretch