OST-97-2852 / OST-97-2855 / OST-97-2548 / Fine Air / Southern Air / Joint Application of FedEx, Arrow, FWIA / Consolidated Answer of FedEx, Arrow, FWIA / August 26, 1997

Applications of

FINE AIR SERVICES, INC.

SOUTHERN AIR TRANSPORT, INC.

for U.S.-Argentina Cargo Frequencies

Joint Application of

FEDERAL EXPRESS CORPORATION, ARROW AIR, INC. and FLORIDA WEST INTERNATIONAL AIRWAYS, INC.

for approval of a transfer of frequency allocations pursuant to 49 U.S.C. §41105 (U.S.-Argentina All-Cargo Frequencies)

August 26, 1997

JOINT CONSOLIDATED ANSWER OF

FEDERAL EXPRESS CORPORATION,

ARROW AIR, INC. AND FLORIDA WEST

INTERNATIONAL AIRWAYS, INC.

Pursuant to the Notice issued on August 14, 1997 by the Director of the Department's Office of International Aviation (the "Argentina Notice"), Federal Express Corporation ("Federal Express"), Arrow Air, Inc. ("Arrow") and Florida West International Airways, Inc. ("FWIA"), also referred to collectively hereafter as the "Joint Applicants", hereby submit their Joint Consolidated Answer in opposition to certain applications filed in response to the Argentina Notice, to

 

FedEx-Arrow-FWIA Transfer

Argentina Cargo Frequencies

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the extent that those applications seek allocation of any of the three (3) U.S.-Argentina cargo frequencies at issue in the frequency transfer proceeding pending in Docket OST-97-2548. /1

On August 25, 1997, applications for Argentina cargo frequencies were filed by Fine Air Services, Inc. ("Fine Air") and Southern Air Transport, Inc. ("Southern Air"). Both Fine Air and Southern Air applied for four Argentina cargo frequencies each.

The Joint Applicants take no position with regard to the foregoing applications insofar as they seek only the reallocation of two arguably-dormant Argentina frequencies currently allocated to Challenge Air Cargo, Inc. ("Challenge"). Insofar as the applications by Fine Air and Southern Air seek the allocation of more than two Argentina cargo frequencies, however, they must be construed as seeking the reallocation to those applicants of the two Argentina cargo frequencies currently allocated to Arrow, which frequencies have been sold by Arrow to Federal Express, subject to Department approval as applied for in Docket OST-97-2548.

The Joint Applicants strongly object to the consideration or grant of the foregoing applications by Fine Air and Southern Air, to the extent that they

1/ Arrow filed a "Contingent Application" for two Argentina cargo frequencies, in order to protect its ability to apply for those frequencies in the event that its prior frequency allocation is found to be dormant and not available for transfer. The Joint Applicants, including Arrow, strongly dispute the legal and factual validity of such a finding. This Answer is not directed to Arrow's "Contingent Application".

 

FedEx-Arrow-FWIA Transfer

Argentina Cargo Frequencies

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seek allocation of any of the Argentina cargo frequencies at issue in Docket OST-97-2548, on the following three grounds:

1. Under longstanding Department policy and precedent, the three Argentina cargo frequencies at issue in the Section 41105 transfer application in Docket OST-97-2548 are not available for competing applications.

2. Contrary to the "suggestion" contained in the Argentina Notice, the two Argentina cargo frequencies held by Arrow are not dormant, and have not reverted back to the Department for reallocation.

3. To the extent that the Argentina Notice invited competing applications for any of the three Argentina cargo frequencies at issue in Docket OST-97-2548, it is an unauthorized and invalid exercise of authority by the Director of the Office of International Aviation in that it exceeds the scope of delegated authority conferred on the Director by Section 385.13 of the Department's Organizational Regulations.

A more detailed discussion of the rationale and justification for each of the foregoing objections is contained in the Joint Petition For Review Of Staff Action filed by the Joint Applicants on August 21, 1997 in Docket OST-97-2548. In accordance with the Department's Rules of Practice, the Joint Applicants hereby adopt and incorporate by reference the entirety of that Petition for Review in support of this Answer in partial opposition to the applications at issue. For the convenience of the Department and the parties, a copy of that Petition for Review is attached to this Answer.

 

FedEx-Arrow-FWIA Transfer

Argentina Cargo Frequencies

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WHEREFORE, for the reasons discussed in this Answer and the attached and referenced Petition for Review, Federal Express, Arrow and FWIA urge the Department to issue an Order dismissing the applications of Fine Air and Southern Air, insofar as those applications request the allocation of any of the Argentina cargo frequencies at issue in Docket OST-97-2548. The Joint Applicants further respectfully urge the Department to issue an immediate Final Order approving the transfer of three Argentina cargo frequencies to Federal Express in Docket OST-97-2548.

Respectfully submitted,

Allan Markham for Arrow Air

Marshall Sinick of Squire Sanders for FWIA

FedEX and Nathaniel Breed of Shaw Pittman