OST-97-2265 / Polar Air Cargo / US-Philippines Start-Up Delay / February 18, 1998

NOTICE: Polar Air is requesting expedited consideration of its Application. It is requested that any party filing an answer in support of or in opposition to this Application file their comments with the Department on or before February 25, 1998. Polar will poll interested parties and advise the Department of the results.

Application of

for grant of an exemption pursuant to 49 U.S.C. § 40109

(Extension of start-up period for U.S.-Philippines all-cargo service)

Polar Air, unfortunately, again finds it necessary, for reasons beyond its control, to request a further 60-day extension of the period in which it is required to commence scheduled all-cargo services at Manila. Polar Air's application for appropriate authorizations in the Philippines has been pending before the Philippine Air Transport Office ("PATO") for some time. Although Polar Air had received repeated informal assurances from Philippines government officials that they

Application of Polar Air Cargo

Page 2

considered the application to be complete, non-controversial, and that Polar Air could anticipate routine approval, Polar Air has yet to receive such approval.

As the Department is aware, the U.S. Embassy in Manila is working to resolve this matter. However, it does not appear that any action will be taken in time to allow Polar Air to begin service by March 6, 1998.

Earlier this week, Polar Air was advised by its attorneys that due to staffing turnover in PATO the review of Polar Air's application, as filed and supplemented, would now effectively have to begin de nova by new personnel. Both Polar Air and the U.S. Embassy in Manila have been unable to extract any assurance from PATO concerning a date certain by which the authorization might be granted.

Given the unusual political and commercial factors that continue to affect its application and start-up, Polar Air therefore requests that its exemption be extended for an additional 60 days. Polar Air is now targeting March 29, 1998, for the start of service to coincide with the start of the Summer Operating Season. This should also provide more than adequate time for the new personnel at PATO to review and approve Polar Air's application. However, given past experience and the lack of any encouraging estimates from the Philippines as to the completion of its review process, Polar Air is requesting a 60-day extension in order to avoid the need to submit repetitious exemption applications as the final decision date by PATO slips further into the future.

Application of Polar Air Cargo

Page 3

The grant of the requested extension would be consistent with established Department precedent in situations in which the start-up delay is related solely to the timing of the receipt of foreign government authorizations, a matter beyond Polar Air's control. (See, Order 97-2-14, served Feb. 21, 1997) Given the public benefits that would flow from Polar Air's scheduled B-747F all-cargo service, which was catalogued by the Department in Order 97-1-17, an extension of time in which to begin service would be in the public interest.

WHEREFORE, Polar Air Cargo, Inc. respectfully requests that its exemption from the start-up provisions of Order 97-1-17 be renewed so as to extend the deadline for starting service until May 5, 1998. Polar Air also requests that the Department grant it such other and different relief as the Department deems to be consistent with the public interest and with this application.

Respectfully submitted,

JEFFREY A. MANLEY

GINSBURG, FELDMAN & BRESS, CHARTERED

1250 Connecticut Avenue, N.W.

Suite 800

Washington, D.C. 20036

(202) 637-9057

Attorney for POLAR AIR CARGO, INC.

DATED: February 18, 1998