OST-96-1131 / United Air Lines / Amendment No. 2, US-Japan / February 25, 1998

NOTICE: United requests that this application, as further amended herein, be processed under expedited show-cause procedures pursuant to Subpart Q of 14 CFR Part 302. Any person who wishes to support or oppose this application, as amended, must file an answer by March 25, 1998, and must serve that answer on United and all persons served with this amendment.

Application of

for a Certificate of Public Convenience and Necessity, pursuant to 49 U.S.C. §41101)

(U.S.-Japan)

1. In Amendment No. 1 to United's application in this proceeding, United requested authority to operate foreign air transportation of persons, property and mail over the following route: "Between any point or points behind the U.S., any point or point in the U.S., any intermediate point or points, any point or points in Japan, and any point or points beyond Japan." United also requested authority to integrate service on this new

1/ United requests leave to file this Amendment No. 2 to the extent leave is required. United has already requested leave to submit Amendment No. 1, to which answers are not due until March 6, 1998. Although Northwest filed its answer to Amendment No. 1 on February 20, 1998, before the statutory due date, that carrier will be free to file another answer to this amendment should it want to do so. In these circumstances, no party is prejudiced by United's filing this Amendment No. 2 prior to the due date for answers on the previous amendment.

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route with service authorized on any other route or routes authorized in effective certificates of public convenience and necessity or exemption authorizations consistent with applicable international agreements. It was United's intention to limit its request to serve points in third countries intermediate to and beyond Japan to those which it was already authorized to serve.

2. On the same day on which United filed its Amendment No. 1, Northwest Airlines, Inc., ("Northwest") requested similar U.S.-Japan authority. In addition to a new U.S.-Japan route, Northwest also requested authority to serve additional points intermediate to and beyond Japan in IATA Region TC3 described in an Attachment A to Northwest's application.

3. To the extent that the Department is prepared to entertain applications for authority to serve new third-country points intermediate to or beyond Japan in response to the conclusion of the new U.S./Japan Memorandum of Consultations ("MOC") dated January 30, 1998, then United also takes this opportunity to seek authority to serve all points in IATA Region TC3. These points are named in United's Exhibit WA-8. United amends its request for authority to operate foreign air transportation of persons, property and mail as follows:

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The new U.S./Japan MOC contains terms that confirm United's right to carry fifth-freedom traffic in combination services between IATA Regions TC1 (the Americas) and TC3 (Asia) consistent with bilaterally-agreed formulae. Different formulae apply to fifth-freedom traffic on services between Japan and points in IATA Region TC2 (Europe/Africa). There are no formulae applicable to all-cargo services. By amending its application to include all points in IATA Region TC3, United will obtain the maximum flexibility to use these agreed fifth-freedom rights under the U.S./Japan MOC.

4. United also continues to seek route integration authority, as well as the authority to serve all points in Asia via Japan. This route integration is needed in order to operate services between Japan and third-country points outside Asia. With respect to service between Japan and points in IATA Regions TC1 (the Americas) and TC2 (Europe/Africa), United's route integration authority would allow it to operate combination and all-cargo service over its new U.S.-Japan route in conjunction with service authorized in all of its outstanding certificates of public convenience and necessity and exemption authorizations consistent with applicable international agreements. /2

2/ The route integration condition in United's existing Certificate of Public Convenience and Necessity for Route 130

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Under this route integration authority United could, for example, serve points in Canada or Mexico intermediate to Japan to the extent that United held authority to serve such points in outstanding certificates or exemptions issued by the Department and so long as such service was consistent with the U.S./Canada or U.S./Mexico agreements Similarly, United will be able to integrate all-cargo service to points in Japan with allcargo services to points it is otherwise authorized to serve in the Europe/Africa area and can integrate combination services between these regions to the extent consistent with the terms of the new U.S./Japan agreement as well as other applicable agreements.

WHEREFORE, on the basis of the foregoing, as well as the information in United's previous applications and amendments in this Docket, United respectfully requests the Department to grant its application, as amended on February 6, 1998, and as further amended herein. United also requests the Department to grant it

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such other and different relief as the Department deems to be consistent with the public convenience and necessity.

Respectfully submitted,

JOEL STEPHEN BURTON

GINSBURG, FELDMAN and BRESS, CHARTERED

1250 Connecticut Avenue, N.W.

Suite 800

Washington, D.C. 20036

(202) 637-9130

Counsel for UNITED AIR LINES, INC.