OST-99-6587 / Continental Airlines / US-South Africa Third-Country Codesharing / Answer of American Airlines / December 16, 1999

 

Application of

CONTINENTAL AIRLINES, INC. / OST-99-6587

for an exemption pursuant to 49 USC 40109 (U.S.-South Africa third-country codesharing with Alitalia) 

 

ANSWER OF AMERICAN AIRLINES, INC.

 

American Airlines, Inc. hereby answers the application submitted on December 1, 1999 by Continental Airlines, Inc., seeking authority to engage in third-country codesharing between the U.S. and South Africa with Alitalia via Milan, Italy. American does not object to Continental's request, provided that American's application of December 3, 1999 in OST-99-6595, to engage in U.S.-South Africa codesharing with British Airways via London, is also granted.

Annex I to the 1996 U.S.-South Africa Air Transport Agreement provides that the U.S. may designate, as of November 1, 1999, a total of four U.S. carriers to serve South Africa under codeshare arrangements with carriers of third countries. Three of these four designations have been assigned. See Order 99-1-5, January 4, 1999(Delta/Air France via Paris); Order 97-

 

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10-14, October 12, 1997 (United/Lufthansa via Frankfurt and Northwest/KLM via Amsterdam).

However, Delta should be required to surrender its third-country designation with Air France as a condition for approval of the pending Delta/South African Airways codesharing applications in OST-99-6556, OST-99-6558, OST-99-6559, and OST-99-6555. See the answers of American and Continental in those dockets submitted on December 6, 1999. It would be contrary to the public interest for Delta to codeshare with South African Airways and to hold one of the four third-country codeshare designations as well.

Accordingly, once Delta surrenders its U.S.-South Africa designation with Air France, there will be two available designations for the Department to assign. One should go to American for services with British Airways, and the other should go to Continental for services with Alitalia.

If the Department allows Delta to codeshare with South African Airways and Air France -- an outcome which we strongly oppose -- there would be only one available designation, requiring a carrier-selection proceeding between American/British Airways and Continental/Alitalia. If such a proceeding is necessary, American will show why its proposed service should be selected.

 

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Clearly, the public interest would be far better served by requiring Delta to surrender its designation with Air France, so that the Department may grant both American's application in OST-99-6595, and Continental's application here, thereby creating maximum competitive benefits for the traveling and shipping public.

 

Respectfully submitted,

CARL B. NELSON, JR.

Associate General Counsel

American Airlines, Inc.

December 16, 1999