UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, DC

Issued by the Department of Transportation on April 23, 2010

 NOTICE OF ACTION TAKEN -- DOCKETS DOT-OST-2009-0344, DOT-OST-2003-16102,

and DOT-OST-2003-15479 _____________________________________________________________________________________________________________________

This serves as notice to the public of the action described below, taken by the Department official 

indicated (no additional confirming order will be issued in this matter).

1. Docket DOT-OST-2009-0344

Application of CONTINENTAL AIRLINES, INC. (CONTINENTAL) filed 3/12/10 for:

XX Amendment of exemption under 49 U.S.C. 40109 to provide the following services: 

Scheduled foreign air transportation of persons, property and mail between a point or points in the 

United States and a point or points in Japan and a point or points beyond Japan, either nonstop or via 

an intermediate point or points in third countries, by code-sharing on flights operated by Air Japan Co., 

Ltd. (Air Japan) and IBEX Airlines Co., Ltd. (IBEX).

1 2

2. Docket DOT-OST-2003-16102

Application of AIR JAPAN filed 3/12/10 for:

XX Blanket statement of authorization in order to engage in the following code-share services:

Air Japan requests a blanket statement of authorization to display Continental’s “CO” designator code

on flights operated by Air Japan between: (i) a point or points in Japan and a point or points in the 

United States, either nonstop or via an intermediate point or points in third countries; (ii) any points in 

Japan, limited to Continental traffic originating or terminating outside Japan; (iii) a point or points in 

the United States and a point or points beyond the United States; and (iv) a point or points in Japan and 

a point or points beyond Japan on a blind sector basis.3

3. Docket DOT-OST-2003-15479

Application of IBEX filed 3/12/10 for:

XX Amendment of exemption under 49 U.S.C. 40109 to provide the following services:

Scheduled foreign air transportation of persons, property and mail between any point or points in Japan 

and any point or points in the United States in connection with a code-share arrangement with 

Continental.4

 1 Continental seeks amended exemption authority to include points in third countries for which Continental does not 

otherwise hold authority by exemption or certificate. 2 Air Japan and IBEX will not be placing their codes on flights operated by Continental, but Continental will be 

placing its code on flights operated by Air Japan and IBEX.

3 Air Japan currently holds a statement of authorization for mail-only code-share services with Continental. Air 

Japan seeks to broaden its authority to cover foreign air transportation of persons, property, and mail on a blanket 

basis.

4 IBEX requests that its exemption authority be granted for a period of two years.
XX Amendment of statement of authorization in order to engage in the following code-share services:

IBEX requests an amended statement of authorization under 14 CFR Part 212 to display the designator 

code of Continental on flights operated by IBEX between points in Japan, limited to the carriage of 

Continental’s (or Continental Micronesia’s) U.S.-Japan traffic.

5

 

Applicant reps: Lorraine B. Halloway, (202) 624-2538 (Continental) and 

DOT Analyst: 

Charles J. Simpson (202) 973-7926 (Air Japan and IBEX)

Brett D. Kruger (202) 366-8025

DISPOSITION

XX Approved amendment of Continental’s exemption authority (subject to conditions, see below).

XX Approved blanket statement of authorization to Air Japan (subject to conditions, see below).

XX Approved in part, amendment of IBEX’s exemption authority; remainder (request for longerterm authority) dismissed. 6 (subject to conditions, see below).

XX Approved amendment of IBEX’s statement of authorization (subject to conditions, see below).

7

The above action granting amended exemption authority to Continental is effective when taken: April 23, 

2010, through January 19, 2012.

8

 The above action granting amended exemption authority to IBEX is

effective when taken: April 23, 2010, through April 23, 2011. The above actions granting statements of 

authorization to the referenced carriers are effective: April 23, 2010, and will remain in effect 

indefinitely, subject to conditions.

Action taken by: Paul L. Gretch, Director

 Office of International Aviation

XX The authority granted is consistent with the 1998 U.S.-Japan Memorandum of Understanding, 

as amended.

Except to the extent exempted or waived, this authority is subject to the terms, conditions, and limitations 

indicated: 

 XX

 

Continental’s certificates of public convenience and necessity

XX

 

Standard U.S. exemption conditions (attached as Appendix A)

XX

 

Standard foreign carrier exemption conditions (attached as Appendix B) 

XX

__________________________________________________________________________________

Conditions for Statements of Authorization (attached as Appendix C) 

 5 IBEX currently holds a statement of authorization permitting it to display the designator code of United Air Lines, 

Inc. (United) on flights operated by IBEX between points in Japan (limited to the carriage of United’s U.S.-Japan 

traffic), using small aircraft. IBEX requests amendment of its statement of authorization to include code-share 

operations with Continental. In addition, IBEX requests removal of the small aircraft limitation since it intends to 

display the designator codes of United and Continental on flights using its 70-seat CRJ700 aircraft. 6 The one-year duration of the authority we granted to IBEX is consistent with our usual policy of granting 

exemption authority in the circumstances presented. We therefore, dismissed the application to the extent that it 

sought authority for a longer period.

7 Our approval includes removal of the small aircraft limitation.

8 Continental requests that its amended exemption authority be granted through January 19, 2012, coextensive with 

its existing exemption authority in Docket DOT-OST-2009-0344.
Remarks: We note that Continental has conducted safety audits of Air Japan and IBEX under the 

Department’s Code-Share Safety Audit Program, and the FAA has advised us that it has reviewed the 

relevant audit reports and found them to be acceptable.

__________________________________________________________________________________

On the basis of data officially noticeable under Rule 24(g) of the Department's regulations, we found 

Continental qualified to provide the exemption services authorized. Under authority assigned by the 

Department in its regulations, 14 CFR Part 385, we found that (1) our action in this notice was consistent 

with Department policy; (2) grant of the exemption authority to Continental was consistent with the 

public interest; and (3) grant of that authority would not constitute a major federal action under the 

Energy Policy and Conservation Act of 1975. 

To the extent not granted or dismissed, we denied all requests in the referenced Docket. We may amend, 

modify, or revoke the authority granted in this Notice at any time without hearing at our discretion.

Persons entitled to petition the Department for review of the action set forth in this Notice under the 

Department’s regulations, 14 CFR §385.30, may file their petitions within seven (7) days after the date of 

issuance of this Notice. This action was effective when taken, and the filing of a petition for review will 

not alter such effectiveness.

An electronic version of this document is available on the World Wide Web at:

http://www.regulations.gov
Appendix A

U.S. Carrier Exemption Conditions

In the conduct of the operations authorized, the U.S. carrier applicant(s) shall:

(1) Hold at all times effective operating authority from the government of each country served;

(2) Comply with applicable requirements concerning oversales contained in 14 CFR 250 (for 

scheduled operations, if authorized);

(3) Comply with the requirements for reporting data contained in 14 CFR 241;

(4) Comply with requirements for minimum insurance coverage, and for certifying that coverage 

to the Department, contained in 14 CFR 205;

(5) Except as specifically exempted or otherwise provided for in a Department Order, comply 

with the requirements of 14 CFR 203, concerning waiver of Warsaw Convention liability limits 

and defenses;

(6) Comply with all applicable requirements of the Federal Aviation Administration, the 

Transportation Security Administration, and with all applicable U.S. Government requirements 

concerning security, including, but not limited to, 49 CFR Part 1544. To assure compliance with 

all applicable U.S. Government requirements concerning security, the holder shall, before 

commencing any new service (including charter flights) to or from a foreign airport, contact its 

Principal Security Inspector (PSI) to advise the PSI of its plans and to find out whether the 

Transportation Security Administration has determined that security is adequate to allow such 

airport(s) to be served;

(7) Comply with such other reasonable terms, conditions, and limitations required by the public 

interest as may be prescribed by the Department of Transportation, with all applicable orders and 

regulations of other U.S. agencies and courts, and with all applicable laws of the United States.

The authority granted shall be effective only during the period when the holder is in compliance 

with the conditions imposed above.

1/2008
Appendix B

Foreign Carrier Exemption Conditions

In the conduct of the operations authorized, the foreign carrier applicant(s) shall:

(1) Not conduct any operations unless it holds a currently effective authorization from its homeland for 

such operations, and it has filed a copy of such authorization with the Department;

(2) Comply with all applicable requirements of the Federal Aviation Administration, the Transportation 

Security Administration, and with all applicable U.S. Government requirements concerning security, 

including, but not limited to, 14 CFR Parts 129, 91, and 36 and 49 CFR Part 1546 or 1550, as applicable. 

To assure compliance with all applicable U.S. Government requirements concerning security, the holder 

shall, before commencing any new service (including charter flights) from a foreign airport that would be 

the holder’s last point of departure for the United States, contact its International Industry Representative 

(IIR) (formerly referred to as International Principal Security Inspector) to advise the IIR of its plans and 

to find out whether the Transportation Security Administration has determined that security is adequate to 

allow such airport(s) to be served;

(3) Comply with the requirements for minimum insurance coverage contained in 14 CFR Part 205, and, 

prior to the commencement of any operations under this authority, file evidence of such coverage, in the 

form of a completed OST Form 6411, with the Federal Aviation Administration’s Program Management 

Branch (AFS-260), Flight Standards Service (any changes to, or termination of, insurance also shall be 

filed with that office);

(4) Not operate aircraft under this authority unless it complies with operational safety requirements at 

least equivalent to Annex 6 of the Chicago Convention;

(5) Conform to the airworthiness and airman competency requirements of its Government for 

international air services;

(6) Except as specifically exempted or otherwise provided for in a Department Order, comply with the 

requirements of 14 CFR Part 203, concerning waiver of Warsaw Convention liability limits and defenses;

(7) Agree that operations under this authority constitute a waiver of sovereign immunity, for the purposes 

of 28 U.S.C. 1605(a), but only with respect to those actions or proceedings instituted against it in any 

court or other tribunal in the United States that are: (a) based on its operations in international air 

transportation that, according to the contract of carriage, include a point in the United States as a point of 

origin, point of destination, or agreed stopping place, or for which the contract of carriage was purchased 

in the United States; or (b) based on a claim under any international agreement or treaty cognizable in 

any court or other tribunal of the United States. In this condition, the term "international air 

transportation" means "international transportation" as defined by the Warsaw Convention, except that all 

States shall be considered to be High Contracting Parties for the purpose of this definition;

(8) Except as specifically authorized by the Department, originate or terminate all flights to/from the 

United States in its homeland;

(9) Comply with the requirements of 14 CFR Part 217, concerning the reporting of scheduled, 

nonscheduled, and charter data;

(10) If charter operations are authorized, except as otherwise provided in the applicable aviation 

agreement, comply with the Department's rules governing charters (including 14 CFR Parts 212 and 380); 

and

(11) Comply with such other reasonable terms, conditions, and limitations required by the public interest 

as may be prescribed by the Department, with all applicable orders or regulations of other U.S. agencies 

and courts, and with all applicable laws of the United States.

This authority shall not be effective during any period when the holder is not in compliance with the 

conditions imposed above. Moreover, this authority cannot be sold or otherwise transferred without 

explicit Department approval under Title 49 of the U.S. Code.

12/2007
Appendix C

The code-share operations authorized here are subject to the following conditions:

(a) The statement of authorization granted to Air Japan will remain in effect only as long as 

(i) Continental and Air Japan continue to hold the necessary underlying authority to operate the codeshare services at issue, and (ii) the code-share agreement providing for the code-share operations remains 

in effect.

(b) The statement of authorization granted to IBEX will remain in effect only as long as (i) Continental 

and IBEX continue to hold the underlying authority to operate the code-share services at issue, and (ii) the 

code-share agreement providing for the code-share operations remains in effect;

(c) Continental, Air Japan, and/or IBEX, as appropriate, must notify the Department no later than 30 days 

before they begin any new code-share service under the code-share services authorized here. Such notice 

shall identify the market(s) to be served, which carrier will be operating the aircraft in the code-share 

market added, and the date on which the service will begin. Such notice should be filed in Docket DOTOST-2003-16102 and/or DOT-OST-2003-15479.

1

(d) Continental, Air Japan, and/or IBEX, as appropriate, must promptly notify the Department if the codeshare agreement providing for the code-share operations is no longer effective or if the carriers decide to 

cease operating all or a portion of the approved code-share services. Such notice should be filed in 

Docket DOT-OST-2003-16102 and/or DOT-OST-2003-15479.

2

(e) The code-sharing operations conducted under this authority must comply with 14 CFR 257 and with 

any amendments to the Department’s regulations concerning code-share arrangements that may be 

adopted. Notwithstanding any provisions in the contract between the carriers, our approval here is 

expressly conditioned upon the requirements that the subject foreign air transportation be sold in the name 

of the carrier holding out such service in the computer reservation systems and elsewhere; that the carrier 

selling such transportation (i.e., the carrier shown on the ticket) accept responsibility for the entirety of 

the code-share journey for all obligations established in its contract of carriage with the passenger; that 

the passenger liability of the operating carrier be unaffected; and that the operating carrier shall not permit 

the code of its U.S. code-sharing partner to be carried on any flight that enters, departs, or transits the 

airspace of any area for whose airspace the Federal Aviation Administration has issued a flight 

prohibition.

(f) The authority to operate to third countries is subject to the condition that any service provided under 

these statements of authorization shall be consistent with all applicable agreements between the United 

States and the foreign countries involved. Furthermore, (i) nothing in the award of these statements of 

authorization should be construed as conferring upon Continental rights (including code-share, fifth 

freedom intermediate and/or beyond rights) to serve markets where U.S. carrier entry is limited unless 

Continental notifies the Department of its intent to serve such a market and unless and until the 

Department has completed any necessary carrier selection procedures to determine which carrier(s) 

should be authorized to exercise such rights; and (ii) should there be a request by any carrier to use the 

limited-entry route rights that are included in the authority of Continental by virtue of the statements of 

authorization granted here, but that are not then being used by Continental, the holding of such authority 

will not be considered as providing any preference for Continental in a competitive carrier selection 

proceeding to determine which carrier(s) should be entitled to use the authority at issue.3

(g) The authority granted here is specifically conditioned so that neither Continental, Air Japan nor IBEX

shall give any force or effect to any contractual provisions between themselves that are contrary to these 

conditions.

We may amend, modify, or revoke the authority granted at any time without hearing at our discretion.

 1 See Appendix D for list of initial code-share points. 2 We expect this notification to be received within ten (10) days after such non-effectiveness or of such decision. 3 The notice in paragraph (c) above can be used for this notification. 
Appendix D

INITIAL LIST OF CODE-SHARE POINTS