BEFORE THE DEPARTMENT OF TRANSPORTATION WASHINGTON, D.C.
Application of NORWEGIAN AIR INTERNATIONAL LIMITED for an exempti on under 49 U.S.C. § 40109 and a foreign air carrier permit pursuant to 49 U.S.C. § 41301 (U

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. - EU Open Skies) ) ) ) ) ) ) ) ) Docket DOT - OST - 201 3 - 0 204

JOINT ANSWER OF DELTA AIR LINES, INC ., UNITED AIRLINES, INC., AND AMERICAN AIRLINES, INC

. Communications with respect to this document should be addressed to: Howard Kass Vice President

-- Regulatory Affairs American Ai rlines , Inc. 1401 H Street, NW Washington, DC 20005 202

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- 5153 Howard.Kass@ aa .com Robert A. Wirick Managing Director

-- Regulatory and International Affairs American Airlines , Inc. P.O. Box 619616, MD 5635 DFW Airport, Texas 75161 (817) 963

- 0394 robert .wirick@aa.com Hershel I. Kamen Senior Vice President

– Alliances, Regulatory and Policy Daniel A. Weiss Managing Director

– International Affairs and Regulatory UNITED AIRLINES, INC. 233 South Wacker Drive 10th Floor

– HDQIZ Chicago, IL 60606 (872) 825

- 6828 hershel.kamen@united.com dan.weiss@united.com Alexander Van der Bellen Managing Director

– Regulatory and International Affairs & Associate General Counsel Christopher Walker , Regional Director

– Regulatory and International Affairs DELTA AIR LINES, I NC. 1212 New York Avenue, N.W. Washington, D.C. 20005 (202) 842

- 4184 sascha.vanderbellen@delta.com

January 13, 2014BEFORE THE DEPARTMENT OF TRANSPORTATION WASHINGTON, D.C.

Application of NORWEGIAN AIR INTERNATIONAL LIMITED for an exempti on under 49 U.S.C. § 40109 and a foreign air carrier permit pursuant to 49 U.S.C. § 41301 (U

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. - EU Open Skies) ) ) ) ) ) ) ) ) Docket DOT - OST - 2013 - 0 204

JOINT ANSWER OF DELTA AIR LINES, INC ., UNITED AIRLINES, INC., AND AMERICAN AIRLINES, INC

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Delta, U nited, and American (the “ Joint Carriers”) submit this Answer in response to the Depar t ment’s Notice dated January 30, 2014, inviting interested parties to comment on the summary of information provided by the European Del e gation at the January 8, 2014 Joi nt Committee meeting. NAI’s certificate application raises serious pu blic interest, fair competition a nd policy concerns under U

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. - EU A greement and the Depar t ment’s foreign air carrier licensing procedures. 1
The i nformation contained in the N otice rais es more questions than it answers: On the one hand, the Netskar Declaration, NAS’s public statements, and other documentary evidence provided by ALPA in its Answer lead to the conclusion that NAI is being established in Ireland for the primary purpose o f evading Norway’s labor laws. This is contrary to Article 17 bis of the U.S.

- EU Agreement which recognizes the importance of “high labor standards” and that “the opportunities created by the Agreement are not intended to undermine labor standards or the labor

- related rights and principles contained in

1 The terms NAI ( Norwegian Air International), NAS (Norwegian Air System) and NLH ( Norwegian Long Haul ) have the same meanings as the defined terms in the Joint Carrier’s December 20 , 2013 Reply.Norwegian Joint Answer Page 2 the Parties’ respective laws.” If NAS and NAI are allowed to exploit the U

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. - EU agreement to evade oth erwise applicable labor laws, NAI will have achieved a n unfair competitive advantage over U.S. carrie rs in the transatlantic marketplace , which is contrary to the public interest and the DOT’s statutory mandate to “strengthen [] t he competitive position of [U.S.] air carriers to at least ensure equality with foreign air carriers.” 49 U.S.C. §§ 40101(a)(15 ) and (e)(1). On the other hand, according to the Notice summary, the decision to establish NAI in Ireland, and dissolve NLH in Norway, had nothing to do with labor issues, but instead was motivated by unrelated business issues, including, inter alia , “ access to significant additional traffic rights not available to it as a Norwegian carrier, access to additional financing options under OECD rules, and access to insurance and financing rebates because Ireland is a Cape Town Convention signatory.” (Notic e A ttachment at p.1). Before acting on NAI’s application, to ensure consistency with its public interest mandate and the rights and expectations of U.S. aviation interests under the U

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. - EU agreement, we urge the Department to critically examine and co nclusively establish the true facts regarding the proposed formation and certification of NAI. The information contained in the Notice is not sufficient to establish the facts necessary to decide upon this application

. NAI has avoided providing any evide nce or verified statements on the docket regarding its
t rue motives . R ather than providing the Department with concrete and verifiable information, NAI is attempting to res olve concerns regarding its certification through public relations efforts and unve rified white papers. While the Joint Carriers appreciate the efforts of the EU Delegation to gather information from NAI and NAS, this i s not first person evidence, is not supported by any documentary evidence, and has not been subject to critical scrutin y

. The N otice simply contains NIA and NAC’s untested version of events as relayed to the Joint Committee.Norwegian Joint Answer Page 3 Effective June 21, 2011, the United States, Norway, and the European Union agreed that Norway w ould accede to the terms of the U

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. - EU A greement so that Norway’s carriers would have all the benefits and obligations applicable to any other EU carrier. The establishment of NAI in Ireland would give it no additional traffic rights to serve the United States than NLH already enjoys in Norway . Indeed, N LH was formed in Norway less than

one year ago and it currently operates B787 aircraft on routes between the EU a nd points in the United States and Southeast Asia. Whatever unidentified additional traffic rights NAI might purport to gain in Ireland , they are not necessary to meet any of its current or announced service plans . Norway, like Ireland, has ratified the Cape T own Convention, and so it is unclear what additional advantages NAI could hope to obtain as an Irish certificate holder. The claim of ad ditional OECD financing benefits to NAI as a carrier of Ireland are dubious as well, since OECD financing benefits are also available to carriers of Norway. Balanced against NAI’s current story regarding its “business” motives to establish in Ireland i s a well documented history of labor problems in Norway, an appare nt inability to obtain required work permits for contract laborers, and the stringent oversight Norwegian authorities have kept on NLH to operate its Irish

- registered aircraft under a Norweg ian Air Operator Certificate. E vading Norway’s labor laws is a compelling counterfactual to NAI’s
current story

. Ireland allows cabin crew to work on Irish

- registered aircraft without the requirement of a work permit, which would otherwise be a prer e qui site for a Norwegian licensed carrier. Ireland also allows carriers to employ pilots and other crew through recruitment companies and other personal service corporations, rather than requiring pilots to be directly employed by the airline

. As a result, N AI can avoid social insurance taxes required by the country of Norway. Based on the current evidence, it is difficult to see how
NAI ’s motivation is anything more than a clever attempt to circumvent Norway’s labor laws in contravention of Article 17 bis

.Norwegian Joint Answer Page 4 NAI claims to be “a fo reign air carrier of Ireland” (A pp at 1), but NAI proposes no 787 operations from Ireland, and it is not clear what, if any , contacts NAI would have with Ireland, apart fro m its place of certification. We note that in the March 2, 20 07 Memorandum of Consultations, “the EU delegation affirmed that, under European Community legislation, a Community airline must receive both its AOC and its operating license from the count ry in which it has its principal place of business.” Given the fa cts of record it is not clear on what basis Irel and qualifies as NAI’s principal place of business. In summary, the information contained in the Notice does not resolve any of the important outstanding question s about NAI, its fitness, and how granting it a permit would be consistent with Art. 17 bis of the U

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- . EU A greement and the DOT’s public interest mandate.

Respectfully submitted,

/s/ Alexander Van der Bellen Managing Director, Regulatory and International Affairs & Associate General Counsel Delta Air Lines, Inc.

/s/ Robert A. Wirick Managing Director, Regulatory and International Affairs American Airlines , Inc. /s/ Dan Weiss Managing Director

– International Affairs and Regulatory United Airlines, Inc.C ERTIFICATE OF SERVICE A copy of the foregoing Reply has been ser ved this 13th day of January , 2014 , upon the following persons via email:
romanow@pillsburylaw.com peter.nelson@pillsburylaw.com Russell.Bailey@alpa.org steve.morriss ey@united.com dan.weiss@united.com sascha.vanderbellen@delta.com howard.kass@usairways.com robert.wirick@aa.com francis.heil@aa.com rpommer@atlasair.com mlbenge@zsrlaw.com jesse.elliot@faa.gov douglas.schwab@faa.gov nicholas.tsokris@faa.gov john.allen@faa. gov anita.mosner@hklaw.com jennifer.nowak@hklaw.com nssparks@fedex.com dberg@airlines.org jcasey@airlines.org paul.gretch@dot.gov brian.hedberg@dot.gov esta.rosenberg@dot.gov brett.kruger@dot.gov urskr@state.gov CristinaSA@state.gov eugene_alford@ita.doc.g ov info@airlineinfo.com