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U.S. Deportment Assistant Secretary 1200 New Jersoy AI/C.Tlut'. SE 

of Transportation Washington, DC 20590 

Office of the Secretary 

atTransportation APR 1 2 20 

The Honorable Arnold Schwarzenegger 


Governor of California 


Sacramento, CA 95814 


DearGovernor Schwarzenegger: 

Thank you for your letters of December22 and February 26. expressing support for trl~ U.S.-Japan 

Open-Skies Agreement and urging tbeU.S; Department ofTransportation toexpedittously review 

. and approve applications for antitrust itntnunity filed by U;S. and Japanese carriers. I am 

respon(iing on behalf of the Secretary, 

Following the announcement (Jfthe open.:skies agreement,. in December 2009, the Department 

received two applications for antitrust·inlInunity. the first from members of the Star Alliance (AB 

Nippon Airways, Continental Airlines,and United Airlines) and the second from members ofthe 

oneworld allif,lOce (American Airlillesand Japan Airlines). Accordingto both applications, the 

alHance partnerspJan to coordinate their international flights and launch competing joint ventures 

thrtheconveyance oftt'aftic between the U.S. and Asia. 

The applications - which the Depmtment will process l:it the same time - are administered ina 

public docket. which ensures that interested parties have the opportunity to .comment. The 

Department will evaluate the appliCations according to rigorous statutory standarqs; beginning 

with a review ·ofthe record to detennine if it is substantially complete. Decisions on the 

!,lpplicatiort are made in consultation with the Departmentof JustIce's Antitrust Division foJlowing 

a thorough analysis of competitive fact9fs. The Department win endeavor to consider the 

applioations as quickly aspossible,$ubject todueproces8 and administrative requirements. As 

these matters are now pending, I hope you understand that I cannot comment on their merits. I can 

assure.you,howevet, that the Department willgive full and fairconsidetation to the applications 

as well as any comments filed ihlhe dockets. 

Asisour normaipractice, Ja.mplacirlg a copy ofyout letter and this response in Docket DOT.. 

OST~201 0-0059 as a contact outside. the record in these matters. I appreciate your interest in these 

issues. 

Sin~t~a 

Susan L. Kurland 

,ssistant Secl'etary for 

Aviation and Intern1}tiOltal Affairs 
" ,.­

2023663615 Uno OSTW85 31 {) 1054: 16 a.m. ~ S 1 0-091223-0 1 8 

• 

GOVERNOR ARNOLD SCHWARZENEGGER 

December 22, 2009 

The Honorable Raymond H. LaHood 

Secretary ofTransportation 

12QO New Jersey Avenue. sa 

Wasnington, DC 20590

• 

Dear Mr. Secretary. 

I want t6commend the. U.S.. and Japan on reaching an Open Sides Agreement. Iffully 

.implemented, this.historic aQCoid woUld help increase competition, enhance cholCe for 

con~ lead ,to mor~ .!let',Vjee fot OllnuDunities in both tbeUnited States _ JaJkUl.,Wliile 

also providing travelers more,airUne sea~, tlestinatioQs. routings, sqh!'dul~ andprioing options, 

To achieve these goals, 1support the airline antitrust immUnity envISioned under the Open Sides 

Agreement, provided that the applicationsultimatelf filed and apptogelidrlsute healthy and 

robust competition between the competing camersand their re~tive /1lliaru:es, The 

applications being p~rsued. ~y American AirUnes ~d JJlP8D Airlines apd by United AttJ,ines, 

Continen~l and All ippon.Alrwa.ys will u1tima~ly benefit CaJlibmia and the United States. 

In.fbb clutll.enging economk envitolUuent. our tdrUnes~d.1O pursue all opportunities t()lIllow 

them I.\l14 the communities they·~r:v.c to competitive in EIQ ~Ilcrea$ingly glQb~llU1ll:ketplace. 

Approval ofthese applications WGuld allow tbcseairlines to gcnc;r.elesignifiWtt pri.ceand . 

service benefits for COnsUMerS, help preserve andcnhance servie» to communities tJuo~sho\lt the 

Uw'te!:l State!! and compete more etI'eetively with other international airlines and allianea. ~" 

I urge you to ensUre that tbislong..awaited and eagerly anticipated agreement is enacted and tbat 

the consumer bel1efi~ are reJJized. 

Sincerely'"' • . 

Arnold Scbwarzenegger 

Ita 

STAre ~APITOt • SACRAMENTO, CAtlfORN(A 95814 • (91tH H5·2841 

",W 
line OSTWIl5 310 03.16·40 pm S10-100301-052 

February26,2010 GOVERNOR ARNOLD SCHWARZENEGGER 

The Honorable Raymond H. LlfrIood , Secretary ofTnmsportation 

1200 New JerSey Avenue, sa W~hl.n.gton> 00 20$90 

Dear Mr. Secretary, 

As you $'e aw~e. froln our preVious corteSpondenee, Califomlan$are watching clo$ely for th" fuJi 

Unplementatic:m ofthe Open Skies Asreem~nt between JiWan amt 1;be United States. P$ticularly 

importtmt to me as CalifQmi~ts governor is i~ p(jtential impact on touri~l\l. 

Tourism generated $.9.1.6billion 'in spendingm Califormtlln 2aOs.,an increase from 2007. Nearly 

20 per-cent ofaU toUrism-related dollars in the state in 2~08 WeRtattti~lltilbJe to spending by 

'international ti'avel~$. It is especiQily w.<1rtlt noting in tbis eontext that. visitors. from Ja:pan 

nwnbefed 6,29,000. scconP only to th~ United Kingdom at 8t3;000 fQl' top overseas visitor markets. 

During,2008, travel spending in Califomiadireotlysu.pported 924;000 jobs, with earnings of$3'0.6 

billion. It sta11ds to teasontbata more robust ~vel market betWeetl Japan.andthe'United States 

would b9os~ j)vers~ t()\Ui$fl f\ntli!'1'at a time when prlvate:indU$tl'Y - iitcl\1d!ng l)~1' airlines - ~d 

CalltonUll, IJIld the {I~iQn ~s ,a. wbole f~_ n¢a:rlY tmpreced~nted ec.anomic chaitenges.. 

As I Wrote to you in December,.to achieve these goals; I remain supportive olthe QilUae antitrust 

iininunity envisiolled under the OpCh Skies Agreement. provided that the applications- ultimately 

approved ¢nsu,re healthy competition betWeen the! OOmpeu1l8 catti:ers.artd th~Jr 1'e$pi!lotive allianoes. 1'h~ .~plicwtiofiS being purs~ed by Amert~ Ai:rUnI;$. United Ait1mes~ Continental and otherswiJl 

ultimately benefit California and the United States. ;\pproval of these applications wou~4 allow 

these, airlines to generate sl$.nitlcant price .and service benefits for conswners, help preserve and 

enhance service to communities throughout the United States and compete more effectively with 

other internati~~ ajrIfnes and alliances. 

I urge you to ens~ that tbeseand otb~~ benefits are realized by seemg that this lonS'rawaited 

agreement is enacted. 

Sin~r<lly. 

Arnold Schwarzenegger 

/la 

STATE CAPITOL· SACRAMENto, CALIFORNIA 95814 • (9l6) "'4'·2M1 

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