BEFORE THE U.S. DEPARTMENT OF TRANSPORTATION WASHINGTON, D.C.

________________________________________ ) Application of ) ) NORWEGIAN AIR INTERNATIONAL LIMITED ) ) Docket No. OST

- 2013

- 0204 for an exemption under 49 U.S.C. § 4010 9 and ) a foreign air carrier permit pursuant to ) 49 U.S.C. § 41301 (U

. S

. - EU Open Skies) )

_________________________________________ )

REPLY OF NORWEGIAN AIR INTERNATIONAL LIMITED

Communications with respect to this document should be addre ssed to:

Asgeir Nyseth Josh Romanow Chief Executive Officer Peter Nelson NORWEGIAN AIR PILLSBURY WINTHROP SHAW INTERNATIONAL LIMITED PITTMAN LLP Ground Floor Imbus House 2300 N Street, N.W. Dublin Airport, Co. Dublin, IRELAND Washington, D.C . 20037 Tel: + 353 1 8 141851 Tel: (202) 663

- 8000 E

- mail: a sgeir. nyseth@norwegian.com E

- mail: romanow@pillsburylaw.com E

- mail: peter.nelson@pillsburylaw.com

August 25 , 2014 Counsel for NORW EGIAN AIR INTERNATIONAL LIMITED1 BEFORE THE U.S. DEPARTMENT OF TRANSPORTATION WASHINGTON, D.C.

________________________________________ ) Application of ) ) NORWEGIAN AIR INTERNATIONAL LIMITED ) ) Docket No. OST

- 2013

- 0204 for an exemption under 49 U.S.C. § 40109 and ) a foreign air carr ier permit pursuant to ) 49 U.S.C. § 41301 (U

. S

. - EU Open Skies) )

_________________________________________ )

REPLY OF NORWEGIAN AIR INTERNATIONAL LIMITED

Norwegian Air International Limited ( “ Norwegian International ” ) hereby submits
its reply to the answers filed in accordance with the Department’s Notice of August 4,
2014 (the “ Notice ” ). Along with the Irish Civil Aviation Authority, the U.S. Travel

Association, the American Society of Travel Agents, the European Low Fares Airline

Association
, t he Oakland
, Orlando , and F ort Lauderdale airport authorities, Federal

E xpress, Atlas Air, and many others 1 (the “ Supporting Parties ” ) and on behalf of an
American public that has waited too long for competitive transatlantic service,

1 See Letter, dated July 30, 2014, from John J. Fearon, Director General of Civil Aviation, Irish Department of Transport, Tourism, and Sport to Secretary F oxx; Letter, dated August 18, 2014 from Roger Dow , President and CEO, U.S. Travel Association to Secretary Foxx; Comments of the American Society of Travel Agents (Aug. 18, 2014 ); Answer of the European Low Fares Airline Association (Aug. 18, 2014) ; Answer of Federal Express Corporation (Aug. 18, 2014) (hereinafter “FedEx Answer”); Comments of Atlas Air, Inc. (Aug. 18, 2014) (hereinafter “Atlas Answer”); Answer of the Port of Oakland (Aug. 18, 2014) ;; Answer of the Washington Airports Task Force (Aug. 18, 2 014); Answer of Broward County Aviation Department (Dec

. 1 6 , 2013) ; Letter from Greater Orlando Aviation Authority to Secretary of Transportation Anthony R. Foxx (Jan

. 13, 2014) ; Motion for Permission to File and Comments of the Travel Technology Associati on in Support of Norwegian Air International Limited (January 22, 2014) ; Letter from Orlando Mayor Buddy Dyer to Secretary of Transportation Anthony R. Foxx (January 27, 2014) ; Letter from Orange Country Mayor Teresa Jacobs to Secretary of Transportation A nthony R. Fox (Feb. 5, 2014); Letter from Visit Orlando to Secretary of Transportation Anthony R. Foxx (Jan

. 24, 2014) ; Comments of Travelers United (Aug. 18, 2014).2 Norwegian Internationa l urges the Department to grant its application for an exemption
and a foreign air carrier permit without further delay.

I. THE VIEWS OF THE EUROPEAN COMMISSION ARE CORRECT: ARTICLE 17 BIS DOES NOT PROVIDE A BASIS FOR THE DEPARTMENT UNILATERALLY TO DENY NO RWEGIAN INTERNATIONAL'S APPLICATION
At the July 14 meeting, the Commission presented its views on the legal meaning
and applicability of Article 17 bis

. Specifically
, “ Article 17 bis does not provide a legal
basis for unilaterally denying an application under Article 4 because (1) Article 4 makes

no reference to Article 17 bis
, and (2) Article 17 bis itself does not formulate a legal rule
that can be applied unilaterally by one party. ” 2 And
, “ any unilateral decision to deny an
application using Article 1 7 bis runs against the letter and spirit of the Agreement. ” 3

Opposing Parties have offered a capacious but indigestible smorgasbord of assertions
disagreeing with the Commission’s well

- reasoned conclusions but have not provide d any
supportable legal basis to deny Norwegian International’s application

. As explained
below, each of the Opposing Parties’ principal arguments fail s

.
1. Article 17 bis Does not Establish a Legally Binding Rule
Opposing Parties 4 incorrectly argue that Article 17 bis empowers each Par ty with
the unilateral authority to deny authorization to an airline of the other Party if it judges

the applicant’s labor standards inconsistent with its own, unilaterally defined notion of

2 Department of Transportation, Notice at 2 , Docket DOT

- OST

- 2013

- 0204 (Aug. 4, 2014) (here inafter “Notice”)

. 3 Id. at 3.

4 Joint Comments of Air Line Pilots Association, Transportation Trades Department, AFL

- CIO and the European Cockpit Association, at 8 (Aug. 18, 2014) (hereinafter “ALPA Answer”); Comments of the Air Crew Working Group, at 3 ( Aug. 18, 2014) (hereinafter “ ACWG/ECA Answer ”) ; Joint Submission of the European Transport Workers’ Federation and the Transportation Trades Department, AFL

- CIO, at 3 (Aug. 18, 2014) (hereinafter “ ETF/TTD Answer ”).3 high labor standards

. 5 Specifically, Opposing Parties assert tha t the words “shall guide”

are directive, 6 and that the Commission’s interpretation would render Article 17 bis

null. 7 These assertions are simply wrong.

First, “ guide ” does not indicate a legal obligation, whether or not it is paired with

“ shall. ” Citin g the Merriam

‐ Webster Dictionary, 8 ALPA asserts that the definition of
guide is “ to direct . . . to a particular end. ” Tellingly, ALPA’s Answer omits with a
quaint ellipsis several crucial words in the definition: “ to direct, supervise, or influence
usually to a parti cular end. ” Neither “supervise” nor “ influence ” nor “ usually ” is
mandatory, and “ influence ” is the more appropriate interpretation in this case. Moreover,
the same dictionary’s examples distinguish “ guide ” from a “ directive ” as Opposing
Parties interpret it. 9 Furthermore, “ guidance ” is routinely used to refer to non

- mandatory
provisions in the context of international aviation, including in formal documents of the

U.S.

- EU Joint Committee (the “Joint Committee”) and in ICAO

. 10 Further, “ guide ”

cannot be d eemed mandatory in this context because Article 17 bis did not establish or

5 See FedEx Answer at 3 (“Despite the fac t that certain interests wanted to use this Agreement as a springboard to a trans

- Atlantic labor stand ard, that was not the result.”). The Opposing Parties have not provided their definition of “high labor standards,” but presumably would “know it when th ey see it.” Cf. Justice Stewart’s concurring opinion in Jacobellis v. Ohio, 378 U.S. 184 (1964), regarding the question of what constitutes obscenity.

6 ALPA Answer at 9.

7 Se e, e.g. , Answer of Scandinavian Airlines System, at 3 (Aug. 18, 2014) (hereinaft er “ SAS Answer ”)

. 8 Available at www.merriam

‐ webster/dictionary/guide

. 9 The dictionary examples show that to the extent guide may mean “direct,” it has the connotation of “orient” or “lead” rather than “order” or “bind.” See id

. (“Let your conscience guid e you,” “programs to hel p guide teenagers away from drug use ,” “In his work, he has always been guided by a desire to help other people.”)

. 10 See, f or exam ple, the Joint Committee Record of Meeting of June 22, 2011 at http://www.state.gov/e/eb/rls/othr/ata /e/eu/192088.htm ( “ supporting ICAO in the development of appropriate guidance material and recommendations for ICAO Contracting States ” with respect to the screening of liquids, aerosols, and gels ) and the ICAO “Guidance Document” on “New Lithium Battery Packing Instructions and Recommended Transitional Period” at http://www.icao.int/safety/DangerousGoods/Documents/Guidance%20Material/2013

- 2014LithiumBatteryTransition.pdf (stating explicitly that “it is recommended that aviation authorities provide for a t ransitional period”)

.4 define either mandatory or prohibited labor standards, i.e. , there is no clear directive. 11 In

short, the characterization of “ shall guide ” as providing “ marching orders for the Pa rties ”
is patently wrong, as are the parallel arguments of other Opposing Parties. 12

Second, Article 17 bis has real meaning

. As Opposing Parties should know,

h ortatory statements are commonly used in international agreements
, 13 and here, Article

17 bis li nks the “ further expansion of opportunities ” envisioned in Article 21 with the
guidance to the Parties on the social dimension in Article 17 bis

. As both articles make

clear, the Joint Committee bear s responsibility for defining how to achieve expanded

op portunities in a manner consistent with social dimension concerns. 14 The
Commission’s interpretation would in no way render the provision a nullity.

2. Article 17 bis Does not Empower a Party to Unilaterally Deny Operating Authority to an Airline of the Other Party.
Opposing Parties ’ arguments that Article 17 bis provides for unilateral action are
without any supportable basis.

First, t he reference to “ Parties ” in paragraph 2 of 17 bis does not mean that “ each
of the parties ” is empowered to act unilaterally. 15 As NAI stated in its August 18 Answer,
the Open Skies Agreement repeatedly uses the singular of “ Party ” in other contexts

where “ a Party ” or “ each Party ” or “either Party” 16 is intended and unilateral action is

11 See Consolidated Reply of Norwegian Air International Limited, at 8, 11 ( Dec. 31, 2013 ) (hereinafter, the “ Consolidated Reply”)

. 12 See ALPA Answer at 10 ; ACWG/ECA Answer at 3.

13 See, e.g.
, Comments of Norwegian Air International Lim ited, at 6 n

. 11 (Aug. 18, 2014) (hereinafter

“ Norwegian International Answer ”)

. 14 Id. at 11

- 12.

15 See, e.g. , ALPA Answer at 8 ; see also ACWG/ECA Answer at 3.

16 Tellingly, Article 5 of the Open Skies Agreement (Revocation of Authorization) states that “Eit her Party may revoke, suspend, or limit the operating authorizations ... or otherwise suspend or limit the operations of an airline of the other Party” in certain specified circumstances (which, it must be noted, do not include5 contemplated

. Moreover, the Agreement uses “ each Party ” in at least ten other articles, 17

but notably not in paragraph 2 of Article 17 bis

. 18 That context demonstrates that “each

of the Parties” was not intended.

“ Including ” as used in 17 bis does not imply that unilateral denial of an
application for authorization is permitted. 19 “ Including ” modifies “ as they implement the

Agreement ”

– with “ they ” being plural. The only specific implementation actions

enumerated

— “ regular consideration by the Joint Committee ” and “ development of
appropriate respon ses ”

— are joint , not unilateral, actions. 20 Thus any additional
implementation would be pursued as the other actions would be

– jointly. 21 Opposing
Parties cannot therefore credibly interpret the second paragraph of Article 17 bis

— which

refers to “ the Part ies ” and contains references solely to joint actions

— as a legal basis for
unilateral action by “ a Party. ” 22

Opposing Parties attempt to bolster the linguistic deficiencies of their
interpretation with policy arguments. As a preliminary matter, policy argu ments are not
among the accepted sources of treaty interpretation under international law, and
assertions related to the presumed intent of the Parties serve only as supplementary aids

any reference to Article 17 bi s or the “social dimension”). This is a case in which the Agreement empowers unilateral action by an individual Party

— to do so, it uses “Party” in the singular.

17 See Open Skies Agreement arts. 2

- 3, 6 bis , 9

- 12, 14

- 15, 19, 21 (as amended by 2010 P rotocol)

. 18 Cf. Open Skies Agreement, art. 17 bis ¶ 1 (referring to “Parties’ respective laws,” which like “each party” refer to individual parties). Article 17 bis ¶ 2 contains no such “respective” reference. Note that “respective” in ¶ 1 means that “each parti cipating nation would retain and enforce its own laws on its own carriers, rather than creating a new standard to which all parties would adhere.” See FedEx Answer at 3

. 19 See, e.g. , ALPA Answer at 9 ; ACWG/ECA Answer at 3.

20 See Norwegian International An swer at 8. 21 See also Atlas Answer at 3 (“If the U.S. government believes that a Member State has licensed an EU airline in violation of Article 17 bis , its sole recourse is to submit the issue to the Joint Committee for consideration pursuant to Article 1 8.”).

22 Opposing Parties’ logic might even open the door to a Party’s denying authorization to an airline of the other Party that it unilaterally judges deficient in “protecting the environment

. ” See Open Skies Agreement art. 15 ( “The Parties recognize the importance of protecting the environment”).6 of interpretation where the meaning of a provision is ambiguous.

That s aid, Opposing Parties present a circular argument that because the Joint
Committee may not be “in a position to take timely action” before the Department must
meet a statutory deadline, 23 the Article must therefore be interpreted to authorize

unilateral act ion

. 24 The absence of any reference in Article 4 to Article 17 bis , reinforced
by the use of “ the Parties ” and the explicit reference to the Joint Committee in the text,
signifies that unilateral decisions with respect to social dimension matters are
inapp ropriate in an Article 4 licensing decision. 25

Opposing Parties’ jingoistic argument that a requirement for joint consideration of

Article 17 bis issues “allow [s] a foreign country veto power” 26 is likewise without legal

basis. U nder international law, inte rnational agr eements are binding on the U.S. I t is the
very nature of international agreements

— and a necessary attribute of any State’s
sovereignty

— to have the capacity to undertake such binding obligations

. T he U.S. has

done so he re, and the United Sta tes is bound to comply with them under the principle of
pacta sunt servanda

. 27 Further, 49 U.S.C. § 40105(b) (1)(A) mandates that the Secretary

“ shall act consistently with obligations of the United States Government under an

23 See ALPA Answer at 9.

24 The Opposing Parties make the assumption that “social dimension” requirements are at the core of an Article 4 licensing decision and then argue backwards to a requirement for unilateral action to satisfy the deadline concern.

25 The European Commission’s tentative contemplation that “perhaps two parties could decide together to deny an application using Article 17 bis based on paragraph 1 of Article 17 bis (i.e., that an application under mines labor

- related rights and laws)” envisions only joint, not unilateral, action. See Notice at 3. This hypothetical situation is not at issue in this proceeding since both the Commission and Ireland have spoken.

26 See ALPA Answer at 11.

27 “ Every treat y in force is binding upon the parties to it and must be performed by them in good faith. ” Vienna Convention on the Law of Treaties art. 26
, opened for signature May 23, 1969, 1155 U.N.T.S. 331 (hereinafter “VCLT”)

.7 international agreement. ” 28 In this case, the United States has undertaken the obligation
in Article 4 of the Open Skies Agreement to grant operating authorization to EU airlines
when specified conditions, not including Article 17 bis , have been met. It was neither
“irrational” nor “pl ainly impermissible ”

— as suggested by Opposing Parties

— for the
Parties to have entered into this reciprocal legal obligation

. 29 It is not the grant of a
“veto” to act consistently with this legal obligation.

3. The Social Dimension Concerns of Article 17 bis A re N ot the Core Object and Purpose of the Open Skies Agreement.
Opposing Parties ’ suggestion that the core objectives of Article 17 bis would be
fatally undermined if the Department approves Norwegian International’s application 30

misses the point

. Under the Vienna Convention on the Law of Treaties
, the object and
purpose to be considered is that of the full Agreement and not just one article. 31 The core
object and purpose of the Open Skies agreement i s to open aviation markets. 32 Moreover,
approval by the Department of operating authority for Norwegian International is

consistent with Article 17 bis
, which contemplates joint and cooperative action.
Opposing Parties’ attempts to downplay the realistic possibility of retaliation for a

unilateral denial 33 igno re the negotiating delegations ’ express recognition that “ in the
event a Party would take measures contrary to the Agreement, including Article 21, the
other Party may avail itself of any appropriate and proportional measures in accordance

28 See, e.g. , DOT, Notice of Action Taken
, Docket DOT

- OST

- 2007

- 0029 (Apr. 4, 2008) (hereinafter “ Arik, Docket DOT

- OST

- 2007

- 0029 ”) (granting exemption where “in view of [the Department’s] obligations to act consistently with international agreements (in this case, the U.S.

- Nigeria Air Transport Ag reement), and the public benefits that will be derived”).

29 See ALPA Answer at 10

- 11.

30 Joint Answer of Delta Air Lines, Inc., United Airlines, Inc., and American Airl ines, Inc., at 2 (Aug 18, 2014).

31 VCLT art. 31(1) (“ A treaty shall be interpreted...in t he light of its object and purpose ” )

. 32 See Norwegian International Answer at 9.

33 See ETF /TTD Answer at 5.8 with internation al law, including the Agreement. ” 34 The statement by the Commission
that a unilateral denial using Article 17 bis runs against the letter and spirit of the
Agreement is simple fact. 35

4. Articles 4 do es not refer to Article 17 bis

– confirming that Article 17 bis may not be used unilaterally to deny a license application.
Opposing Parties ’ wrongly contend that cross

- referencing article would render the

Agreement unworkable

. 36 However, the article of the Agreement that matters is Article 4,
and Article 4 explic itly references other Agreement articles 37 with respect to which
compliance is relevant to an authorization decision. Article 17 bis is not referenced, and
it beggars reason to contend that such a reference would have rendered Article 4

unworkable. Indeed , the exalted status that the Opposing Parties attribute to Article 17

bis would seem to cry out for a cross

- reference in Article 4, had the Parties intended to

allow unilateral denial on that basis. 38 They did not. 39

Opposing Parties also attempt to have Article 17 bis three ways. First, t he ir
suggestion 40 that Article 17 bis is itself a U.S. law or regulation is unsupported

. 41 As

34 Memorandum of Consultations signed by Daniel Calleja and John Byerly, ¶ 20, Mar. 25, 2010.

35 Notice at 3.

36 See SAS Answer at 3.

37 Open Skies Agre ement arts. 8 & 9.

38 Expressio unius est exclusio alterius (“The expression of one thing is the exclusion of another”) also forecloses Opposing Parties’ arguments that “there is no language in Article 4 stating that Article 17 bis does not apply.” See Resp onse of KLM Royal Dutch Airlines at 3 (Aug. 18, 2014) (hereinafter “KLM Answer”); Response of Air France at 2 (Aug. 18, 2014) (hereinafter “Air France Answer”); see also ALPA Answer at 10

. 39 See Norwegian International Answer at 7; FedEx A nswer at 3 ( “ [ P ] a rties did not add any other factor to Art icle 4 upon which a unilateral rejection could be based. ”)

. 40 See SAS Answer at 4 ( “Article 17 bis does “formulate a legal rule” that can be applied to an Article 4(c) application.”); ACWG/ECA Answer at 3

- 4 (“ Art 17 bis is such a “normally applied regulation” to which the U.S. is obliged to abide to and is entitled to refer to unilaterally.”); KLM Answer at 4 (“ Those “laws and regulations” should include in our view the protection of the “high labor standards” secured by Article 17 bis ”); Air France Answer at 3 ( s ame)

. 41 Compare, for example, the “standard exemption conditions” the Department issues with foreign air carrier exemption approvals, such as those identified in Arik, Docket DOT

- OST

- 2007

- 0029, at 3. Arik conce rned9 used in Article 4(c) “l aw s and regulation s” clearly refer to national laws or regulations
rather than a treaty clause. Not su rprisingly, the Opposing Parties offer no legal
argumentation for their contrary view

. Second, j ust as incorrect is the twinned assertion
that, with respect to exemptions, the principal “ law normally applied ” is 49 U.S.C. §

40109 42 and that Article 17 bis “ should be part of the public interest analysis ” envisioned

in that section. 43 For the reasons provided above, the Commission’s correct legal view

that Article 17 bis does not provide a legal basis for unilaterally denying an application
under Article 4 pr ecludes unilateral denial based “ in part ” on Article 17 bis . Dressing up

Article 17 bis in the garb of “ public interest analysis ” does not change this conclusion.

Third, as stated by the Commission, the argument that Article 17 bis offers an
independent basis, separate from Article 4, for denying authorization is contrary to the

terms and context of Articles 4 and 17 bis

.

5. Opposing Parties’ Comments on the July 14 Meeting and the Role and Authority of the Director Do Nothing to Salvage Their Legal Analysis

. The Opposing Parties have also attempted to mischaracterize the July 14 meeting

in a last

- ditch effort to cast shadows in an area where there is total sunlight , including an

implicit suggestion that Secretary Foxx’s initiative to request th e meeting was misguided

.
Norwegian International respectfully disagrees.

the U.S.

- Nigeria Air Transportation Agreement. Article 3(2)(b) of that Agreement contains the same language Opposing Parties misapply here: “conditions prescribed under the laws and regulations normally applied.” By their terms and by their content, the “standard exemption conditions” in Arik appear to be (1) “conditions prescribed,” (2) under U.S. “laws and regulations,” and (3) “normally applied.” In contrast, Article 17 bis itself is none of these

. 42 ALPA Answer at 4.

43 Id. at 7

.10 On very short notice and at the request of the Secretary , the U.S. Government

made “a request ... to the European Commission’s Directorate General for Mobility and

Transport ( “ DG MOVE ” ) to ask for its views on the legal meaning and applicability of

Article 17 bis .” 44 Present at the meeting were senior representatives of DG MOVE as

well as an official of the Commission Legal Service. The Department reported in the

Notice that the Director “noted tha t the views expressed during the meetings were the

views of EC officials.” In other words , the meeting produced exactly what the U.S.

Government requested.

Opposing Parties did not like what the Director said and decided to “blame the

messenger” by quest ioning his aut hority, attacking the Commission views that were

expressed , and asserting

— without evidence

— that some EU Member States may have

different views. 45 The Department should attach no weight to these fulminations

.

II. THE GRANT OF AN EXEMPTION AND A FOREIGN AIR CARRIER PERMIT TO NORWEGIAN INTERNATIONAL IS IN THE PUBLIC INTEREST

Pursuant to 49 U.S.C. § 40105(b)(1) (A) , the Department is required to “act
consistently with the obligations of the United States Government under an international

agreement .” 46 As Norwegian International has stated in previous filings, the public
interest in promoting service authorized by a bilateral air transport agreement weighs

44 Notice at 1

. 45 See, e.g. , ALPA Answer at 3.

46 49 U.S.C. § 40105(b)(1) (A)

.11 decisively in favor of the grant of an exemption and foreign air carrier permit in this

procee ding. 47 In the permit context, Congress demonstrated its regard for authorizing
service “under an agreement with the United States Government” by dispensing with the
requirement for a public interest finding. That is, once the Department has determined

th at an applicant is “fit
, willing
, and able” to provide foreign air transportation, 49 U.S.C.
§ 41302 authorizes the Department to grant a permit either if the applicant has “been
designated to provide the foreign air transportation under an agreement with the U.S.
Government” or if “the foreign air transportation to be provided under the permit will be
in the public interest.” 48

Analogous logic applies to the public interest determination required for approval
of Norwegian International’s exemption applicati on under 49 U.S.C. § 40109. Congress
has stated that if an applicant seeks to provide service authorized by a bilateral
agreement, there is a “ virtually unrebuttable presumption that grant of the application is
in the public interest. ” 49 In addition , one of the factors the Department must consider in
evaluating the public interest in the context of international air transportation is
“opportunities for carriers of foreign countries to increase their access to . . . the United
States if exchanged for benefi ts of similar magnitude for [U.S.] air carriers or the

47 Norwegian International notes that in previous cases, the Department has allowed obligations under international agreements to outweigh provisions of U.S. law ( see Arik , Docket DOT

- OST

- 2007

- 0029 , at 1 (approving exemption requested by Arik Air Limited despite expected fuel consumption in excess of 10 million gallons “in view of [the United States’] obligations under 49 U.S.C. 40105 to act consistently with international agreements . . . and the p ublic benefits that will be derived from Arik’s services ” ).

48 49 U.S.C. § 41302.

49 H.R. REP. NO. 95

- 1211, at 15 (1978) ; s ee also Attachment to Joint Applications of Delta/Air France (#98

- 303) and Continental/Air France (#98

- 330) for Statements of Authoriza tion under 14 CFR 212 (Aug. 6, 1998) (“It is our policy in determining the public interest to consider a number of factors, most importantly, the extent to which the authority sought is covered by and consistent with bilateral agreements.”); S. REP. NO. 96

- 329, at 4 (1979), reprinted in 1980 U.S.C.C.A.N. 54, 57 (“[T]he negotiation of a bilateral agreement itself represents a determination by the Government of the United States that the grant of route authority provided for under the bilateral is in the ‘pub lic interest.’”).12 traveling public

. ” 50 Approval of Norwegian International’s application will enable the
Department to protect the important opportunities made available to U.S. carriers by the
European parties to the O pen Skies Agreement, 51 and afford an airline of Ireland, one of
America’s closest partners in Europe, the access to route authority it was promised.
Viewed as a whole, the other factors identified in 49 U.S.C. § 40101(e) leave no
doubt that Norwegian Intern ational’s proposed service would serve the public interest.
As described in its prior filings, Norwegian International will offer the American public
competitive fares ((e)(2)), award

- winning service that is responsive to market preferences
and demand ((e )(4), (5)), increased service to previously

- underserved markets ((e)(7)),
and support for the U.S. aviation industry through its multibillion

- dollar commitment to
Boeing, hiring of hundreds of U.S.

- based cabin crew, and support for hundreds of jobs at

the U.S. airports it serves ((e)(10)). In addition, even though Norwegian International is a

new entrant carrier, the exaggerated reactions of the Opposing Parties to its application
are evidence enough that Norwegian International will also advance the Depar tment’s
goal of promoting competition among airlines 52

– i ncluding reducing the extraordinary

concentration of transatlantic traffic currently dominated by the three immunized

alliances.
Going beyond the scope of the Department’s Notice, Opposing Parties ha ve once
again used their Answers to rehash tired innuendo about the safety and working

conditions of Norwegian International

. First, w ith respect to safety
, Norwegian
International is subject to Irish oversight and, as the Irish Minister for Transport, To urism

50 49 U.S.C. § 40101(e)(8).

51 See Consolidated Reply, at 9

- 12.

52 See 49 U.S.C. § 40101(f).13 and Sport conveyed to Secretary Foxx, Ireland’s “safety . . . regimes are based on EU law
and also in accord with all applicable ICAO requirements. Our safety oversight regime
has been recognized as among the best in the world by ICAO under the Univ ersal Safety
Oversight Audit Program.” 53 Norwegian International fully complies with all applicable
safety standards
, and its crews are trained according to EU standards

– in addition to its
own rigorous, supplemental training programs. No basis exists fo r the wildly inaccurate

assertion that Norwegian International is somehow “unsafe.”
Second, as made clear in the Department’s January 30, 2014 Notice, to secure
qualif ied crew members in a way that makes economic sense for routes that have only a few

weekl y frequencies to and from certain European cities, Norwegian International intends to
hire and domicile crews at operating bases outside of Europe ( for example, in the United

States for U.S.

- Europe flights). 54 On August 22 Norwegian announced a new long

- h aul pilot

base at London Gatwick, 55 which will complement its existing crew bases in New York and

Fort Lauderdale. In each case, the local labor laws of the country in which an individual
employee is hired and domiciled will apply. The European Delegation to the Joint

Committee has noted that Norwegian “ employees are organized in labor unions and that
[Norwegian International’s affiliate, Norwegian Air Shuttle ] had no traditi on of discouraging

unionization, ” 56 and has also provided the Joint Committee with information about the
salaries paid to Norwe gian crew, which are are competitive for the market place. 57 The

53 Letter dated February 13, 2014, from Leo Varadkar, Irish Minister for Transport, Tourism & Sport to Secretary Anthony Foxx.

54 Department of Transp ortation, Notice at 2 , Docket DOT

- OST

- 2013

- 0204 (J an. 30, 2014) (hereinafter

“ January Notice”)

. 55 Press Release, Norwegian Opens New Base for Long

- Haul Operations at London Gatwick (Aug. 22, 2014), available at http://media. norwegian.com/en/#/pressreleases/norwegian

- opens

- new

- base

- for

- long

haul

- operations

- at

- london

- gatwick

- 1043088

. 56 January Notice, at 2.

57 Id

.14 information provided to the Joint Committee puts to rest any questions about Norwegian
International’s employment conditions.

I I I. OPEN THE SKIES OR TURN BACK THE CLOCK: THE DEPARTMENT’S STARK CHOICE
In 1994, the Departm ent issued its pivotal Statement of United States
International Air Transportation Policy

— a policy that has guided the Department in its

aviation relations with other countries for over two decades. In it, t he Department

concluded:
We are living through a period in which international aviation rules must change. Privatization, competition, and globalization are trends fueled by economic and political forces that will ultimately pre vail. Governments and airlines that embrace these trends will far outpace those that do not. The U.S. government will be among those that embrace the future. 58

Fast forward twenty years, and a small European airline with aspirations to enter

the U.S. mark et and provide tremendous benefits to the American traveling public has led
legacy carriers and their unions to challenge the Department’s core goals in this Policy

Statement. Over six months after Norwegian International completed its application and

wit h a regulatory docket filled with hundreds of pages of pleadings, the Department must

now make a deci sion. It is a stark choice.
On the one hand, the Department can bow to the overt political pressure from
special interests, who seek to block a new compet ito r on transatlantic air routes. There

can be no mistake about the anti

- Open Skies agenda of Norwegian International's

opponents

. 59 If the Department wishes to return to the “ good ol’ days ” of Bermuda 2

58 Statement of United States International Air Transportation Policy, Office of the Secretary, Department of Transp ortation
, 60 Fed. Reg. 21,841 (May 3, 1995).

59 One leading U.S. union official captured this agenda exquisitely when he recently called for a “grey” “path forward for global aviation,” arguing that “protectionism” should now be given equal billing with the15 capacity and designation limits, pricing wars with G ermany, incumbent “ haves ” and non

incumbent “ have

- nots ” in Japan, and a focus on bolstering the stature of today ’ s
successors to PanAm, the protectionist positions advanced by the Opposing Parties offer
the path backward. If it follows this path, the Depa rtment will invite an unnecessary,
potentially grave dispute with the European Union and Ireland. Moreover, the
Department will have further entrenched the power of the three immunized alliances and
their unions on both sides of the Atlantic by denying a new entrant the chance to

compete.
On the other hand, the Department can make the right decision by granting
authority to Norwegian International, a n airline that offers America's consumers a choice

and America’ s communities and airports new opportunities to expand tourism, build
international connections, and foster economic development

. Since 1992, the United
States has pursued an Open Skies policy that puts consumers

— the American public

—

first. Open Skies has succeeded beyond all expectations, and it h as done so because
America took a principled decision to focus on fostering competition and new
opportunities, not on protecting the existing market shares of flag carriers. T o stay the
successful course of Open Skies and promote a pro

- growth, pro

- competi tion, pro

consumer policy, the Department should grant Norwegian International ’s application
without further delay

.

principles of liberalization that have defined America's Open Skies policy for over twenty years. Captain Lee Moak, In the Grey
, A IR L INE P ILOT (Aug. 2014).16 Respectfully submitted,

Josh Romanow Peter Nelson

PILLSBURY WINTHROP SHAW PITTMAN LLP 2300 N Street, N.W. Washington, D.C. 20037 Te l: (202) 663

- 8000 Fax: (202) 663

- 8007 romanow@pillsburylaw.com peter.nelson@pillsburylaw.com

August 25 , 2014 Counsel for NORWEGIAN AIR INTERNATIONAL LIMITEDCERTIFICATE OF SERVICE
The undersigned certifies that on August 25 , 2014
, a true and correct cop y of the foregoing Reply of Norwegian Air International Limited was served by electronic mail on the individuals identified below:

Dan Weiss United Airlines dan.weiss@united .com

Sascha Van der B ellen Delta Airlines sascha.vanderbellen@delta.com

Malcol m L. Benge Counsel for North American/World Airways mlbenge@zsrlaw.com

Russell E. Pommer Atlas Air Inc. rpommer@atlasair.com
Russell Bailey Jonathan A. Cohen Air Line Pilots Association, Int’l russell.bailey@alpa.org jonathan.cohen@alpa.org
Edward Wytki nd Transportation Trades Department, AFL

- CIO edw@ttd.org
J. Christopher Lytle Port of Oakland clytle@portoakland.com

Kent George Broward County Aviation Department kgeorge@broward.org

Mark Richardson Southwest Airlines Pilots’ Association mrichardson@sw apa.org

Robert Wirick Francis Heil Howard Kass American Airlines, Inc. U.S. Airways, Inc. robert.wirick@aa.com francis.heil@aa.com h oward.kass@ aa .com

Airline Info info@airlineinfo.com Nick Tsokris Jesse Elliot John Chen FAA New York IFU jesse.elliot@faa .gov nicholas.tsokris@faa.gov john.chen@faa.gov

John M. Allen Director, Flight Standards Federal Aviation Administration john.allen@faa.gov

Anita Mosner Jennifer Nowak Counsel for UPS Holland & Knight anita.mosner@hklaw.com jennifer.nowak@hklaw.com

Nanc y S. Sparks Bailey Leopard Federal Express Corporation nssparks@fedex.com gbleopard@fedex.com
David Berg James L. Casey Keith A. Glatz Airlines for America dberg@airlines.org jcasey@airlines.org kglatz@airlines.org

Celine Canu European Cockpit Associatio n cc@eurocockpit.be
Edgar N. James Allied Pilots Association ejames@jamhoff.com
Thomas S. Engle Department of State EngleTS @state.gov

Steve Shur Travel Technology Association sshur@traveltech.org
Eugene Alford Department of Commerce eugene.alford@trade .gov Matthew Baldwin Director of Air Transport European Commission Matthew.Baldwin@ec.europa.eu

Emmanuelle Maire DG MOVE European Commission Emmanuelle.Maire @ec.europa.eu

David Batchelor SESAR Joint Undertaking Delegation of the European Union to the U SA David.Batchelor@sesarju.eu

Ottar Ostnes Director General, Norwegian Ministry of Transport and Communications Ottar.Ostnes@sd.dep.no

John Hanlon European Low Fares Airline Association John.Hanlon@ELFAA.com

Paul Gretch Robert Finamore U.S. Department of Transportation paul.gretch@dot.gov Robert.Finamore@dot.gov

Charles Leocha Travelers United Charles.Leocha@travelersunited.org

Keith Meurlin Washington Airports Task Force keith@washingtonairports.com

Paul Ruden American Society of Travel Agents pr

uden@asta.org

Roger Dow U.S. Travel Association rdow@ustravel.org

/s/ Peter Nelson Peter Nelson