UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY WASHINGTON, DC

Issued by the Department of Transportation on March 11, 2010

NOTICE OF ACTION TAKEN -- DOCKETS DOT-OST-2 005-20122 and DOT-OST-2010-0020

_____________________________________________________________________________________________________________________ This serves as notice to the public of the action d escribed below, taken by the Department official indicated (no additional confirming orde r will be issued in this matter).

1. Docket DOT-OST-2005-20122

Application of CONTINENTAL AIRLINES, INC. (Continental), filed 1/21/2010 for:

XX Amendment of exemption under 49 U.S.C. 40109 to the extent necessary to permit Continental to display its designator code on flights operated by its foreign code-share pa rtners on the following

services:

Scheduled foreign air transportation of persons, property, and mail between points in the United States and points worldwide on a third-country co de-share basis pursuant to blanket code-sharing statements of authorization previously approved by the Department. 1 2

2. Docket DOT-OST-2010-0020

Joint Application of CONTINENTAL, CONTINENTAL MICRONESIA, INC. (Continental Micronesia), COLGAN AIR, INC. (Colgan), and SCANDINAVIAN AIRLINES SYSTEM (SAS)

, filed 1/21/2010 for:

Blanket statements of authorization to permit Continental to display the (SK*) designator code of SAS on Continental flights and SAS to display the (CO*) designator code of Continental on SAS flights in conjunction with foreign air transporta tion of persons, property, and mail on flights: 1) between any point or points in the United States and any point or points in any European Union (EU) Member State or Norway (either nonstop or via intermediate Open Skies points); 2) between any point or points in the U.S. and any other po int or points in the European Common Aviation Area where an Open Skies agreement is being app lied; 3) between U.S. points; 4) between EU points; 5) between points in Norway; 6) between po ints in the EU and points in Norway; 7) between the EU or Norway, and any Open Skies point or points; 8) beyond the EU or Norway to any point or points; and 9) beyond the U.S. to any point or points. 3

1 The authorized foreign carriers are: Compania Panamena de Aviacion, S.A. (COPA); Air Canada; Jazz Air LP d/b/a Air Canada Jazz (Air Canada Jazz); British Midl and Airways Limited d/b/a bmi (bmi); British Midland Regional Limited d/b/a bmi Regional (bmi Regional); Deutsche Lufthansa AG (Lufthansa); Lufthansa Cityline GmbH (Lufthansa Cityline); Air Dolomiti S.p.A. LARE (Air Dolomiti); Augsburg Airways GmbH (Augsburg); PrivatAir GmbH; PrivatAir S.A.; Contact Air Flugdienst GmbH & Co. (Contact Air); Eurowings Luftverkehrs AG (Eurowings); Cirrus Airlines Luftfahrtgesellschaft mbH (Ci rrus Airlines); Asiana Airlin es, Inc. (Asiana); and Air

New Zealand. See Notices of Action Taken on October 21, 2009, in Dockets 2005-20122, DOT-OST-2009-0173,DOT-OST-2009-0174, and DOT-OST-2009-0175; November 20, 2009, in Dockets 2005-20122 and DOT-OST2009-0277; and January 26, 2010, in Dockets DOT-OST-2005-20122 and DOT-OST-2009-0340.

2 Continental requests that its blanket co de-share exemption authority be amended to the extent necessary to permit it to also place its designator code on flig hts operated by SAS through March 5, 2011, coextensive with its existing exemption authority in Docket DOT-OST-2005-20122.

3 The joint applicants state that unless the context of th eir application requires otherw ise, the term “Continental” includes Continental Micronesia and Colgan. The joint applicants note that Continental Micronesia and Colgan willApplicant reps: R. Bruce Keiner, Jr. (202) 624-2615 (Continental and Continental Micronesia), Brian T. Hunt (901) 346-6145 (Colgan), and Michael F. Goldman (202) 944-3305 (SAS)

DOT Analyst: Robert J. Finamore (202) 366-2405

D I S P O S I T I O N

XX Granted (subject to conditions, see below)

The above action granting amended exempti on authority is effective when taken : March 11, 2010

, through March 5, 2011 . The above action granting blanket statemen ts of authorization to the referenced

carriers is effective: March 11, 2010 , and will remain in effect indefi nitely, subject to conditions.

Action taken by: Paul L. Gretch, Director

Office of International Aviation

XX The authority granted is consistent with the U.S-Norway and U.S.-EU Air Transport Agreements.

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

indicated:

XX Continental’s certificates of public convenience and necessity

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

XX Conditions for statements of authoriza tion granted here (attached as Appendix B)

XX Conditions attached to previously gran ted blanket statements of authorization 4

_____________________________________________________________________________________________________________________ Remarks/Conditions: We note that Continental has conducted a safety audit of SAS under the Department’s Code-Share Safety Audit Program, and the FAA has advised us that it has reviewed the relevant audit report and fo und it to be acceptable.

The exemption authority granted here is for operations with the foreign code-share partners and affiliates named above, to include SAS. Should Continental and any additional code-sha re partner be granted statements of authorization, Continental will need to apply for exemption author ity to the extent necessary to permit Continental to display its code on flights operated by the new code-sha re partner and will need

to have conducted code -share safety audits of its foreign partners prior to receipt of authority for such

code-share services.

On the basis of data officially noticeable under Ru le 24(g) of the Departme nt's regulations, we found Continental qualified to provide the exemption ser vices authorized. Under authority assigned by the Department in its regulations, 14 CFR Part 385, we found that (1) our action was consistent with Department policy; (2) grant of the authority was cons istent with the public interest; and (3) grant of the authority would not constitute a major regulatory action under the Energy Policy and Conservation Act of 1975. To the extent not granted, we deni ed all requests in th e referenced Docket. We may amend, modify, or revoke the authority granted in this Notice at any time without hearing at our discretion.

not place their codes on flights operat ed by SAS, but SAS will place its code on flights operated by Continental Micronesia and Colgan.

4 See Notices of Action Taken dated July 9, 1998 (98-65, undocketed, Continental-COPA); October 21, 2009 (Dockets DOT-OST-2005-20122, DOT-OST-2009-0173, DOT-OST-2009-0174, and DOT-OST-2009-0175, Continental.-Air Canada and Air Canada Jazz, Continen tal-bmi and bmi Regional, and Continental-Lufthansa, Lufthansa Cityline, Air Dolomiti, Augsburg, PrivatAir GmbH , PrivatAir S.A., Contact Ai r, Eurowings, and Cirrus Airlines); November 20, 2009 (Dockets DOT-OST-2005-20122 and DOT-OST-2009-0277, Continental-Asiana); and January 26, 2010 (Dockets DOT-OST-2005-20122 and DOT-OST-2009-0340, Continental-Air New Zealand).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 with in seven (7) days after the date of

issuance of this Notice. This action was effective wh en 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 authori zed, the U.S. carrier applicant(s) shall:

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

(2) Comply with applicable requirements c oncerning oversales contained in 14 CFR 250 (for scheduled operations, if authorized);

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

(4) Comply with requirements for minimum insura nce coverage, and for certifying that coverage to the Department, contained in 14 CFR 205;

(5) Except as specifically exempted or otherwise pr ovided for in a Department Order, comply with the requirements of 14 CFR 203, concerni ng waiver of Warsaw Convention liability limits and defenses;

(6) Comply with all applicable requirement s of the Federal Aviati on Administration, the Transportation Security Administ ration, and with all ap plicable 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 concer ning security, the holder shall, before commencing any new service (including charter fli ghts) to or from a foreign airpor t, contact its Principal Security Inspector (PSI) to advise the PSI of its plans a nd 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 applicab le orders and regulations of other U.S. agencies and courts, a nd with all applicable laws of the United States.

The authority granted shall be eff ective only during the period when the holder is in compliance with the conditions imposed above.

1/2008

### Appendix B The code-share operations authorized here a re subject to the following conditions:

(a) The statements of authorization will remain in eff ect only as long as (i) Continental, Continental Micronesia, Colgan, and SAS continue to hold the necessary underlying aut hority to operate the code-share services at issue, and (ii) the code-share agreement providing for the code-share operations remains in effect.

(b) Continental, Continental Micronesia, Colgan and/or SA S, as appropriate, must notify the Department no later than 30 days before they begin any new code-s hare service under the code-share servic es authorized here. Such notice shall identify the market(s) to be served, which carrier will be opera ting the aircraft in the code-share market added, and the date on which the service will begin. 1 Such notice should be filed in Docket DOT-OST-2005-20122.

(c) Continental, Continental Micronesia, and/or SAS, as appr opriate, must promptly notify the Department if the codeshare agreement providing for the code-s hare operations is no longer effective or if the carriers decide to cease operating all or a portion of the approve d code-share services. Such notice s hould be filed in Docket DOT-OST-2005-

20122. 2

(d) The code-sharing operations conduc ted under this authority must comply with 14 CFR 257 and with any amendments to the Department’s regulations concer ning code-share arrangement s that may be adopted. Notwithstanding any provisions in the contract between th e 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-sha re 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 Fede ral Aviation Administration has issued a flight prohibition.

(e) The authority to operate to third countries is subject to the condition that any service provided under the statement 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 this blanket statement of authorization should be construed as conferring upon Continental, Continental Micronesia, or Colgan rights (including code-share, fifth freedom intermediate and/or beyond rights) to serve markets where U.S. carrier entry is limited unless Continental, Continental Micronesia, or Colgan notifies the Department of their intent to serve such a market and unless and until the Department has completed any necessary carrier selecti on 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, Continenta l Micronesia, or Colgan by virtue of the blanket statement of authorization granted here, but that are not then being u sed by Continental, Continenta l Micronesia, or Colgan, the holding of such authority will not be considered as providing any preference for Continen tal, Continental Micronesia, or Colgan in a competitive carrier selection proceeding to determine which carrier(s) should be entitled to use the authority at issue. 3

(f) The authority granted here is specifically conditioned so that neither Continental, Continental Micronesia, Colgan nor SAS shall give any force or effect to any contractua l provisions between themselves that are contrary to these

conditions.

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

1 Pursuant to the Department’s Notice In the Matter of Blanket Notification of Code-Share Service to Open Skies Partners and Points dated February 9, 2009, the joint applicants have provided blanket notification of their intent to engage in reciprocal code-share services, beginning on or about March 1, 2010, between Open Skies points as outlined in their application. The joi nt applicants also provided notice that, on or about March 1, 2010 , the (SK*) code of SAS will be displayed on Continental flights in the Newark-Mexico City market.

2 We expect this notification to be received within ten (10) days after su ch non-effectiveness or of such decision.

3 The notice in paragraph (b) above can be used for this notification.