Served: August 4, 2014

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

Application of

NORWEGIAN AIR INTERNATIONAL LIMITED

for an exemption under 49 U.S.C. § 40109 and 

a foreign air carrier permit pursuant to 49 U.S.C. § 41301

Docket DOT-OST-2013-0204

NOTICE

Pursuant to a request made by the U.S. Government (U.S.) to the European Commission’s Directorate 

General for Mobility and Transport (DG MOVE) to meet to ask for its views on the legal meaning and 

applicability of Article 17 bis of the Air Transport Agreement (the Agreement), representatives from the 

Departments of State and Transportation (DOT) met with European Commission (EC) officials in 

Brussels, Belgium, on July 14, 2014. The meeting was not held under the auspices of the Joint 

Committee but served as an opportunity for EC officials to respond to the U.S. request. The discussion 

was amicable. 

It was noted that the meeting had been requested by U.S. Secretary of Transportation Anthony Foxx. The 

Secretary also requested the presence of the Department’s Assistant Secretary for Aviation and 

International Affairs, General Counsel, and Deputy Assistant Secretary for Aviation and International 

Affairs. The Director of Aviation (the Director) for DG MOVE spoke on behalf of the EC delegation. It 

was also noted on both sides that the high-level participation in the U.S. delegation was an indication of 

the attention and interest that this issue generally, and the Norwegian Air International (NAI) case in 

particular, have in the United States.

At the beginning of the meeting, the U.S. delegation stated that, because the NAI application currently is 

pending before the DOT, it was not able to engage in a dialogue regarding Article 17 bis. The U.S. 

delegation did state, however, that obtaining DG MOVE’s views on the meaning and applicability of 

Article 17 bis could inform DOT’s consideration of the NAI application. In that connection, the U.S. 

sought to hear DG MOVE’s views on the meaning and applicability of Article 17 bis of the Agreement as 

it pertains to consideration of a foreign air carrier’s application for operating authority. In particular, the 

U.S. delegation inquired as to the EC’s views on the mechanisms available for discussing Article 17 bis; 

the role of the Joint Committee in discussing Article 17 bis; and the circumstances relevant to a unilateral 

or joint decision to grant or deny an application under Article 17 bis. 

Article 17 bis of the Agreement reads:

Article 17 bis: Social Dimension

1. The Parties recognise the importance of the social dimension of the Agreement and the benefits 

that arise when open markets are accompanied by high labour standards. The opportunities 
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created by the Agreement are not intended to undermine labour standards or the labour-related 

rights and principles contained in the Parties' respective laws. 

2. The principles in paragraph 1 shall guide the Parties as they implement the Agreement, 

including regular consideration by the Joint Committee, pursuant to Article 18, of the social 

effects of the Agreement and the development of appropriate responses to concerns found to be 

legitimate.

The Director noted that the views expressed during the meetings were the views of EC officials, and that 

DG MOVE was in the process of discussing the issues with representatives of European Union (EU) 

Member States, Iceland, and Norway, which are all parties to the Agreement. 

The Director provided more detail on the EC’s view that 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. 

The Director asserted that paragraph 1 of Article17 bis sets out the parties' views on the "importance of 

the social dimension" of the Agreement and the "intentions" underlying the opportunities it creates. It 

does not provide for legal consequences to be drawn from these views. According to the Director, its 

paragraph 2 refers to paragraph 1 as containing certain principles. These principles shall "guide" the 

parties as they implement the Agreement. Such implementation is referred to as a matter to be dealt with 

by "the parties," not any one single party. By the same logic, paragraph 2 refers to "regular consideration 

by the Joint Committee." DG MOVE asserted that such consideration is clearly directed at two aspects, 

namely the "social effects of the Agreement" and the "development of appropriate responses to concerns 

found to be legitimate." The context implies that a "finding" that concerns are "legitimate" can be made 

only through agreement between the parties and that "responses" cannot be developed unilaterally by one 

party against the interests of the other party [to the same effect, cf. also Article 18(4)(b)].

In response to U.S. questions, the Director noted that DG MOVE believes that if a party has a concern 

about Article 17 bis as a general matter the only mechanism available under the Agreement is to raise the 

issue for consideration by the Joint Committee established under Article 18(4). Article 18(4)(b) allows 

the Joint Committee to “consider the social effects of the Agreement as it is implemented and develop 

appropriate responses to concerns found to be legitimate.” He further noted that, if a party wanted to 

discuss Article 17 bis in the context of a particular foreign air carrier application, it could avail itself of 

Article 6 bis (1)(a), which also leads to consultations. Article 6 bis (1)(a) reads:

Article 6 bis: Reciprocal Recognition of Regulatory Determinations with Regard to Airline Fitness and 

Citizenship

1. Upon receipt of an application for operating authorisation, pursuant to Article 4, from an air 

carrier of one Party, the aeronautical authorities of the other Party shall recognise any fitness and/or 

citizenship determination made by the aeronautical authorities of the first Party with respect to that 

air carrier as if such a determination had been made by its own aeronautical authorities and not 

enquire further into such matters, except as provided for at sub-paragraph (a) below:

(a) If, after receipt of an application for operating authorisation from an air carrier, or after the 

grant of such authorisation, the aeronautical authorities of the receiving Party have a specific 

reason for concern that, despite the determination made by the aeronautical authorities of the 

other Party, the conditions prescribed in Article 4 of this Agreement for the grant of appropriate 

authorisations or permissions have not been met, then they shall promptly advise those 

authorities, giving substantive reasons for their concern. In that event, either Party may seek 

consultations, which should include representatives of the relevant aeronautical authorities, 
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and/or additional information relevant to this concern, and such requests shall be met as soon as 

practicable. If the matter remains unresolved, either Party may bring the matter to the Joint 

Committee;

The Director noted that DG MOVE believes that, under certain circumstances, 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 undermines labor-related rights and laws). However, he emphasized that the key 

message from DG MOVE’s perspective was that Article 17 bis of the Agreement cannot be referred to 

unilaterally by a Party to refuse an authorization under Article 4 of the Agreement to an airline of the 

other Party. 

Article 4 reads:

Article 4: Authorization

On receipt of applications from an airline of one Party, in the form and manner prescribed for 

operating authorizations and technical permissions, the other Party shall grant appropriate 

authorizations and permissions with minimum procedural delay, provided:

(a) for a U.S. airline, substantial ownership and effective control of that airline are vested in the 

United States, U.S. nationals, or both, and the airline is licensed as a U.S. airline and has its 

principal place of business in U.S. territory;

(b) for a Community airline, substantial ownership and effective control of that airline are vested 

in a Member State or States, nationals of such a state or states, or both, and the airline is licensed 

as a Community airline and has its principal place of business in the territory of the European 

Community;

(c) the airline is qualified to meet the conditions prescribed under the laws and regulations 

normally applied to the operation of international air transportation by the Party considering the 

application or applications; and

(d) the provisions set forth in Article 8 (Safety) and Article 9 (Security) are being maintained and 

administered.

In closing, the Director reiterated DG MOVE’s position that any unilateral decision to deny an application 

using Article 17 bis runs against the letter and spirit of the Agreement. 

Delegations

United States

Susan L. Kurland, Assistant Secretary for Aviation and International Affairs, DOT

Kathryn Thomson, General Counsel, DOT

Brandon Belford, Deputy Assistant Secretary for Aviation and International Affairs, DOT

Paul Gretch, Director, Office of International Aviation, DOT

Jennifer Thibodeau, Attorney Advisor, Office of the General Counsel, DOT

Stephen Cristina, Director, Office of Aviation Negotiations, State Department

Kristin Westphal, Office of Aviation Negotiations, State Department

Karin Kizer, Office of the Legal Adviser, State Department

Hylko Oosterloo, U.S. Mission to the European Union, State Department

European Commission

Matthew Baldwin, Director Aviation and International Transport Affairs, DG MOVE

Deniz Bayraktutar, International Transport Affairs, DG MOVE

Emmanuelle Maire, Head of Unit, Internal Market & Airports, DG MOVE
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Frédéric Lagneaux, Internal Market & Airports, DG MOVE

Eddy Liégeois, Legal matters & infringements, DG MOVE

Walter Moells, European Commission Legal Service

In light of Norwegian Air International Limited’s ongoing application in this Docket, we establish the 

following procedural schedule for public comments on the above summary:

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Answers – must be filed no later than August 18, 2014;

Replies – must be filed no later than August 25, 2014.

We will serve this Notice on all persons on the service list for this docket. 

By: 

PAUL L. GRETCH

Director, Office of International Aviation

Date: August 4, 2014

(SEAL) 

An electronic version of this document is available at http://www.regulations.gov 

 

1 Given the extensive comments that have already been submitted regarding this application, we ask interested parties to 

limit any further comments to responding to the information contained in the summary.