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Anita M. Mosner 202.419.2604 . anita .mosner@hklaw.com March 3, 2015 BY ELECTRONIC SUBMISSION U.S. Department of Transportation Docket Operations West Building Ground Floor Room W12-140 1200 New Jersey Avenue , S.E . Washington , DC 20590 Re : Renewal of Petition for Exemption ; Docket No. FAA-2010-0101 Pursuant to 49 U.S .C. 

### § 44701(f) and 14 C.F.R. Part 11, Air Canada hereby petitions the Federal Aviation Administration ("FAA") for renewal of the exemption granted in the above-captioned docket. This exemption provides relief from 14 C.F.R. 

### § 93 . 123 to the extent necessary to permit Air Canada to continue its flight operations at Washington Reagan National Airport ("DCA"), in order to preserve certain valuable , longstanding Air Canada flights between DCA and Canada . On May 10, 2010 , FAA granted Air Canada an exemption from 14 C.F.R. 

### § 93 . 123 to allow Air Canada to continue operating scheduled service to DCA using six daily commuter slots it had previously leased from Midway Airlines . 1 In its Grant of Exemption, FAA found that granting the exemption to Air Canada has no adverse effect on safety and is in the public interest. 2 That exemption is set to expire on June 18, 2015. All of the public interest justifications favoring the grant of this exemption continue to apply,3 and consistent with Administration precedent, the FAA should renew this exemption authority.4 Renewal of the existing exemption would enable Air Canada to 1 FAA Grant of Exemption, Exemption No . 10063, Docket No . FAA-201 0-0101 (May 10, 201 0) . 2 FAA Grant of Exemption at 3. 3 FAA's previous determination that granting the exemption would not adversely affect safety because continuation of existing service would have no operational impact on DCA also continues to apply. 4 See, e.g., Renewal of Exemption No. 7370, Docket No. FAA-2002-13734 (Jul. 9, 2012) (FAA granted six previous renewals) ; Renewal of Exemption No . 8112 , Docket No. FAA-2003-14563 (Aug . 28 , 2012) (FAA granted five previous renewals) . In granting these renewals , FAA found that the original justifications for granting the exemption remained valid and renewal was in the public interest.Air Canada Petition for Renewal of Exemption March 3, 2015 continue its long-standing DCA-Canada services , which is both consistent with the public interest and beneficial to the public as a whole . Because approval of this application would merely continue the status quo, approval of this renewal request will have no impact on airport operations . As the FAA is aware , Air Canada has served the DCA market since 1995, when Canada and the US reached their first-stage open skies agreement. Unlike other foreign air carriers , which traditionally have obtained slots as a matter of bilateral right, the USCanada open skies agreement expressly provided that Canadian carriers would be treated in the same manner as US carriers for the purpose of accessing DCA. 5 To gain such access , Air Canada made a considerable investment in a long-term lease of 15 commuter slots from Midway Airlines . Although Air Canada eventually purchased seven of these slots , it was forced to seek the existing exemption due to an unprecedented situation in which Midway renounced title and interest in six of the slots , making it impossible for Air Canada to purchase the slots or extend its lease.6 Before filing for an exemption , Air Canada made exhaustive efforts to secure replacement slots through either purchase or lease . Its efforts to purchase or lease replacement slots were unsuccessful , necessitating administrative relief to prevent the severe disruption or cessation of several of its long-standing DCA services . Although Air Canada has long desired to expand its presence at DCA beyond the scope of its current operation , it has been unable to do so. Since the grant of the exemption, Air Canada pursued a range of commercial options , including the possibility of bidding on the DCA slots divested pursuant to the US Airways-American Airlines merger. Air Canada was told by DOJ that it could not bid for those assets , on the grounds that those slot assets were being divested specifically to remedy harm in the US domestic market. Air Canada also has monitored the availability of exemption slots and has attempted to apply for such slots when it has been el igible to do so. Unfortunately, Air Canada has been viewed as ineligible to participate in the process of applying for with in perimeter slots, and was unsuccessful in the one effort to secure outsideperimeter exemption slots that it was permitted to make. 7 Failure to renew th is exemption would be strongly contrary to the public interest. Loss of these six slots would force Air Canada to terminate service and/or reduce frequency between DCA and one or more of the Canadian cities it serves with these slots (Montreal, Ottawa and Toronto) . This would remove an important competitive option not only for nonstop travelers , but also for passengers who travel on connecting flights beyond these Canadian cities . Preserving the travel options of passengers utilizing these services is will preserve Air Canada's longstanding presence in the DCA market, prevent service disruptions , and offer important competitive benefits· . 5 1995 US-Canada Open Skies Agreement, Annex II , Section 2 . 6 Midway took this step so that it could become eligible to apply for and hold certain jet slot exemptions at DCA created under the Wendell H. Ford Aviation Investment and Reform Act for the 21st Century (Public Law 106-18 1) as a "limited incumbent. " 7 Indeed , Air Canada historically has been denied access to many newly-created slots due to statutory criteria for access . When the FAA Modernization and Reform Act of 2012 allowed for Air Canada to compete for beyond-perimeter slots , Air Canada vigorously pursued the opportunity. Ultimately, though , its bid to obtain two slots for service to Vancouver was denied .

- 2-Air Canada Petition for Renewal of Exemption March 3, 2015 For the reasons set forth in this petition , Air Canada respectfully requests that the FAA renew Air Canada's existing exemption for a period of at least five years. lly submitted,

Anita M. Mesner Jennifer M . Nowak Attorneys for Air Canada cc: Reggie Govan, FAA Lorelei Peter, FAA Brian Meehan , FAA

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