5780 Federal Register / Vol. 71, No. 23 / Friday, February 3, 2006 / Rules and Regulations 

Department of the Treasury 

Office of the Comptroller of the 

Currency 

12 CFR Chapter I 

Authority and Issuance 

■ For the reasons set out in the joint 

preamble, the OCC corrects part 30 of 

chapter I of title 12 of the Code of 

Federal Regulations by making the 

following correcting amendments: 

PART 30—SAFETY AND SOUNDNESS 

STANDARDS 

■ 1. The authority citation for part 30 

continues to read as follows: 

Authority: 12 U.S.C. 93a, 371, 1818, 1831p, 

3102(b); 15 U.S.C. 1681s, 1681w, 6801, 

6805(b)(1). 

Appendix B to Part 30—[Amended] 

■ 2. In Supplement A to Appendix B, 

amend footnote 6 by removing ‘‘12 CFR 

part 314’’ and adding in its place ‘‘16 

CFR part 314’’. 

Federal Reserve System 

12 CFR Chapter II 

Authority and Issuance 

■ For the reasons set out in the joint 

preamble, the Board corrects parts 208 

and 225 of chapter II of title 12 of the 

Code of Federal Regulations by making 

the following correcting amendments: 

PART 208—MEMBERSHIP OF STATE 

BANKING INSTITUTIONS IN THE 

FEDERAL RESERVE SYSTEM 

(REGULATION H) 

■ 3. The authority citation for part 208 

continues to read as follows: 

Authority: 12 U.S.C. 24, 36, 92a, 93a, 

248(a), 248(c), 321–338a, 371d, 461, 481–486, 

601, 611, 1814, 1816, 1820(d)(9), 1823(j), 

1828(o), 1831, 1831o, 1831p–1, 1831r–1, 

1831w, 1831x, 1835a, 1882, 2901–2907, 

3105, 3310, 3331–3351, and 3906–3909, 15 

U.S.C. 78b, 781(b), 781(g), 781(i), 78o–4(c)(5), 

78q, 78q–1, 78w, 1681s, 1681w, 6801 and 

6805; 31 U.S.C. 5318, 42 U.S.C. 4012a, 4104a, 

4104b, 4106, and 4128. 

Appendix D–2 to Part 208—[Amended] 

■ 4. In Supplement A to Appendix D–

2, amend footnote 6 by removing ‘‘12 

CFR part 314’’ and adding in its place 

‘‘16 CFR part 314’’. 

PART 225—BANK HOLDING 

COMPANIES AND CHANGE IN BANK 

CONTROL (REGULATION Y) 

■ 5. The authority citation for 12 CFR 

part 225 continues to read as follows: 

Authority: 12 U.S.C. 1817(j)(13), 1818, 

1828(o), 1831i, 1831p–1, 1843(c)(8), 1844(b), 

1972(1), 3106, 3108, 3310, 3331–3351, 3906, 

3907, and 3909; 15 U.S.C. 1681s, 1681w, 

6801 and 6805. 

Appendix F to Part 225—[Amended] 

■ 6. In Supplement A to Appendix F, 

amend footnote 6 by removing ‘‘12 CFR 

part 314’’ and adding in its place ‘‘16 

CFR part 314’’. 

Federal Deposit Insurance Corporation 

12 CFR Chapter III 

Authority and Issuance 

■ For reasons set out in the joint 

preamble, the FDIC corrects part 364 of 

chapter III of title 12 of the Code of 

Federal Regulations by making the 

following correcting amendments: 

PART 364—STANDARDS FOR SAFETY 

AND SOUNDNESS 

■ 7. The authority citation for part 364 

continues to read as follows: 

Authority: 12 U.S.C. 1819 and 1819 

(Tenth); 15 U.S.C. 1681b, 1681s, and 1681w. 

Appendix B to Part 364—[Amended] 

■ 8. In Supplement A to Appendix B, 

amend footnote 6 by removing ‘‘12 CFR 

part 314’’ and adding in its place ‘‘16 

CFR part 316’’. 

Department of the Treasury 

Office of Thrift Supervision 

12 CFR Chapter V 

Authority and Issuance 

■ For reasons set out in the joint 

preamble the OTS corrects part 570 of 

chapter V of title 12 of the Code of 

Federal Regulations by making the 

following correcting amendment to read 

as follows’’

PART 570—SAFETY AND SOUNDNESS 

GUIDELINES AND COMPLIANCE 

PROCEDURES 

■ 9. The authority citation for part 570 

continues to read as follows: 

Authority: 12 U.S.C. 1462a, 1463, 1464, 

1467a, 1828, 1831p–1, 1881–1884; 15 U.S.C. 

1681s and 1681w; 15 U.S.C. 6801 and 

6805(b)(1). 

Appendix B to Part 570—[Amended] 

■ 10. In Supplement A to Appendix B, 

amend footnote 6 by removing ‘‘12 CFR 

part 314’’ and adding in its place ‘‘16 

CFR part 314’’. 

Dated: January 24, 2006. 

Julie L. Williams, 

First Senior Deputy Comptroller and Chief 

Counsel. 

By order of the Board of Governors of the 

Federal Reserve System, January 17, 2006. 

Jennifer J. Johnson, 

Secretary of the Board. 

Dated at Washington, DC, this 31st day 

January, 2006. 

Robert E. Feldman, 

Executive Secretary. 

Dated: January 30, 2006. 

Deborah Dakin, 

Senior Deputy Chief Counsel. 

[FR Doc. 06–1009 Filed 2–2–06; 8:45 am] 

BILLING CODE 4810–33–P; 6210–01–P; 6714–10–P; 

6720–01–P 

DEPARTMENT OF TRANSPORTATION 

Office of the Secretary 

14 CFR Part 212 

[Docket No. OST–2002–11741] 

RIN 2105–AD38 

Charter Rules for Foreign Direct Air 

Carriers 

AGENCY: Office of the Secretary, DOT. 

ACTION: Final rule. 

SUMMARY: The Department is amending 

its charter regulations by adding 

definitions of sixth- and seventhfreedom charters to the definitions 

section of 14 CFR Part 212, and by 

requiring foreign air carrier applicants 

for charter authority to provide updated 

reciprocity statements and operational 

data relative to its homeland-U.S. 

services. 

DATES: The rule shall become effective 

April 4, 2006. 

FOR FURTHER INFORMATION CONTACT: 

Brian Hedberg, Office of International 

Aviation (X–40), U.S. Department of 

Transportation, 400 7th Street, SW., 

Washington, DC 20590; (202) 366–7783. 

SUPPLEMENTARY INFORMATION: 

Background 

On January 21, 2005, the Department 

of Transportation issued a Notice of 

Proposed Rulemaking (NPRM) [70 FR 

3158, January 21, 2005] which proposed 

to (1) Clarify the definition of ‘‘fifth 

freedom charter’’ by adding definitions 

of ‘‘sixth- and seventh-freedom 

charters’’ in § 212.2; (2) modify OST 

Form 4540 (Foreign Air Carrier 

Application for Statement of 

Authorization) by requiring updated 

reciprocity statements by foreign air 

carriers seeking a statement of 


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1NACA comments of March 22, 2005, at 1. 

authorization under Part 212; and (3) 

require foreign air carrier applicants for 

a statement of authorization under Part 

212 to include historical data relative to 

the applicant’s U.S.-home country 

operations. 

The proposed definitional 

amendments to Part 212 would clarify 

that sixth-freedom charter means a 

charter flight carrying traffic that 

originates and terminates in a country 

other than the country of the foreign air 

carrier’s home country, provided the 

flight operates via the home country of 

the foreign air carrier; and that seventhfreedom charter means a charter flight 

carrying traffic that originates and 

terminates in a country other than the 

foreign air carrier’s home country, 

where the flight does not have a prior, 

intermediate, or subsequent stop in the 

foreign air carrier’s home country. 

The proposed revision of OST Form 

4540 would require that at the time of 

application for fifth-freedom charter 

authorization, the applicant foreign air 

carrier must present certification from 

its homeland government (or cite 

certification previously submitted to the 

Department that is dated within the 

previous 90-day period), that indicates 

that the carrier’s homeland grants to 

U.S. carriers a privilege similar to that 

requested by the applicant. The revision 

would also require applicant carriers to 

indicate on the application the number 

of third- and fourth-freedom flights the 

carrier has operated in the previous 

twelve-month period. 

Our issuance of the NPRM was taken 

in response to a petition for rulemaking 

filed by the National Air Carrier 

Association (NACA) on behalf of its 

member carriers. In the NPRM, after 

considering comments filed by 

interested parties in response to NACA’s 

petition, the Department proposed to 

make some, but not all, of the changes 

sought by NACA. In its comments 

concerning the NPRM, NACA stated 

that ‘‘We are grateful to the Department 

for the grant of NACA’s petition. While 

the Department clarifies that it is not 

granting all of the changes requested in 

NACA’s petition, the changes satisfy 

several of the more important concerns 

that NACA expressed in its petition.’’ 1

We address each of our proposed 

regulatory changes, in turn, below. 

Proposed Modification to the 

Definitions in 14 CFR 212.2 

Summary of Comments 

Most of the commenters supported, 

did not object to, or were silent on our 

proposed definitional changes. Only 

two comments to the NPRM explicitly 

opposed the changes. The supporters 

said that the new definitions would 

serve to better delineate between 

different types of services, fifth-, sixthand seventh-freedom, in both the 

scheduled and charter areas. NACA and 

AFL–CIO Transportation Trades 

Department (AFL–CIO TTD), although 

supporting the proposed new 

definitions for sixth- and seventhfreedom charters, would have us go 

further by having us define fifthfreedom charter so that it no longer 

encompasses flights that do not have 

any stops in the foreign air carrier’s 

homeland. The opponents, First Choice 

Airways and GWV Travel (GWV), assert 

that the new definitions go beyond the 

officially recognized ICAO ‘‘freedoms of 

the air,’’ are not required, and could 

cause confusion, including in the case 

of bilateral agreements that rely on the 

existing meaning of fifth-freedom. 

DOT Decision on 14 CFR 212.2 

We will finalize the changes to 14 

CFR 212.2, as proposed. We find that 

the new definitions are an accurate 

reflection of the meaning of the terms 

presented, and should serve to better 

delineate the different forms of service 

involved without causing confusion. We 

further find that this action is consistent 

with Section 820 of the Vision 100—

Century of Aviation Reauthorization 

Act, which conveyed the sense of 

Congress that the Department should 

formally define fifth-, sixth-, and 

seventh-freedom consistently for both 

scheduled and charter passenger traffic. 

We do not find that the commenters 

have presented persuasive arguments 

that our new definitions will generate 

confusion. In this regard, we find the 

general lack of opposition on the part of 

most commenters—many of whom will 

be using or be affected by the new 

definitions—to be significant. We will 

not, however, further amend this section 

to make changes to the definition of 

fifth-freedom charters as NACA and 

AFL–CIO TTD have suggested. While 

both commenters noted a degree of 

overlap in the definitions, we saw 

nothing in the comments received from 

other interested parties to indicate that 

they anticipated problems in applying 

or complying with the new definitions 

as proposed. In our NPRM we stated 

that we were proposing to amend our 

charter definitions because ‘‘even a 

limited degree of confusion is best 

avoided.’’ 70 FR 3158, 3163. We 

believed that specifically delineating the 

meaning of sixth- and seventh-freedom 

charters while not altering the longestablished and widely-recognized 

definition of fifth-freedom charters was 

the best means to minimize confusion. 

Taking into account all the comments 

filed in response to our NPRM, we are 

persuaded to finalize our definitions as 

proposed. We are confident that the 

definitional changes that we are making 

should be adequate to address our 

public interest objectives in this 

rulemaking proceeding. 

Proposed Modifications to OST Form 

4540 

Evidence of Reciprocity 

Summary of Comments 

NACA, Airports Council 

International—North America (ACI–

NA), AFL–CIO TTD, one U.S. indirect 

carrier (Apple Companies), and one U.S. 

direct air carrier (Amerijet) filed 

comments generally supporting our 

proposed change on evidence of 

reciprocity. They believe that the 

Department’s existing practice requires 

a finding of reciprocity and that the 

proposed revision only serves to 

formalize that existing practice. AFL–

CIO TTD states that the requirement 

will provide a key decisional element to 

the record at the time of application. 

ACI–NA specifies that it does not 

object to the Department’s requirement 

of a reciprocity statement so long as it 

is not burdensome to carriers. First 

Choice Airways, for its part, states that 

while it is not opposed to an initial 

reciprocity certification, once a 

determination of reciprocity is made it 

should remain valid until challenged. 

While NACA supports our proposed 

change, it nevertheless suggests that our 

proposed 90-day recertification 

requirement be extended to require 

recertification every six months. 

Air Transportation Association of 

America (ATA), one U.S. carrier (Atlas), 

three U.S. indirect carriers (GWV, 

Vacation Express, and TNT Vacations), 

and seven foreign direct carriers 

(Antonov Design Bureau (Antonov), Air 

Atlanta Icelandic, Condor Flugdienst 

(Condor), Grupo TACA, Skyservice 

Airlines, and Thomas Cook UK) filed 

comments in opposition. ATA suggests 

that no reciprocity statement be 

required unless a U.S. carrier lodges a 

challenge. 

ATA, Atlas, and some foreign direct 

air carriers expressed their preference 

for maintaining the current system in 

which reciprocity is determined by the 

Department and aided by U.S. carrier 

objections on the record (when they feel 

that reciprocity is lacking) because they 

are aware of no problems that have 

arisen in relation to fifth-freedom 

charter operations. Some U.S. indirect 

carriers comment that instituting an 

official reciprocity requirement might 


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5782 Federal Register / Vol. 71, No. 23 / Friday, February 3, 2006 / Rules and Regulations 

lead foreign governments to impose like 

requirements on U.S. carriers, thus 

redounding to the detriment of 

liberalized U.S. aviation policies. Some 

U.S. indirect carriers and foreign direct 

carriers state that a reciprocity 

certification requirement could become 

burdensome and in some cases even be 

unobtainable, especially given the shortnotice nature of many fifth-freedom 

charter applications, thus chilling 

business, preventing market entry, and 

limiting competitive choices. 

Many foreign direct carriers believe 

that the reciprocity verification 

requirement does not serve any useful 

purpose and is inconsistent with the 

Department’s open-skies policy. Grupo 

TACA asserts that obtaining such 

certification is unnecessary given the 

small numbers of charters conducted by 

foreign carriers relative to the volume of 

charters provided by U.S. carriers in 

foreign markets. Yet others suggest that 

it will be difficult to obtain such a 

statement from foreign officials, 

especially in markets where the U.S. 

presence is minimal. Another feels that 

the Department has provided 

insufficient guidance as to what type of 

certification is necessary. One foreign 

direct carrier suggested that it be 

permitted to cite the certification 

provided by a foreign government to 

another carrier for these purposes. 

DOT Decision on Evidence of 

Reciprocity 

We will finalize our requirement that 

applicants provide certification of 

reciprocity. Our NPRM states 

unequivocally that ‘‘reciprocity on the 

part of the applicant’s home country is 

the primary criterion for approval of the 

type of charter requests involved here.’’

70 FR 3158, 3162. In this, the NPRM 

was simply repeating longstanding 

Department policy and practice. Clearly, 

in evaluating the primary criterion for 

reaching a decision, the public interest 

calls for our having access to 

meaningful, reliable evidence. 

Given the short-notice nature of many 

of the requests for these types of 

services, we have found that we simply 

could not be assured that potentially 

interested parties, or we ourselves, 

might have the wherewithal in the 

limited time available to verify that an 

applicant’s assertion of reciprocity was 

justified in the specific circumstances 

presented. While input from aggrieved 

U.S. carriers or our own knowledge of 

a particular bilateral relationship can, of 

course, be informative—indeed in some 

instances fully dispositive, cases may 

well arise where the best available 

source of information on reciprocity 

will be the applicant itself. 

While we have every confidence that 

the applicants provide information on 

Form 4540 to the best of their ability 

and knowledge and in good faith, the 

fact remains that the presence or lack of 

reciprocity is a matter resting within the 

control not of the applicant itself, but of 

its government. The applicant is at best 

a ‘‘second-hand’’ provider of such 

information. Our proposed rule 

provides a means for ensuring that the 

first-hand source for information on this 

essential element of our decisional 

process exist in the record to speak for 

itself. 

We are confident that in situations 

where reciprocity truly is not an issue, 

concerned governments will be able to 

work with their carriers to ensure that 

a streamlined process exists for getting 

the necessary statements to us in a way 

that should cause little if any additional 

burden or delay. Indeed, the nature of 

the exercise, by introducing into the 

record more probative evidence on this 

central issue, could serve to expedite 

the decisional process. 

Saying this, we have reflected on 

whether we need to see the reciprocity 

affirmations ‘‘refreshed’’ every 90 days. 

We believe that the commenters 

provided adequate evidence to persuade 

us to extend the length of validity of a 

reciprocity certification from 90 days to 

six months. We have concluded that 

changing to a six-month period should 

still provide sufficiently current 

information for the purposes presented, 

while addressing the concerns of some 

of the commenters who asserted that our 

90-day requirement was exceedingly 

burdensome. Of course, as we stated in 

the NPRM, if intervening events give 

reason to doubt the continuing validity 

of a particular verification, we will 

expect applicants to seek a new 

verification, even if their subsequent 

request is submitted within six months 

of a previous verification. 

Reporting of Third- and Fourth-Freedom 

Statistics 

Summary of Comments 

NACA, ACI–NA, one U.S. direct 

carrier (Amerijet), and one U.S. indirect 

carrier (Apple Companies) submitted 

comments generally supporting our 

proposed change. These commenters 

acknowledge that carriers currently 

provide information to the Department 

regarding third- and fourth-freedom 

operations in the form of T–100 data, 

but note that the data are not readily 

accessible due to the delay in T–100 

data availability. NACA asserts that 

access to timely data can help carriers 

and the Department in evaluating 

applications for fifth-, sixth-, and 

seventh-freedom charter operations and 

can speed the approval process. 

ACI–NA specifies that it has no 

problem with the proposed reporting 

requirement so long as it does not prove 

burdensome to carriers. Antonov states 

that it ‘‘does not object in principle to 

providing this information.’’ It is 

concerned, however, that considering 

the unique nature of outsized cargo 

services, information regarding thirdand fourth-freedom charter flight 

information may provide an inadequate 

record for the Department to make a 

public interest determination regarding 

a carrier’s ‘‘undue reliance’’ on fifth-, 

sixth-, or seventh-freedom operations. 

ATA, three U.S. indirect carriers 

(GWV, Vacation Express, and TNT 

Vacations), and three foreign direct 

carriers (Air Atlanta Icelandic, Grupo 

TACA and Skyservice Airlines) 

submitted comments in opposition. 

They believe that the data we are 

requesting are already collected by the 

Department in the form of T–100 data, 

and thus our amendment to Form 4540 

is unnecessary and redundant. They 

comment that the reporting requirement 

imposes expense and delay on carriers 

without providing any added benefit. 

Vacation Express and TNT Vacations 

also suggest that the reporting 

requirement could have a chilling effect, 

discouraging carriers from applying and 

then likely limiting the services 

available to the public. Grupo TACA 

asserts that the additional reporting 

required by this revision to Form 4540 

is unnecessary, considering the relative 

dominance of U.S. charters operating in 

the U.S.-Central American market, and 

given that nearly all its members are 

domiciled in open-skies countries. 

DOT Decision on Reporting of Thirdand Fourth-Freedom Operations 

In our NPRM, we specifically said 

that, in addition to reciprocity, the 

Department ‘‘also examines other factors 

that may be relevant in specific cases 

(for example, the extent of the 

applicant’s reliance on fifth-freedom 

operations in relation to its third- and 

fourth-freedom services).’’ 70 FR 3158, 

3162. In this regard, we proposed to 

amend OST Form 4540 so that 

applicants would specify the number of 

third- and fourth-freedom flights they 

have provided over the preceding 

calendar year. We expressly called upon 

applicants to present the information 

with sufficient clarity ‘‘for any 

commenting parties and the Department 

to readily evaluate the proposed 

services against the historical data.’’ Id., 

at 3163. 

As our NPRM indicated, the issue of 

excessive reliance on fifth-, sixth- and 


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2Antonov comments of March 22, 2005, at 5. 3Amerijet comments of March 22, 2005, at 5. 

seventh-freedom operations vis-a`-vis 

third- and fourth-freedom operations 

remains an element of our public 

interest analysis for applications of this 

type. As such, interested parties are 

entitled to have information that would 

enable them to offer meaningful 

comments on the record in this issue, 

and we ourselves would want to have 

data that permit us to give this issue 

appropriate consideration in our 

decisional process. 

We find that the reporting 

requirement we proposed should 

achieve those objectives. While we 

recognize, as some of the commenters 

point out, that T–100 data might cover 

some of the same terrain, they are no 

substitute. The T–100 program was 

never designed to provide a readily 

accessible data base for undue reliance 

evaluations in the context of the often 

short-notice, quick turnaround filings 

that characterize our charter approval 

process. It is entirely reasonable to 

expect that the data we are requesting 

should be in the applicant’s possession 

and that the applicant should be in a 

position readily to provide it. Given the 

role that such data might play in our 

public interest determination, and the 

absence of equivalent alternatives in the 

circumstances presented, on balance, 

we conclude that whatever burden may 

be entailed by this new requirement is 

clearly outweighed by the public 

benefits produced. We are not 

persuaded that this result will engender 

any form of chilling effect. The data at 

issue are data that carriers are already 

required to collect and transmit to us. 

Furthermore, our standards (including 

our standards as to undue reliance) are 

not changing; nor is the way in which 

we intend to apply these standards. Our 

amendment is essentially an 

administrative measure designed to 

promote an enhanced record and more 

efficient decision-making. 

Other Issues 

In addition to commenting on the 

specific aspects of our proposed rule, 

several commenters also offered other 

comments, either questioning aspects of 

our overall approach or requesting that 

we go even further in our proposed 

remedies. 

For example, Antonov objected to the 

Form 4540 changes applying to cargo 

charters as well as passenger charters. 

Antonov asserts that there are 

significant commercial and aeropolitical 

differences between cargo and passenger 

flights and that ‘‘it would harm U.S. and 

foreign carrier interests alike if the 

freely functioning global cargo charter 

market were suddenly subject to more 

burdensome and more restrictive new 

administrative flight requirements by 

the United States.* * * 2

We have decided not to create a 

different Form 4540 regime for cargo 

charters. As we said above, the materials 

we are seeking are either within the 

possession of the applicant foreign 

carrier or are materials that they should 

be able to arrange readily for the 

homeland governments to provide. 

Therefore, we are unpersuaded that our 

changes will create an unworkable or 

unfair burden. We emphasize that we 

are not changing our applicable 

decisional standards or the nature of the 

findings we would need to make to 

support those decisions. Our changes go 

entirely to ensuring that those findings 

rest on a firmer evidentiary foundation. 

We regard this as entirely consistent 

with the public interest. 

NACA and Atlas would have us 

modify the rule to require significantly 

more detailed evidence from the foreign 

carrier applicant describing the cargo to 

be carried, bulk versus outsized. They 

are concerned that we are approving 

flights because of their asserted outsized 

cargo, when in fact the outsized cargo 

may actually represent only a portion of 

the actual cargo carried. Furthermore, 

Atlas states that given the typical shortnotice nature of many fifth-freedom 

cargo charter requests, interested parties 

cannot file meaningful, timely responses 

unless that application includes more 

detailed information about the cargo to 

be carried. 

Antonov opposes this proposed 

change. It states that such a change 

would mean that applications could 

only be filed at the very last minute 

when packing lists were finalized and 

that even then numerous changes could 

still occur because shippers and 

charterers generally operate on the 

understanding that they are contracting 

for the entire aircraft and use this 

flexibility to make packing list changes 

right up to the time of departure. 

Antonov states that a cargo-specific 

approval requirement accordingly 

would be burdensome: Cumbersome for 

applicants, U.S. cargo carriers (who 

would need to be polled regarding the 

changes), and the Department. Antonov 

also comments that it would greatly 

impede the flow of commerce and cause 

costly delays to time-sensitive 

shipments. 

We will not adopt the modification 

proposed by NACA and Atlas. Unlike 

our other proposed changes, which we 

see as involving materials readily 

available or obtainable in ways that we 

are not persuaded would interfere with 

our existing regulatory approach, we are 

unconvinced that the proposed NACA 

and Atlas change could be achieved 

without introducing the type of 

regulatory burden and delay we would 

wish to avoid. 

We reach a similar result with regard 

to the comments of Amerijet. Amerijet 

raises a procedural due process issue 

over the awarding of seventh-freedom 

cargo rights through bilateral 

negotiations and also raises policy 

questions relating to our approach on 

awarding fifth-, sixth-, and seventhfreedom charters. We regard these issues 

as well beyond the scope of the 

specifically focused regulatory 

procedural measures we announced in 

our NPRM—which Amerijet expressly 

‘‘welcomes and supports.’’ 3

Consequently, we will not pursue them 

here. 

An additional comment beyond the 

scope of our contemplated changes is 

the ACI–NA recommendation that we 

consider amending our rules to cite the 

value of a proposed international 

charter to U.S. airports and their local 

economies as one of the public interest 

factors to be considered when we 

receive foreign carrier charter 

applications. We note this as essentially 

a suggestion offered for our future 

consideration. 

Finally, we note that commenters, 

such as TACA, wondered whether some 

of our proposed changes should even 

apply to them given prevailing openskies regimes, and perhaps, also, 

bilateral seventh-freedom charter rights. 

We are certainly not seeking by this rule 

to impose filing requirements when 

none would be necessary from a public 

interest standpoint. Parties who believe 

there are clearly delineated bilateral 

rights, and that, therefore, they should 

not need to seek prior approval at all for 

certain charter operations are free to 

make appropriate requests for waivers 

or for adjustments to their underlying 

operating authority. 

Regulatory Analyses and Notices 

Executive Order 12866 (Regulatory 

Planning and Review) and DOT 

Regulatory Policies and Procedures 

Executive Order 12866, Regulatory 

Planning and Review, directs the 

Department to assess both the costs and 

the benefits of a regulatory change. We 

are not allowed to propose or adopt a 

regulation unless we make a reasoned 

determination that the benefits of the 

intended regulation justify the costs. 

This rule is a significant regulation 

under Executive Order 12866 and DOT’s 

Regulatory Policies and procedures 


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because of public interest. The NPRM 

was reviewed by the Office of 

Management and Budget under 

Executive Order 12866. Our assessment 

of this rulemaking indicates that its 

economic impact is minimal because 

the rule will impose only minimal 

incremental new costs on applicant 

carriers, and codifies, in part, existing 

practice. The rule clarifies, by 

definition, the types of charters being 

conducted; requires that applicant 

foreign carriers cite certification from 

the carrier’s homeland government 

stating that it affords reciprocity to U.S. 

fifth-freedom charters; and, requires that 

foreign air carriers accurately represent 

the number of third- and fourth-freedom 

flights conducted in the previous 

twelve-month period. 

The definitional changes will not 

affect the manner in which foreign air 

carriers conduct business; nor will it 

affect our decision-making process. 

Reciprocity is a public interest criterion 

already considered in evaluating fifth-, 

sixth- and seventh-freedom charter 

applications. The required certification 

will be required only once every six 

months. The data regarding third- and 

fourth-freedom flights we now require 

should be in the applicant’s possession 

and the applicant should be in a 

position readily to provide it at the time 

of application. 

Executive Order 13132 (Federalism 

Assessment) 

The Department has analyzed this 

rulemaking action in accordance with 

the principles and criteria set forth in 

Executive Order 13132 and has 

determined that it does not have 

sufficient federalism implications to 

warrant consultation with State and 

local officials. The Department 

anticipates that any action taken will 

not preempt a State law or State 

regulation or affect the States’ ability to 

discharge traditional State government 

functions. 

Regulatory Flexibility Act 

The Regulatory Flexibility Act (5 

U.S.C. 601, et seq.) requires an agency 

to review regulations to assess their 

impact on small entities unless the 

agency determines that a rule is not 

expected to have a significant impact on 

a substantial number of small entities. 

Because this rule does not subject U.S. 

carriers to new procedures or reporting 

requirements, the Department certifies 

that this rule will not have a significant 

economic impact on a substantial 

number of U.S. small businesses. 

The Department notes, however, that 

this rule imposes a minimal additional 

paperwork burden on foreign air 

carriers, that may or may not maintain 

offices in the U.S., because they must 

report data regarding the number of 

third- and fourth-freedom flights 

provided in the most recent twelvemonth period. Although the affected 

carriers must record this information for 

other reporting requirements on a 

monthly basis, the significant time delay 

in collecting, analyzing, and publicly 

issuing these data significantly reduces 

the value of the data for purposes of 

evaluating fifth-freedom charter 

applications. With minimal burden, the 

affected carriers can provide a record of 

the number of flights provided within 

the last twelve-month period by adding 

the numbers reported to the Department 

for each of the previous twelve months, 

and recording the sum on application 

OST Form 4540, thus providing all 

interested parties with current, detailed 

information vital to proper evaluation of 

applications. Furthermore, this 

reporting requirement will have no net 

effect on the way in which foreign air 

carriers conduct business or on the 

manner in which the Department 

evaluates the merits of fifth-freedom 

charter applications. 

Regulation Identifier (RIN) 

A regulation identifier (RIN) is 

assigned to each regulatory action listed 

in the Unified Agenda of Federal 

Regulations. The Regulatory Information 

Service Center publishes the Unified 

Agenda in April and October of each 

year. The RIN contained in the heading 

of this document can be used to crossreference this action with the Unified 

Agenda. 

Unfunded Mandates Reform Act 

The changes proposed would not 

impose any unfunded mandates for the 

purpose of the Unfunded Mandates 

Reform Act of 1995. 

Paperwork Reduction Act 

Under the Paperwork Reduction Act 

of 1995, 44 U.S.C. 3501–3520, Federal 

agencies must obtain approval from the 

Office of Management and Budget 

(OMB) for each collection of 

information they conduct, sponsor, or 

require through regulations. This rule 

contains information collection 

requirements. As required by the 

Paperwork Reduction Act, the 

Department will submit this 

requirement to the Office of Information 

and Regulatory Affairs of the OMB for 

review, and reinstatement, with change, 

of a previously approved collection. 

OST Form 4540 is a required 

Application for Statement of 

Authorization for foreign air carriers to 

file with the Department prior to 

engaging in certain charter operations to 

and from the United States. The 

Department grants or denies the 

authorization to the foreign air carrier. 

Foreign air carriers file this form as 

often as necessary whenever they wish 

to perform charter flights for which 

prior Department approval is required 

by Part 212. This form is required for all 

foreign air carriers seeking Department 

authority to conduct certain types of 

charter flights, and does not require a 

significant amount of time to complete, 

and is not burdensome to complete. 

OMB Number: 2106–0035. 

Title: 14 CFR Part 212—Charter Rules 

for U.S. and Foreign Direct Air Carriers. 

Burden hours: 1000. 

Affected public: Business or other forprofit. 

Cost: $400,000.00. 

Description of Paperwork: The 

proposed changes to the rulemaking and 

the form are intended to improve the 

Department’s ability to assess the merits 

of applications filed under Part 212, and 

will ensure that the Department has the 

most current information on the state of 

reciprocity for each foreign carrier 

applicant for charter authority filed 

under Part 212. These proposed changes 

will also enhance the Department’s 

decision-making process without 

imposing an undue burden on 

applicants or affecting the public 

benefits that the Department’s rules now 

provide. The collection of historical 

data relative to the applicant’s U.S.- 

home country operations will allow the 

Department to satisfy any concerns it 

might have as to the applicant’s reliance 

on fifth-, sixth- and seventh-freedom 

operations. 

List of Subjects in 14 CFR Part 212 

Air carriers, air transportation, charter 

flights, reporting and recordkeeping 

requirements. 

■ For the reasons set forth in the 

preamble, the Department amends Part 

212 as follows: 

PART 212—CHARTER RULES FOR 

U.S. AND FOREIGN DIRECT AIR 

CARRIERS 

■ 1. The authority citation for 14 CFR 

part 212 continues to read as follows: 

Authority: 49 U.S.C. 40101, 40102, 40109, 

40113, 41101, 41103, 41504, 41702, 41708, 

41712, 46101. 

■ 2. Amend § 212.2 by adding, in 

alphabetical order among the existing 

definitions, a definition of ‘‘Seventh 

freedom charter’’ and a definition of 

‘‘Sixth freedom charter.’’

§ 212.2 Definitions. 

* * * * * 


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Seventh-freedom charter means a 

charter flight carrying traffic that 

originates and terminates in a country 

other than the foreign air carrier’s home 

country, where the flight does not have 

a prior, intermediate, or subsequent stop 

in the foreign air carrier’s home country. 

* * * * * 

Sixth-freedom charter means a charter 

flight carrying traffic that originates and 

terminates in a country other than the 

country of the foreign air carrier’s home 

country, provided the flight operates via 

the home country of the foreign air 

carrier. 

* * * * * 

■ 3. In § 212.9, revise paragraph (b) (1) 

to read as follows: 

§ 212.9 Prior authorization requirements. 

* * * * * 

(b) * * * 

(1) Fifth-, sixth- and/or seventhfreedom charter flights to or from the 

United States; 

* * * * * 

Issued this 27th day of January, 2006 in 

Washington, DC. 

Michael W. Reynolds, 

Acting Assistant Secretary for Aviation and 

International Affairs. 

The following OST Form 4540 will 

not appear in the Code of Federal 

Regulations. 

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