UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation on June 26 , 2012



### NOTICE OF ACTION TAKEN

-- DOCKET DOT

- OST

- 2012

- 0089

________________________________________________________________________________________________ ________ This serves as notice to the public of the action described below, taken by the Department official indicated (no additional confirming order will be i ssued in this matter).

Applicant : TAM

- LINHAS AEREAS S.A. (TAM) Date Filed: June 7, 2012

Relief requested: S tatement of authorization under 14 CFR Part 212 to permit TAM to engage in all

- cargo block space/code

- share services by displaying the (M3*) de signator code of Aerolinhas Brasileiras S.A. (ABSA) on flights operated by TAM between Brazil and the United States for the carriage of freight only

. 1

TAM requests that the statement of authorization be granted for an indefinite period and further reque sts waiver of the

45

- day advance filing requirement under 14 CFR Part 212.

Applicant representative : Robert P. Silverberg, 202

- 944

- 3304 DOT analyst: Robert J. Finamore , 202

- 366

- 2405

Responsive pleadings: US Airways, Inc. (US Airways) filed an objection to TAM ’s request and TAM filed a reply.

In its objection, U S Airways states that in April 2011 it r eached an agreement with Infraero, the Brazilian government agency responsible for operating Brazil’s Sao Paulo

- Guarulhos airport (GRU), which would allo w US Airways to begin GRU service in late 2012

. US Airways also states that

, in April 2012

, Infraero informed the carrier that

, because GRU operations had been privatized, Infraero c ould no longer honor its agreement with US Airways and that

no decision would be made regarding US Airways’ GRU service until the new airport operator took control of GRU operations . US Airways requests that the Department deny TAM’s request until US Airways can use its bilateral rights and begin its Sao Paulo service

.

In its reply, TAM states that US Airways’ does not dispute that TAM and ABSA hold the necessary authority to conduct the proposed services or that the services are bilaterally authorized . TAM states that the objection is base d entirely on the history of US A irways’ efforts to obtain an agreement with Infraero for facilities at Sao Paulo airport

. It

further states that n 

### ot only would it be unfair to refuse to grant TAM's application based on the actions of an airport operator over which TAM has no control, but it would be inconsistent with the applicable bilateral agreement to do so.

DISPOSITION

Action: Approved , subject to attached conditions A ction date: June 26 , 2012

Effective dates of authority grant ed: Our action granting the waiver request of TAM is effective June 26 , 2012. O ur action granting the statement of authorization request of TAM is effective June 26 , 2012

, and shall remain in effect for an indefinite period , subject to conditions

.

Basis for approval (bil ateral agreement/reciprocity): Air Transport Agreement between the United States and Brazil and the Memorandum of Consultations signed March 19, 2011.

Except to the extent exempted/waived, this authority is subject to the terms, condition s, and limitations of the code

- share

conditions attached as Appendix A

.

Special conditions/Remarks: Having reviewed the full record before us, w e have decided to approve TAM’s request for a

statement of authorization to engage in all

- cargo block space/code

- share services with ABSA

. In taking this action, we

note that we are sensitive to the difficulties that US Airways is experiencing in its efforts to institute its Sao Paulo service

.

1 See Appendix B for initial proposed markets.However, i n the circumstances p resented, we are not prepared to withhold approval of the bilaterally authorized rights requested by TAM

.

Action taken by: Paul L. Gretch, Director, Office of International Aviation

_____________________________________________________________________________________________________ Under authority assigned by the Department in its regulations, 14 CFR Part 385, we found that (1) our action was consistent w ith Department policy; (2) gr ant of the authority was consistent 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/deferred/dismissed, we denied all requests in the referenced Docket. We may amend, modify, or revoke the authority granted in this Notice at any time without hearing at our discretion.

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 within seven (7) days after the date of issuance of this Notice. This action was effec tive when taken, and the filing of a petition for review will not alter such effectiveness.

An elect ronic version of this document is available on the World Wide Web at: http://www.regulations.gov

### Appendix A

The operations authorized here are subject to the following conditions:

(a) The statement of authorization will remain in effect only as long as (i) TAM and ABSA continue to hold the necessary underlying authority to operate the code

- share/blocked space services at issue, and (ii) the agreement providing for the code

- share/blocked spa ce operations remains in effect.

(b) TAM and/or ABSA must promptly notify the Department if the agreement providing for the code

- share/blocked space operations is no longer effective or if the carriers decide to cease operating all or a portion of the approved

code

- share/blocked space se rvices. Such notices should be filed in Docket DOT

- OST

- 2012

- 0089. 1

(c) TAM and/or ABSA must notify the Department no later than 30 days before they begin any new code

share/blocked space operations under the services authorized here. Such notice shall i dentify the market(s) to be served and the date on which the service will begin. Such notice should be filed in Docket DOT

- OST

- 2012

- 0089.

(d) Notwithstanding any provisions in the contract between the 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 wa ybill) accept responsibility for the entirety of the code

- share/blocked space journey for all obligations established in its contract of carriage with the shipper; that the cargo liability of the operating carrier be unaffected.

(e) The authority granted here is specifically conditioned so that neither TAM nor ABSA shall give any force or effect to any contractual provisions between themselves that are contrary to these conditions.

(f) We may amend, modify, or revoke the authority granted at any time wit hout hearing at our discretion.

1 We expect this notification to be received within ten (10) days after such non

- effectiveness or of such decision.Appendix B