UNITED STATES OF AMERICA DEPARTMENT OF TRANSPORTATION OFFICE OF THE SECRETARY WASHINGTON, D.C. Issued by the Department of Transportation on April 4, 201 1 

### NOTICE OF ACTION TAKEN -- DOCKET DOT - OS T - 20 0 7 - 28896 DOCKET DOT - OST - 2011 - 0058

_____________________________________________________________________________________________________________________________ ___ This serves as notice to the public of the action described below, taken b y the Department official indicated (no additional confirming order will be issued in this matter). Applicant s 

### : Croatia Airlines Date Filed: March, 4, 2011, as amended March 15, 2011



### Scandinavian Airlines System March 18, 2 011 Rel ief requested: Croatia Airlines
— Renew exemption from 49 U.S.C. § 4130 1 to engage in scheduled foreign air transportation of persons, property and mail from points behind Croatia, via Croatia and any intermediate points, to any point or points in the Un ited States and beyond pursuant to a code
- share agreement with United Air Lines; Inc. (United); and (2) amend the exemption authority to the extent necessary to allow it to code share with Scandinavian Airlines System (SAS) in addition to United. 1 If rene wal, date and citation of last action: March 22, 2010, in this docket Scandinavian Airlines System
— Statement of authorization under 14 CFR Part 212 to the extent necessary to permit SAS to display Croatia Airlines’ OU* designator code on flights operated by SAS between (i) any point or points in the United States and any point or points in the European Union (on a nonstop basis and intermediate routings via open
- skies points); (ii) a point or points in the United States and any other point or points in th e European Common Aviation Area, where an open
- skies agreement is being applied; (iii) EU points; and (iv) beyond the U.S. or EU to any point or points in conjunction with services between the United States and Croatia. Applicant representative s : Croati a Airlines: David Heffernan (202) 663
- 6360 SAS: Michael Goldman (202 944
- 3300 DOT Analyst: Shelita A. Johnson (202) 366
- 1226 Responsive pleadings: None filed DISPOSITION Action: Approved , subject to conditions (see below) A ction date : April 4, 201 1 Effective dates of exemption authority granted Croatia Airlines : April 4, 2011

– April 4, 2012 Effective dates of statement of authorization authority granted SAS : April 4, 201 1

– and will remain in effect indefinitely, subject to the condition s below. Basis for approval (bilateral agreement/reciprocity)
. For Croatia Airlines: U.S.
- Croatia Air Transport Agreement For SAS: U.S.
- EU Agreement Except to the extent exempted/waived, this authority is subject to the terms, conditions, and limitations indicated: X Standard exemption conditions (attached The code - share operations authorized here are subject to the following conditions : a) The statement of authori zation will remain in effect only as long as (i) Croatia Airlines, United and SAS continue to hold the necessary underlying authority to operate the code
- share services at issue, and (ii) the code
- share agreement providing for the code
- share operations rem ains in effect.

1 Croatia Airlines also has a pending request in Docket DOT
- OST
- 2007
- 28895. We w ill act on the permit portion of its request separately.(b) Croatia Airline s, United and SAS must promptly notify the Department (Office of International Aviation) if the code
share agreement providing for the code
- share operations is no longer effective or the carriers decide to cease operati ng any or all of the approved code
- share services. We expect this notification to be received within 10 days of such non
effectiveness or of such decision. Such notice should be filed in Docket DOT
- OST
- 200 7
- 2 889 6
. (c) Croatia Airlines , United and SAS must notify the Department no later than 30 days before they begin any new code
share service under the code
- share services authorized here. Such notice shall identify the market(s) to be served and the date on which the service will begin. 2 Such notices should be filed in Docket DOT
- OST
- 200 7
- 2889 6
. (d) The codesharing operations conducted under this authority must comply with 14 CFR Part 257 and with any amendments to the Department’s regulations concerning codeshare arrangements that may be adopted. 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 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 codeshare journey for all obligations established in its contract of carriage with the passenge r; 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 who se airspace the Federal Aviation Administration has issued a flight prohibition; and (e) The authority granted here is specifically conditioned so that neither Croatia Airlines , United nor SAS s hall give any force or effect to any contractual provision s between themselves that are contrary to these conditions. We may amend, modify, or revoke the authority granted at any time without hearing at our discretion. 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) the applicant is qualified to perform the proposed operations; (2) our action was consistent with Department policy; (3) grant of the authority was consistent with the public interest; and (4) grant of the authority would not constitute a major regulatory action under the Energy Policy and Cons ervation 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 effective when 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

2 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, SAS has provided blanket notification of its intent to engage in code share services beginning on or about April 1, 2011, betw een open - skies points as outlined in its application.12/2007

Foreign Carrier Exemption Conditions In the conduct of the operations authorized, the foreign carrier applicant(s) shall: (1) Not conduct any operations unless it holds a currently effective authorization from its homeland for such operations, and it has filed a copy of such authorization with the Department; (2) Comply wi th all applicable requirements of the Federal Aviation Administration, the Transportation Security Administration, and with all applicable U.S. Government requirements concerning security, including, but not limited to, 14 CFR Parts 129, 91, and 36 and 49 CFR Part 1546 or 1550, as applicable. To assure compliance with all applicable U.S. Government requirements concerning security, the holder shall, before commencing any new service (including charter flights) from a foreign airport that would be the holde r’s last point of departure for the United States, contact its International Industry Representative (IIR) (formerly referred to as International Principal Security Inspector) to advise the IIR of its plans and to find out whether the Transportation Securi ty Administration has determined that security is adequate to allow such airport(s) to be served; (3) Comply with the requirements for minimum insurance coverage contained in 14 CFR Part 205, and, prior to the commencement of any operations under this authority, file evidence of such coverage, in the form of a completed OST Form 6411, with the Federal Aviation Administration’s Program Management Branch (AFS
- 260), Flight Standards Service (any changes to, or termination of, insurance also shall be filed wi th that office); (4) Not operate aircraft under this authority unless it complies with operational safety requirements at least equivalent to Annex 6 of the Chicago Convention; (5) Conform to the airworthiness and airman competency requirements of its Government for international air services; (6) Except as specifically exempted or otherwise provided for in a Department Order, comply with the requirements of 14 CFR Part 203, concerning waiver of Warsaw Convention liability limits and defenses; (7) A gree that operations under this authority constitute a waiver of sovereign immunity, for the purposes of 28 U.S.C. 1605(a), but only with respect to those actions or proceedings instituted against it in any court or other tribunal in the United States that are: (a) based on its operations in international air transportation that, according to the contract of carriage, include a point in the United States as a point of origin, point of destination, or agreed stopping place, or for which the contract of carr iage was purchased in the United States; or (b) based on a claim under any international agreement or treaty cognizable in any court or other tribunal of the United States. In this condition, the term "international air transportation" means "internation al transportation" as defined by the Warsaw Convention, except that all States shall be considered to be High Contracting Parties for the purpose of this definition; (8) Except as specifically authorized by the Department, originate or terminate all flig hts to/from the United States in its homeland; (9) Comply with the requirements of 14 CFR Part 217, concerning the reporting of scheduled, nonscheduled, and charter data; (10) If charter operations are authorized, except as otherwise provided in the app licable aviation agreement, comply with the Department's rules governing charters (including 14 CFR Parts 212 and 380); and (11) Comply with such other reasonable terms, conditions, and limitations required by the public interest as may be prescribed by the Department, with all applicable orders or regulations of other U.S. agencies and courts, and with all applicable laws of the United States. This authority shall not be effective during any period when the holder is not in compliance with the conditions imposed above. Moreover, this authority cannot be sold or otherwise transferred without explicit Department approval under Title 49 of the U.S. Code.