UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

Issued by the Department of Transportation on June 30, 2014

NOTICE OF ACTION TAKEN -- DOCKETS DOT-OST-2014-0107 and DOT-OST-2014-0108

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This serves as notice to the public of the action described below, taken by the Department official indicated (no 

additional confirming order will be issued in this matter).

Joint Applicants: CHINA EASTERN AIRLINES CORPORATION LTD. (China Eastern); and 

 VIRGIN AMERICA INC. (Virgin America)

Date Filed: June 17, 2014

Relief requested: Exemption under 49 USC §40109 to permit China Eastern to engage in scheduled foreign air 

transportation of persons, property and mail on a code share only basis with Virgin America between points in the 

United States. The applicant requests that the authority be granted for a period of two years.

Blanket statement of authorization under 14 CFR Part 212 permitting Virgin America to display China Eastern’s 

“MU” designator code on flights operated by Virgin America between any points in the United States, in conjunction 

with foreign air transportation of persons, property, and mail held out by China Eastern between China and the United 

States.

The joint applicants further request a waiver of the 45-day advance filing requirement under 14 CFR Part 212.1

Applicant representatives: Evelyn D. Sahr and Drew M. Derco (China Eastern), 202-659-6600; and

 Malcolm L. Benge and Jonathon H. Foglia (Virgin America) 202-298-8660

DOT analyst: Brett D. Kruger, 202-366-8025

Responsive pleadings: None.

DISPOSITION

Action: Approved in part, remainder (request for longer-term exemption authority) dismissed.

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Action date: June 30, 20143

Effective dates of authority granted: The exemption authority granted to China Eastern is effective June 30, 2014, 

through June 30, 2015.

The statement of authorization granted to Virgin America is effective June 30, 2014, and will remain in effect 

indefinitely, subject to conditions.

Basis for approval (bilateral agreement/reciprocity): The authority granted is consistent with the aviation agreement 

between the United States and the People’s Republic of China.

 1 The joint applicants filed a motion requesting confidential treatment of their unredacted Codeshare Agreement under 14 CFR 

§302.12. We will grant the motion.

2 The one-year duration of the exemption authority we granted China Eastern is consistent with our usual policy of granting 

exemption authority in the circumstances presented. We therefore dismissed the application to the extent that it sought authority 

for a longer period.

3 We acted on this application without awaiting expiration of the answer period with the consent of all parties served.
Except to the extent exempted/waived, this authority is subject to the terms, conditions, and limitations of our standard 

exemption conditions (attached as Appendix A); the code-share conditions (attached as Appendix B); and to the 

otherwise-applicable terms, conditions, and limitations of China Eastern’s foreign air carrier permit (Order 92-11-7).

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

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Under authority assigned by the Department in its regulations, 14 CFR Part 385, we found that (1) our action was consistent with 

Department policy; (2) the applicants were qualified to perform their proposed operations; (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 

Conservation Act of 1975. To the extent not granted/deferred/dismissed, we denied all requests in the referenced Dockets. 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
APPENDIX A

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 with 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 holder’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 Security 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 with 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) Agree 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 carriage 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 "international 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 flights 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 applicable 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.

12/2007
APPENDIX B

The code-share operations authorized here are subject to the following conditions:

(a) The statement of authorization will remain in effect only as long as (i) China Eastern and Virgin America 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 remains in effect.

(b) China Eastern and/or Virgin America 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. Such notice should be filed in Docket DOT-OST-2014-0108.

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(c) China Eastern and/or Virgin America must promptly notify the Department if the code-share agreement providing 

for the code-share operations is no longer effective or if the carriers decide to cease operating all or a portion of the 

approved code-share services. Such notice should be filed in Docket DOT-OST-2014-0108.

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(d) The code-sharing operations conducted under this authority must comply with 14 CFR 257 and with any 

amendments to the Department’s regulations concerning code-share 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 the 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 code-share journey for all obligations established in its 

contract of carriage with the passenger; and that the passenger liability of the operating carrier be unaffected.

(e) The authority granted here is specifically conditioned so that neither China Eastern nor Virgin America shall give 

any force or effect to any contractual provisions 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.

 4 See Appendix C for a list of initial code-share points. 5 We expect this notification to be received within ten (10) days after such non-effectiveness or of such decision.
APPENDIX C

List of Initial Code-Share Routes

Display of China Eastern's "MU" Designator Code on Virgin America Operated Flights

From/To Los Angeles, California (LAX)

Boston, Massachusetts (BOS)

Dallas Love Field, Texas (DAL)

Dallas/Fort Worth, Texas (DFW)

Fort Lauderdale, Florida (FLL)

New York, New York (JFK)

Las Vegas, Nevada (LAS)

Chicago, Illinois (ORD)

Seattle, Washington (SEA)

From/To San Francisco, California (SFO)

Dallas Love Field, Texas (DAL)

Dallas/Fort Worth, Texas (DFW)

Newark, New Jersey (EWR)

Washington, D.C. (IAD)

New York, New York (JFK)

Las Vegas, Nevada (LAS)

Los Angeles, California (LAX)

Chicago, Illinois (ORD)

Seattle, Washington (SEA)

San Diego, California (SAN)