Re: Caribbean Airlines Limited (CAL) : Exemption Renewal Application 

Docket No. : OST-2010-0232

1. I, John Gilmore, was a party to the OST-2010-0232 proceedings in which the 

exemption authority, sought to be extended and renewed through the instant 

application, was granted by Notice of Action Taken on February 10, 2011.

This is my Answer to the subject Exemption Renewal Application and is without 

prejudice to my February 10 preliminary response thereto relative to certain matters of 

a procedural nature bearing on its substantive sufficiency and validity in which I 

requested certain rulings from the Department.

2. The exemption authority sought to be renewed is “seventh-freedom authority 

....... extrabilateral for a foreign air carrier of Trinidad & Tobago” (February 10, 2011 

Notice of Action Taken).

3. As an extrabilateral authority, operations under such authority are not subject to

the bilateral regime (the Jamaica - US Open Skies Agreement )nor to the protections 

therein afforded to airlines of either party “from prices that are artificially low due to 

direct or indirect governmental subsidy or support.” 

CAL receives a subsidy from its homeland government equal to the difference 

between the price it pays for aviation fuel and US$ 1.50 per US gallon – information 

the Department’s regulations require that it divulge in any licensing proceeding such 

as this – a requirement it has ignored.

CAL has further ignored the requirement to provide Financial Statements for the past 

two years – statements that would have revealed the nature and extent of its fuel 

subsidy without which it would have suffered a substantial loss in each of those years.

It is worth noting that had American Airlines had a similar subsidy in FY 2011 its

fuel cost of $ 8.304 billion at an average per gallon cost of $ 3.13 would have been 

$ 3.980 billion at $ 1.50 per gallon and instead of an Operating Loss of $ 1.054 billion 

American would have made an Operating Profit of $ 3.270 billion and arguably would 

not be in Chapter 11 bankruptcy proceeding threatening the interests of its 

shareholders, creditors, suppliers and employees and the travelling public.

However, to the extent that American’s financial problems may have been or may be 

continuing to be caused, in part, by artificially low prices charged by CAL due to direct 

or indirect government subsidy or support, they are not subject to challenge under the 

bilateral – being extrabilateral.

This evasion of the bilateral agreement through the ‘extrabilateral’ authority sought to 

be extended in this application as shown in the above example and equally true with 

respect to the entire negotiated bilateral air transportation regime between Jamaica 

and the US can hardly be “in the public interest”.

4. The Jamaica – US bilateral provides for airlines of each party to access the 

rights under the bilateral in a structured and orderly fashion. An airline of Jamaica 

needs to be designated by Jamaica and substantially owned and effectively controlled 

by nationals of Jamaica to access such rights. Departmental precedent envisions the 
waiver of the homeland ownership and control requirements of an airline designated 

under the bilateral where determined to be in the public interest.

There would in effect be no need for ‘extrabilateral authority’ and the evasion of the 

provisions of the bilateral regime if CAL were designated by Jamaica under the 

bilateral, which has not been done, and if it applied for and justified an exemption from 

the ownership and control requirements thereof; an exemption consistent with 

Departmental precedent in similar situations (i.e In situations where the US has open 

skies agreements with the homeland of the airline seeking the exemption as well as 

the state of designation and is not otherwise inimical to US interests.).

I would argue that having a bilateral air transportation regime in place, particularly as 

here an Open Skies regime, is conclusive that the public interest lies in adherence to 

the structured and orderly terms of such negotiated bilateral regime – the more so

where the authority sought, as here on an extrabilateral basis, can, on valid 

application, be granted within such bilateral regime based on Departmental precedent.

The applicant has had a year in which to file a compliant application and effect the 

changes necessary to secure the authority requested within the bilateral regime.

5. I have in my February 10 submission complained that the applicant here has 

made no effort to provide the information required under the Departmental regulations 

governing such applications. I made the same argument in my September 27, 2010 

Answer to the original Exemption Application – an argument that was ignored.

Those regulations in their ordinary meaning require an applicant to provide certain 

specified information in support of any application for foreign air transportation 

authority; initial, renewal, transfer or variance.

6. In conclusion, here we have a situation where not only are the Departmental 

procedural and evidentiary regulations designed to protect the public interest not being 

enforced but the bilateral regime, negotiated to protect the public interest with respect 

to air transportation between Jamaica and the US, is not being applied. 

Grant of the renewal requested based on an insufficient, manifestly defective 

application and on an unjustified extrabilateral baisis (since options within the bilateral 

are available) is, in my submission, neither necessary nor in the public interest.

The authority requested should in my submission be extended for a minimum period 

to permit the applicant to resubmit a compliant application for such authority under the

bilateral regime. 

Respectfully submitted this 24th day of February, 2012 by and on behalf of

/s/ John Gilmore 

_______________________

John Gilmore

48 – 7 St. Antoine West

Montreal, QC H2Z 1G8

514 716 7665

jptgilmore@hotmail.com
CERTIFICATE OF SERVICE 

I hereby certify that on this 24th day of February, 2012, a copy of this Certificate of 

Service and of my foregoing Answer to the February 9, 2012 Exemption Renewal 

Application DOCKET DOT-OST-2010-0232 filed on behalf of Caribbean Airlines 

Limited was filed on the Docket at www.regulations.gov and served by electronic mail : 

On Counsel for the Applicant at John@mietuslaw.com ; 

on Paul Gretch and Robert Finamore of the US DOT at paul.gretch@dot.gov and 

robert.finamore@dot.gov; and, 

on each of the persons named below in the Service List provided by the Applicant .

/s/ John Gilmore 

_______________________________ 

John Gilmore

48 – 7 St. Antoine West

Montreal, QC H2Z 1G8

514 716 7665

jptgilmore@hotmail.com

carl.nelson@aa.com; Robert.wirwick@aa.com;

sascha.vanderbellen@delta.com; jeff.morgan@delta.com;

jonathanlinde@united.com; steve.morrissey@united.com; dan.weiss@united.com; 

bkeiner@crowell.com; 

lbmurphy@crowell.com; lhalloway@crowell.com;

msinick@ssd.com;

efaberman@rf.com; bob.kneisley@wnco.com; for AirTran

howard.kass@usairways.com, benjamin.slocum@usairways.com;

anita.mosner@hklaw.com; for UPS

nssparks@fedex.com; gnleopard@fedex.com;

mlbenge@zsrlaw.com; for North American/World

pmurphy@gghairlaw.com; sharfst@usa3000airlines.com;

jrichardson@johnlrichardson.com; jcanny@amerijet.com;

john.fredericksen@suncountry.com;

jyoung@yklaw.com; dkirkstein@yklaw.com; for Spirit

charters@evergreenairlines.com; ben.graves@evergreenairlines.com;

jhill@dowlohnes.com; for JetBlue 

urskr@state.gov;

john.allen@faa.gov