**Re: Caribbean A** **irlines Limited (CA** **L) : Exemption Renewal A** **pplication 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 appl ication, 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 substa ntive 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 b etween 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 wou ld 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 a n 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 $ 3.27 0 billion and arguably would not be in Chapter 11 bankruptcy proceeding threatening the interests of its shareholders, cre ditors, 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 exte nded 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 thewaiver 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 s uch 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 chang es 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 suppo rt 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 in terest 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 defecti ve 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 minim um 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 We st Montreal, QC H2Z 1G8 514 716 7665 jptgilmore@hotmail.com**CERTIFICA TE OF SERVICE** 

I hereby certify that on this 24th day of Februa ry, 2012 , a copy of this Certificate of Service and of my foreg oing 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 mai l : 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 We st 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