Order 201 4

- 10

- 8

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation

on the 14 th day of October

, 201 4

Served: October 14

, 201 4

Application of

PRIMERA AIR SCANDINAVIA A/S Docket DOT

- OST

- 201 4

- 0 125

for an exemption under 49 U.S.C. §40109 and a foreign air carrier permit under 49 U.S.C. §41301

ORDER GRANTING EXEMPTION AND TO SHOW CAUSE

Summary

By this order we (1) grant the application of the referenced foreign air carrier for an exemption under 49 U.S.C. §40109, subject to conditions; 1 and (2) tentatively find that it is in the public interest to grant the applicant the foreign air carrier permit attached as Appendix B to this order.

Background

By Notice dated May 3, 2007, we invited foreign air carriers of the European Union (EU) to apply for Department economic authority to conduct operations to and from the United States

under the U.S.

- EU Air Transport Agreement. In that Notice, we stated our intent to process requests for this authority under the “streamlining” procedures set out in our August 23, 2005

Notice in Docket DOT

- OST

- 2005

- 22228, in which we a nnounced several steps designed to simplify our regulatory procedures for licensing foreign (and U.S.) air carriers. Our action in this Order serves to implement those streamlined regulatory procedures for the application involved in this proceeding.

Application

By application filed July 21 , 201 4

, Primera Air Scandinavia A/S ( Primera Air ), a foreign air

carrier of Denmark

, request s an exemption under 49 U.S.C §40109 and a foreign air carrier permit under 49 U.S.C. §41301, to engage in the following services :

1 The conditions are attached as Appendix A.2

a. Foreign scheduled and charter air transportation of persons

, property , and mail from any point or points behind any Member St ate of the European Union

, via any point or points in any Member State and via intermediate points

, to any point or points in the United States and beyond;

b. Foreign scheduled and charter air transportation of persons

, property , and mail between any point or points in the United States and any point or points in any member of the European Common Aviation Area;

c. Foreign scheduled and charter air transportation of cargo between any point or p oints in

the United States and any other point or points;

d. Other charters pursuant to the prior approval requirements set forth in 14 CFR Part 212 of the Department’s economic regulations; and

e. T ransportation authorized by any additional route rights made available to European

Union carriers under the U.S

. - EU Air Transport Agreement in the future.

The applicant provided evidentiary materials required by 14 CFR Part 211 of our regulations to support its requests for authority.

Responsive Pleadings

Scandinavian Airlines System ( “ SAS ” or “Scandinavian Airlines” ) filed an answer to Primera Air’s application. Primera Air filed a reply and SAS filed an additional responsive pleading. 2

SAS states that it objects to Primera Air’s application to the extent that grant of the requested authority would permit Primera Air to hold out U.S. services in the name of “Air Scandinavia” or

“Scandinavia Air.” SAS further states Primera Air’s potential use of either of these trade names,

which it claims are almost identical to that of Scandinavian Airlines

, will cause consumer confusion between the two carriers’ services. SAS asserts that confusion will also result from the geographic overlap between S AS ’ and Primera Air’s operations. SAS further asserts that if

Primera Air uses the name “Air Scandinavia” or “Scandina via Air

, ” the livery painted on the aircraft fuselage would lead to public confusion. In closing, SAS respectfully requests that the Department expressly condition the grant of Primera Air’s authority on the requirement that

Primera Air shall not hold out its services to and from the United States in the name “Air

Scandinavia” or “Scandinavia Air” to avoid consumer confusion.

In its reply, Primera Air states that it has never marketed or in any way identified itself as “Air

Scandinavia” or “Scandinavia Ai r,” or in any other guise that could conceivably be confused

with SAS , nor does it intend to do so in the future

. In support of its claim, Primera Air provides examples of the use of its name and logo in various marketing scenarios and on its aircraft livery. It notes that in none of the examples i s the word "Scandinavia" even used.

2 We grant the motion of SAS for leave to file.3

In its additional pleading, SAS notes that the words “Air” and “Scandinavia” are both part of Primera Air’s full name (Primera Air Scandinavia), and therefore maintains that it is certainly conceivable that the carrier may attempt to brand itself as “Air Scandinavia” or “Scandinavia Air” at some point in the future.

D ecision

We have decided, consistent with our August 23, 2005 Notice referenced above, to grant the applicant’s request for exemption authority, as described below and subject to conditions, and tentatively to grant, subject to show

- cause procedures, its request for a foreign air carrier permit, also subject to conditions.

Specifically, we will gra nt Primera Air exemption authority for the services set forth in ordering paragraph 1 below. We will tentatively grant Primera Air a foreign air carrier permit for these

services.

As an additional matter, Primera Air requested that we grant it, in addition to authority currently

contained in the U.S.

- EU Agreement, authority to conduct transportation authorized by any additional route rights made available to EU carriers in the future. We are granting the request of

Pr imera Air f or this authority by exemption (and tentatively granting it by foreign air carrier permit). We are, however, requiring Primera Air

, before it commences any new service under this authority, to provide us with evidence that it holds a homeland l icense for that new service, unless it has already provided such evidence. 3

With respect to the applicant’s request for exemption authority, we find that grant of this authority, as conditioned, is consistent with the public interest. We also find that t he applicant is financially and operationally qualified to perform the services authorized, and that it is substantially owned and effectively controlled in a manner consistent with the provisions of the

U.S.

- EU Agreement. 4 We also find that the authority sought by the applicant is encompassed by

the U.S.

- EU Agreement.

Further, we note that the applicant is properly licensed by its homeland to perform the proposed services. In addition, on August 7 , 201 4

, the Federal Aviation Administration advised us that it knew of no reason why we should act unfavorably on the applicant’s requests. We have verified the applicant’s compliance with 14 CFR Parts 203 (Warsaw liability waiver), and 205 (insurance requirements).

With respect to the trade name matter rais ed by SAS , we note that we do not make public interest determinations under our regulations concerning name similarity

. We have also considered

SAS ’s assertions regarding potential public confusion resulting from the name similarity between the carriers and, in the circumstances presented here, are not persuaded that the potential

3 See Orders 2007

- 6

- 19 and 2007

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- 1, and Orders 2007

- 7

- 13 and 2007

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- 16, where we granted this authority to

British Airways Plc. and Virgin Atlantic Airways Ltd., respectively.

4 We make this finding based on Article 2 (Reciprocal Recognition of Regulatory Determinations with Regard to Airline Fitness and Citizenship) of the Protocol to amend the U.S.

- EU Air Transport A greement, signed

June 24, 2010.4

exists for significant consumer confusion at this juncture. According ly, we tentatively find that the issues concerning the applicant's name do not support any special conditioning of the authority requested by Primera Air.

In view of the above, we find that grant of the requested exemption authority, as conditioned, for

a two

- year term, or until the requested permit authority becomes effective, whichever occurs earlier, is warranted.

Tentative Findings and Conclusions

-- Foreign Air Carrier Permit Application

We tentatively find and conclude that the public interest warran ts granting the applicant a foreign air carrier permit, in the form attached as Appendix B and subject to the conditions attached. 5 In particular, we tentatively find and conclude that the factors which support our grant of exemption authority to the appl icant, as discussed above, also warrant granting the applicant the foreign air carrier permit it seeks.

In view of the foregoing and all facts of record and acting under authority assigned by the Department in its regulations, 14 CFR Part 385, we tentativ ely find and conclude that:

1. It is in the public interest to issue the applicant a foreign air carrier permit in the form attached;

2. The applicant is fit, willing and able properly to perform the foreign air transportation

described in the attache d permit and to conform to the provisions of Title 49 of the U.S. Code, and to our rules, regulations, and requirements;

3. The applicant is substantially owned and effectively controlled in a manner consistent with the provisions of the U.S.

- EU Agreement;

4. The public interest requires that the exercise of the privileges granted by the permit should be subject to the terms, conditions, and limitations contained in the attached permit, and to such other reasonable terms, conditions, and limitations required by the public interest as we may prescribe;

5. The issuance of this foreign air carrier permit will not constitute a major regulatory action under the Energy Policy and Conservation Act of 1975, as defined in 14 CFR §313.4(a)(1) of o ur regulations; 6

6. The public interest does not require an oral evidentiary hearing on the application; and

7. Our action with respect to this foreign air carrier permit should, unless disapproved by the President of the United States under §41307 of Title 49 of the U.S. Code, become effective on

5 The applicant’s request for a foreign air carrier permit was summarized in the Department’s published weekly list of applications filed. This notice described the authority sought and gave interested persons an opport unity to submit evidence and objections to the award of this foreign air carrier permit authority.

6 This finding is based on the fact that the grant of this permit will not result in a near

- term net annual change in aircraft fuel consumption of 10 milli on gallons or more.5

the 61st day after its submission for §41307 review, or upon the date of receipt of advice from the President or his designee under Executive Order 12597 and implementing regulations that he

or she does not in tend to disapprove this portion of the Department’s decision under that section,

whichever occurs earlier.

In view of the above, we find that, with respect to the exemption authority we are conferring on the applicant, the applicant is qualified to perfor m those operations, and that grant of the exemption authority is consistent with the public interest and would not constitute a major regulatory action under the Energy Policy and Conservation Act of 1975.

ACCORDINGLY,

1. We grant the request of Prime ra Air Scandinavia A/S for an exemption under 49 U.S.C. §40109 for the services set forth below:

a. Foreign scheduled and charter air transportation of persons

, property , and mail from any point or points behind any Member State of the European Union via an y point or points in any Member State and via intermediate points to any point or points in the United States and beyond;

b. Foreign scheduled and charter air transportation of persons

, property , and mail between any point or points in the United States an d any point or points in any member of the European Common Aviation Area;

c. Foreign scheduled and charter cargo air transportation between any point or points in the United States and any other point or points;

d. Other charters pursuant to the prior approval requirements set forth in 14 CFR Part 212 of the Department’s economic regulations governing charters; and

e. T ransportation authorized by any additional route rights made available to European

Union carriers in the future.

2

. Primera Air Scandinavia A/S shall, before it commences any new service under subparagraph ( e ) of ordering paragraph 1 above, provide the Department in Docket DOT

- OST

- 201 4

- 0 125 with

evidence that it holds a homeland license for that new service, unless it has already provided such evidence to the Department;

3 . The exercise of the privileges granted above is subject to compliance by Primera Air

Scandinavia A/S with the conditions listed in Appendix A;

4 . Our action granting the exempt ion authority described herein, subject to the provisions of the ordering paragraphs above, is effective immediately, for a period of two years from the issue date of this order, or until the attached permit becomes effective, whichever is earlier;

5 . We may amend, modify, or revoke the exemption authority set forth herein at our discretion at any time and without hearing;6

6. We grant Scandinavian Airlines System’s motion for leave to file ;

7 . To the extent not acted upon above, we dismiss all request s for exemption authority in the referenced docket (DOT

- OST

- 201 4

- 0 125 );

8 . With respect to the applicant’s request for a foreign air carrier permit in this proceeding, we direct all interested persons to show cause why our tentative decision on that appl ication, set forth above, should not be made final;

9 . Any interested person objecting to the issuance of an order making final our tentative findings and conclusions with respect to the applicant’s request for a foreign air carrier permit shall, no

late r than twenty

- one (21) calendar days after the date of service of this order, file with the Department and serve on the parties to this proceeding, a statement of objections specifying the part or parts of the tentative findings and conclusions objected to , together with a summary of testimony, statistical data, and concrete evidence to be relied upon in support of the objections; if objections are filed, answers to objections are due no later than seven (7) calendar days thereafter;

10

. If timely and properly supported objections are filed, we will give further consideration to the matters and issues raised by the objections before we take further action;

1 1 . In the event no objections are filed, all further procedural steps shall be de emed waived, and the Department will enter an order which will (subject to Presidential review under §41307 of Title 49 of the U.S. Code) make final our tentative findings and conclusions set forth in this order; and

1 2 . We will serve a copy of this order on Primera Air Scandinavia A/S ; the Embassy of Denmark in Washington, D.C. ; the Department of State ; and the Federal Aviation Administration.

By:

PAUL L. GRETCH

Director

Office of International Aviation

(SEAL)

Appendices

An electronic version of this document is available on the World Wide Web at: http://www.regulations.govForeign Air Carrier Exemption Conditions Appendix A

In the conduct of the operations authorized, the foreign carrier applicant 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 Dep artment;

(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 chang es 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 airworth iness 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 Conven tion 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 ot her 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 pl ace, 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 a ir 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 a Member State of the European Union;

(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 requir ed 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.

EU carrier 01/2008Appendix B

Issued by

Order 201 4

- X

- XX

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY WASHINGTON, D.C.

-------------------------------------------------------- PERMIT TO FOREIGN AIR CARRIER

---------------------------------------------------------

P RIMERA A IR S CANDINAVIA A/S

A Foreign Air Carrier of Denmark

is authorized, subject to the following provisions, the provisions of Title 49 of the U.S. Code, and the orders, rules, and re gulations of the Department of Transportation, to engage in:

Foreign scheduled and charter air transportation of persons

, property , and mail from any point or points behind any Member State of the European Union via any point or points in any Member State and via intermediate points to any point or points in the United States and beyond;

Foreign scheduled and charter air transportation of p ersons , property , and mail between any point or points in the United States and any point or points in any member of the European Common Aviation Area;

Foreign scheduled and charter cargo air transportation between any point or points

in the United State s and any other point or points;

Other charters pursuant to the prior approval requirements set forth in 14 CFR Part 212 of the Department’s economic regulations governing charters; and

T ransportation authorized by any additional route rights made avai lable to European Union carriers in the future; provided , that the holder shall, before it commences any new service under such additional route rights, provide the Department with evidence that it holds a homeland license for that new service (unless it h as already provided such evidence to the Department). Such evidence

shall be filed in Docket DOT

- OST

- 201 4

- 0 125

.

This permit and the exercise of the privileges granted in it shall be subject to the terms, conditions and limitations in both the order issuing this permit and the attachment to this order, and to all applicable provisions of any treaty, convention or ag reement affecting international air transportation now in effect, or that may become effective during the period this permit remains in effect, to which the United States and the holder’s homeland are or shall become parties.Thi s permit shall be effectiv e on Month XX, 2014 . Unless otherwise terminated at an earlier date pursuant to the terms of any applicable treaty, convention or agreement, this permit shall terminate (1) upon the dissolution or liquidation of the holder to whom it was issued; (2) upon the effective date of any treaty, convention, or agreement or amendment, which shall have the effect of eliminating the right for the service authorized by this permit from the service which may be operated by airlines of the European Union and its Member States (or, if the right is partially eliminated, then the authority of this permit shall terminate in like part); or (3) upon the termination or expiration of the applicable air services agreement between the United States and the European Union and its M ember States. However, clause (3) of this paragraph shall not apply if prior to such termination or expiration, the foreign air transportation authorized herein becomes the subject of another treaty, convention or agreement to which the United States and the European Union and its Member States become parties.

The Department of Transportation has executed this permit and affixed its seal on Month XX,

2014.

By:

PAUL L. GRETCH

Director

Office of International Aviation

(SEAL)Foreign Air Carrier Permit Conditions

In the conduct of the operations authorized, the foreign carrier applicant shall:

(1) Not conduct any operations unless it holds a currently effective authorization from its homeland for such operations, and it has filed a cop y 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, includi ng, 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 cha rter 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, an d, 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 cha nges 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 au thorized by the Department, originate or terminate all flights to/from the United States in a Member State of the European Union;

(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.

EU carrier 1/2008