I

103D CONGRESS

1ST SESSION H. R. 926

To amend the Federal Aviation Act of 1958 to authorize the Secretary

of Transportation to reduce under certain circumstances the percentage

of voting interests of air carriers which are required to be owned or

controlled by persons who are citizens of the United States.

IN THE HOUSE OF REPRESENTATIVES

FEBRUARY 17, 1993

Mr. CLINGER (for himself and Mr. SHUSTER) introduced the following bill;

which was referred to the Committee on Public Works and Transportation

A BILL

To amend the Federal Aviation Act of 1958 to authorize

the Secretary of Transportation to reduce under certain

circumstances the percentage of voting interests of air

carriers which are required to be owned or controlled

by persons who are citizens of the United States.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. REDUCTION OF U.S. CITIZENSHIP VOTING IN4 TEREST OWNERSHIP REQUIREMENT.

5 Title IV of the Federal Aviation Act of 1958 (49

6 U.S.C. App. 1371–1389) is amended by adding at the end

7 the following new section:
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1 ‘‘SEC. 420. REDUCTION OF U.S. CITIZENSHIP VOTING INTER2 EST OWNERSHIP REQUIREMENT.

3 ‘‘(a) GENERAL RULE.—Notwithstanding the require4 ment of section 101(16) of this Act that at least 75 per5 cent of the voting interests of an air carrier be owned or

6 controlled by persons who are citizens of the United States

7 or of one of its possessions, a person who is not a citizen

8 of the United States may purchase voting interests of a

9 corporation or association which is, or owns or controls,

10 an air carrier without regard to whether or not such pur11 chase would result in the corporation or association failing

12 to meet such voting interest requirement of section

13 101(16) if the Secretary of Transportation finds that—

14 ‘‘(1) after the purchase—

15 ‘‘(A) the president, chairman of the board

16 of directors, chief operating officer, and two17 thirds or more of the board of directors of the

18 corporation or association which is, or owns or

19 controls, the air carrier would be citizens of the

20 United States or one of its possessions; and

21 ‘‘(B) at least 51 percent of the voting in22 terests of the air carrier would be owned or

23 controlled by persons who are citizens of the

24 United States or one of its possessions; and

25 ‘‘(2) the purchase is in the public interest.
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1 ‘‘(b) FACTORS TO CONSIDER FOR PUBLIC INTEREST

2 FINDING.—The Secretary, in making the finding required

3 by subsection (a)(2), shall consider the following:

4 ‘‘(1) The financial condition of the air carrier

5 and the importance of the purchase to the carrier’s

6 ability to survive and effectively compete.

7 ‘‘(2) The effect of the purchase on the employ8 ees of the air carrier.

9 ‘‘(3) The effect of the purchase on competition

10 in interstate, overseas, and foreign air transpor11 tation.

12 ‘‘(4) Whether the laws and regulations of the

13 foreign country of which the purchaser is a citizen

14 would permit a citizen of the United States to ac15 quire, under similar terms and conditions, the same

16 percentage of stock of a person who provides in such

17 foreign country transportation by aircraft of persons

18 or property as a common carrier as the percentage

19 of stock which the person making the purchase

20 would have in the air carrier after the purchase.

21 ‘‘(5) The extent to which the purchaser is

22 owned, controlled, or subsidized by a government of

23 a foreign country.

24 ‘‘(6) The extent to which a person who is not

25 a citizen of the United States or one of its posses-
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1 sions would, after the purchase, have the power to

2 exercise control over the air carrier.

3 ‘‘(7) The extent to which the foreign country of

4 which the purchaser is a citizen permits air carriers

5 to have access to its aviation markets equivalent to

6 the access that the foreign citizen would have to the

7 aviation markets of the United States after the pur8 chase.

9 ‘‘(c) APPLICATION.—

10 ‘‘(1) SUBMISSION.—A person interested in

11 making a purchase with respect to which subsection

12 (a) applies must submit an application with respect

13 to such purchase to the Secretary. The application

14 must be in such form and contain such information

15 as the Secretary may, by regulation, require.

16 ‘‘(2) APPROVAL OR DISAPPROVAL.—Within 90

17 days after an application meeting the requirements

18 of paragraph (1) and any regulations issued there19 under is submitted to the Secretary, the Secretary

20 shall approve the application, approve the applica21 tion subject to such conditions or modifications as

22 the Secretary determines appropriate to carry out

23 the objectives of this section, or disapprove the ap24 plication.

25 ‘‘(3) PRESIDENTIAL REVIEW.—
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1 ‘‘(A) PRESENTATION.—The approval, with

2 or without conditions or modifications, of any

3 application under this section shall be presented

4 to the President for review.

5 ‘‘(B) DISAPPROVAL; CONDITIONS.—The

6 President shall have the right to disapprove or

7 impose conditions on the application solely on

8 the basis of national defense considerations in9 cluding the effect of the purchase on the Civil

10 Reserve Air Fleet program. Any such dis11 approval or conditions shall be issued in a pub12 lic document, setting forth the reasons for the

13 disapproval or conditions to the extent national

14 security permits, within 30 days after submis15 sion of the Secretary’s action to the President.

16 ‘‘(C) EFFECT OF DISAPPROVAL.—Any ac17 tion of the Secretary disapproved by the Presi18 dent under this paragraph shall be null and

19 void.

20 ‘‘(D) EFFECT OF EXPIRATION OF TIME

21 LIMIT; JUDICIAL REVIEW.—Any action of the

22 Secretary not disapproved within the 30-day pe23 riod referred to in subparagraph (B) shall take

24 effect as an action of the Secretary, not the

25 President, and as such shall be subject to judi-
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1 cial review as provided in section 1006 of this

2 Act.’’.

3 SEC. 2. CONFORMING AMENDMENT.

4 The table of contents contained in the first section

5 of the Federal Aviation Act of 1958 is amended by adding

6 at the end of the matter relating to title IV of such Act

7 the following:

‘‘Sec. 420. Reduction of U.S. citizenship voting interest ownership requirement.

‘‘(a) General rule.

‘‘(b) Factors to consider for public interest finding.

‘‘(c) Application.’’.

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