UNITED STATES OF AMERICA
DEPARTMENT OF TRANSPORTATION
OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation on September 21 , 20 10



### NOTICE OF ACTION TAKEN

-- DOCKET S DOT

- OST

- 20 0 7

- 26980 and DOT

- OST

- 2010

- 0205

_____________________________________________________________________________________________________________________________ ___ This serves as notice to the public of the action described below, taken by the Department official indic ated (no additional confirming order will be issued in this matter).

Applicant: JADE CARGO INTERNATIONAL COMPANY LIMITED ( Jade Cargo )

Date Filed: August 11 , 20 10

Relief requested: E xemption under 49 USC § 4 0109, and a foreign air carrier permit under 49 U.S.C. §41301, to permit the applicant to engage in (1) scheduled foreign air transportation of property and mail between any point or points in the People’s Republic of China (PRC) , via any intermediate poin ts, to any point or points in the United States open to scheduled international operations

, and beyond to any points outside the United States ; (2) charter foreign air transportation of property and mail from any point or points in the PRC, on the one hand , and any point or points in the United States, on the other hand; and (3) other charters pursuant to 14 CFR Part 212 of the Department’s regulations. 1

Jade Cargo states that it plans to initially operate scheduled all

- cargo service over a Shanghai

- Yantai

- Anchorage

Chicago

- Amsterdam

- Shanghai routing beginning on or shortly after September 20, 2010 , utilizing aircraft wet

- leased from World Airways

.

Applicant representative: David Heffernan , 202

- 6 63

- 6360 DOT analyst: Brett D. Kruger , 202

- 366

- 8025

Responsive pleadings: None.

DISPOSITION

Action: Approved request for exemption authority, subject to conditions ( specifically including the condition concerning coterminalization, see Remarks below) ; request for permit authority deferred

. 2

Action date: September 21 , 20 10

Effective dates of authority granted: September 21 , 20 10 , through September 21 , 20 1 1

.

Basis for approval: United States

- China Air Transport Services Agreement

Special conditions/Remarks: By Notice of Action Taken (NOAT) dated April 15, 2010, in Docket DOT

- OST

- 2010

- 0047, we specifically limited new coterminalization of U.S. points by China Southern Airlines Company Limited (China Southern) until such time as China’s General Administration o f Civil Aviation (CAAC) confirms the ability of Federal Express Corporation (FedEx) to implement new coterminalized segments on its U.S.

- China all

- cargo services. We are imposing the same condition on Jade Cargo here. While we will now grant Jade Cargo t he bilaterally

- agreed authority it seeks to serve U.S. points, we are not prepared at this time to permit Jade Cargo to serve any of these newly authorized points on a coterminal basis. 3

1 Jade Cargo has an application for a foreign air carrier permit pending, filed January 17, 2007 in Docket DOT

- OST

- 2007

- 26980,
for U.S.

- China all

- cargo charter authority. With respect t o the permit request in the applicant’s August 11, 2010 application, Jade Cargo seeks to amend its January 17, 2007 application to include scheduled service.

2 We will act on Jade Cargo’s permit request separately.

3 Our action here does not preclude Jade Cargo from exercising the Alaska coterminalization authority granted by Notice of Action Taken dated August 19, 2010, in Dockets DOT

- OST

- 2010

- 0200, DOT

- OST

- 1999

- 5035, and DOT

- OST

- 1996

- 1600.Based on the record in this case, we found the applicant is opera tionally and financially qualified to conduct its proposed
services. 4 With respect to the ownership and control of the applicant, the record indicates that fifty

- one percent of the shares in Jade Cargo are owned by Shenzhen Airlines Company Limited, a sub sidiary of Air China International Company, which is a state

- owned airline organized and established under the laws of the People’s Republic of China. Twenty

- five percent of the shares of Jade Cargo are owned by Lufthansa Cargo AG, a wholly

- owned subsidia ry of Deutsche Lufthansa AG, an air carrier organized and established under the laws of the Federal Republic of Germany. The remaining twenty

- four percent of the shares of Jade Cargo are held by DEG

- Deutsche Investitions

- und Entwicklungsgesellschaft mbH ( DEG Bank), a subsidiary of KfW Groups, a German state

- owned bank. The Chairman and two other Directors of Jade Cargo are citizens of China; the remaining three Directors are citizens of Germany.

Given the extent of non

- homeland ownership of Jade Cargo, and the composition of its Board of Directors, we are unable to find that the applicant is substantially owned and effectively controlled by citizens of its homeland. However, we find that it is consistent with the public interest to use our discretion a nd to waive our ownership and control standard in this instance, as we find that there is nothing in the ownership and control of Jade Cargo that would be inimical to U.S. aviation policy or interests.

In addition, we note that the carrier is properly lic ensed by the Government of China to perform the proposed services. On September 15, 2010, the FAA advised us that it knew of no reason why we should act unfavorably on Jade Cargo’s application.

Except to the extent exempted/waived, this authority is sub ject to the terms, conditions, and limitations of our standard exemption conditions (attached) . We also require Jade Cargo, in accordance with 14 CFR §212.9(d) of our regulations, to obtain prior Department approval in the form of statements of authorizat ion, before operating any charter trips to or from
the United States.

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

_____________________________________________________________________________________________________________________________ __ Under authority assigned by the Department in its regulations, 14 CFR Part 385, we found that (1) our action was consistent w it h Department policy; (2) the applicant was qualified to perform its proposed operations; (3) grant of the authority was consist ent with the public interest; and (4) grant of the authority would not constitute a major regulatory action under the Energy Poli cy and Conservation Act of 1975. To the extent not granted/deferred/dismissed, we denied all requests in the referenced Docket. We may amend, modify, or revoke the authority granted in this Notice at any time without hearing at our discretion.

Persons e ntitled 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 effec tive
wh en 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

4 Jade Cargo has requested confidential treatment of its financia l submissions under 14 CFR §302.12. Good cause having been shown, we will grant Jade Cargo’s request.

### Foreign Carrier Exemp tion 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, b ut 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 I IR 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, pr ior 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 a irworthiness 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 W arsaw 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 te rm "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 autho rized 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 r equired 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.

1 2/2007