Order 2012-5-15

 UNITED STATES OF AMERICA

 DEPARTMENT OF TRANSPORTATION

 OFFICE OF THE SECRETARY

 WASHINGTON, D.C.

Issued by the Department of Transportation

on the 17th day of May, 2012

Served: May 17, 2012

Application of

JOINT STOCK COMPANY AIRCOMPANY 

“YAKUTIA”

 Docket DOT-OST-2012-0047

 

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

On August 23, 2005, the Department issued a Notice, in Docket DOT-OST-2005-22228, 

announcing several steps designed to streamline our regulatory procedures for licensing U.S. and 

foreign air carriers. Among other things, the Notice stated that:

Assuming, based on the record and on the public interest/public convenience and 

necessity elements germane to our licensing decisions, that we were in a position to act 

favorably, we would proceed to issue a single order (1) granting the exemption request 

for whatever duration we would normally have imposed, or until certificate/permit 

authority becomes effective, whichever is shorter, and (2) tentatively deciding (i.e., 

show-cause) to award a corresponding certificate (or permit), again for the standard 

duration we would normally have imposed (such as, in the case of certificates, five 

 1 The conditions are attached as Appendix A.
2

years for limited-entry markets, indefinite for open-entry markets, and in the case of 

permits, five years for comity and reciprocity regimes, indefinite for agreement 

regimes).

Our action in this Order serves to implement these streamlined regulatory procedures for the 

application involved in this proceeding.

Application

By application filed March 27, 2012, Joint Stock Company Aircompany “Yakutia” (Yakutia), a 

foreign air carrier of the Russian Federation, requests an exemption under 49 U.S.C. §40109, and 

a foreign air carrier permit under 49 U.S.C. §41301, to engage in (1) scheduled foreign air 

transportation of persons, property, and mail between any point or points in the Russian 

Federation and any point or points in Alaska; (2) charter foreign air transportation of persons, 

property, and mail between any point or points in the Russian Federation and any point or points 

in the United States; and (3) other charter operations in accordance with Part 212 of the 

Department’s economic regulations.

The applicant provided evidentiary materials required by 14 CFR Part 211 of our regulations to 

support its requests for authority.

No answers were filed to Yakutia’s application.

Decision

We have decided, under assigned authority and consistent with our August 23, 2005 Notice 

referenced above, to grant the applicant’s request for exemption authority, subject to conditions, 

and tentatively to grant, subject to show-cause procedures, its request for a foreign air carrier 

permit, also subject to conditions.

With respect to the applicant’s request for exemption authority, we find that grant of this 

authority is consistent with the public interest; that the applicant has demonstrated, based on the 

record, that it is financially and operationally qualified to perform the services authorized; and 

that it is substantially owned and effectively controlled by a regional government and citizens of the 

Russian Federation.

2

 2 Yakutia states that the Ministry of Property and Real Estate Affairs of the Republic of Sakha (Yakutia) holds 

94.64% of Yakutia’s capital stock, and that the State Unitary Enterprise “Committee for Precious Metals and Gems 

of the Republic of Sakha (Yakutia)” holds the remaining 5.36 percent. Thus, all of Yakutia’s shares are held by the 

regional government of the Republic of Sakha (Yakutia). Yakutia further states that its Director General and key 

management personnel are Russian citizens.
3

The authority sought by the applicant is encompassed by the 1994 U.S.-Russia Air Transport 

Agreement.

3

 We therefore find that grant of the requested exemption authority, for a one-year 

term, or until the requested permit authority becomes effective, whichever occurs earlier, is 

warranted.

We also note that the applicant is properly licensed by its homeland to perform the proposed 

services. In addition, on April 5, 2012, 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).

Finally, in the conduct of the charter services authorized and tentatively authorized herein, 

Yakutia must adhere to (1) the conditions attached to this order; (2) FAA-approved flight 

routings; and (3) the Air Transport Agreement between the United States and the Russian 

Federation, including its Annexes. In accordance with 14 CFR §212.9(d) and (e) of the 

Department’s rules, Yakutia shall not perform any charter(s) unless specific authority in the form 

of a statement of authorization for such charter(s) has been granted by the Department. 

Applications for the statements of authorization required above shall be filed in accordance with 

the procedures set forth in 14 CFR §212.10.

Tentative Findings and Conclusions--Foreign Air Carrier Permit Application

We tentatively find and conclude that the public interest warrants granting the applicant a foreign 

air carrier permit, in the form attached as Appendix B and subject to the conditions attached.4

 In 

particular, we tentatively find and conclude that the factors which support our grant of exemption 

authority to the applicant also warrant granting the applicant the foreign air carrier permit it 

seeks.

In view of the foregoing and all facts of record, we tentatively 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 attached permit and to conform to the provisions of Title 49 of the U.S. Code, 

and to our rules, regulations, and requirements;

 3 On February 13, 2009, the United States and the Russian Federation agreed, ad referendum, to revised Annexes to 

the U.S.-Russia Air Transport Agreement and stated that, pending their entry into force, their respective aeronautical 

authorities intend to implement the provisions of those Annexes on the basis of comity and reciprocity. 4 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 opportunity to 

submit evidence and objections to the award of this foreign air carrier permit authority. As noted above, no answers 

to the application were filed.
4

3. The applicant is substantially owned and effectively controlled by a regional government and 

citizens of its claimed homeland;

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 our 

regulations;5

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 

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 intend to disapprove this portion of the Department’s decision under that section, 

whichever occurs earlier.

In view of the above, and acting under authority assigned by the Department in its regulations, 

14 CFR Part 385, we find that (1) our actions are consistent with Department policy; and (2) with 

respect to the exemption authority we are conferring on the applicant, the applicant is qualified to 

perform 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 Joint Stock Company Aircompany “Yakutia” for an exemption under

49 U.S.C. §40109 to permit it to engage in (1) scheduled foreign air transportation of persons, 

property, and mail between any point or points in the Russian Federation and any point or points 

in Alaska;6 (2) charter foreign air transportation of persons, property, and mail between any point 

or points in the Russian Federation and any point or points in the United States; and (3) other 

charter operations in accordance with Part 212 of the Department’s economic regulations;

2. The exercise of the privileges granted above is subject to compliance by Joint Stock Company 

Aircompany “Yakutia” with the conditions listed in Appendix A, and to the conditions that, in 

 5 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 million gallons or more.

6 Yakutia is currently designated by the Russian Federation to serve the Petropavlovsk/Kamchatsky-Anchorage and 

Khabarovsk-Anchorage routes. With regard to the broader scheduled authority granted and tentatively granted 

herein, the applicant must be appropriately designated by its homeland prior to holding out or operating such 

services.
5

the conduct of the charter services authorized herein, Joint Stock Company Aircompany 

“Yakutia” must adhere to (1) FAA-approved flight routings; and (2) the Air Transport 

Agreement between the United States and the Russian Federation, including its Annexes. In 

accordance with 14 CFR §212.9(d) and (e) of the Department’s rules, Joint Stock Company 

Aircompany “Yakutia” shall not perform any charter(s) unless specific authority in the form of a 

statement of authorization for such charter(s) has been granted by the Department. Applications 

for statements of authorization required above shall be filed in accordance with the procedures 

set forth in 14 CFR §212.10;

3. Our action granting the exemption authority described herein is effective immediately, for a 

period of one year from the issue date of this order, or until the attached permit becomes 

effective, whichever is earlier;

4. We may amend, modify, or revoke the exemption authority set forth herein at our discretion 

at any time and without hearing;

5. To the extent not acted upon above, we dismiss the applicant’s request for exemption 

authority in Docket DOT-OST-2012-0047;

6. 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 application, set 

forth above, should not be made final;

7. 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 

later 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;

8. 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;

9. In the event no objections are filed, all further procedural steps shall be deemed 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

10. We will serve a copy of this order on Joint Stock Company Aircompany “Yakutia;” the 

Embassy of the Russian Federation in Washington, D.C.; the Department of State (Office of 

Aviation Negotiations); and the Federal Aviation Administration.
6

Persons entitled to petition the Department for review of this order under the Department’s 

regulations, 14 CFR §385.30, may file their petitions within seven (7) days after the date of 

issuance of this order. Our action with respect to the applicant’s request for exemption authority 

under 49 U.S.C. §40109 is effective immediately, and the filing of a petition for review will not 

alter such effectiveness.

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.gov
Foreign Carrier Exemption Conditions Appendix A

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, 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 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 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 authorized 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 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.

12/2007
Appendix B

Issued by

Order 2012-__-__

 UNITED STATES OF AMERICA 

 DEPARTMENT OF TRANSPORTATION 

 OFFICE OF THE SECRETARY

 WASHINGTON, D.C.

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

PERMIT TO FOREIGN AIR CARRIER

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

Joint Stock Company Aircompany “Yakutia”

A Foreign Air Carrier of the Russian Federation

is authorized, subject to the following provisions, the provisions of Title 49 of the U.S. Code, 

and the orders, rules, and regulations of the Department of Transportation, to engage in:

Scheduled foreign air transportation of persons, property, and mail between any point 

or points in the Russian Federation and any point or points in Alaska; and

Charter foreign air transportation of persons, property, and mail between any point or 

points in the Russian Federation and any point or points in the United States.

The holder shall also be authorized to engage in other charter trips in foreign air transportation, 

subject to the terms, conditions, and limitations of the Department’s regulations governing 

charters.

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 agreement 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.

This permit shall be effective on _____________. 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 bilateral right for the service authorized by this permit from the service 

which may be operated by airlines designated by the Government of the Russian Federation (or, 

if the right is partially eliminated, then the authority of this permit shall terminate in like part); 

(3) upon the effective date of any permit granted by the Department to any other carrier 

designated by the Government of the Russian Federation in lieu of the holder; or (4) upon the 

termination or expiration of the applicable air services agreement between the United States and 

the Russian Federation. However, clause (4) 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 Russian Federation

become parties.
The Department of Transportation has executed this permit and affixed its seal on 

_____ __, 2012.

By:

PAUL L. GRETCH

Director

Office of International Aviation

(SEAL)
Foreign Carrier Permit 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, 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 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 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 authorized 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 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.

12/2007