Orde r 2010-12-2 1 Served : Decembe r

17,201 0



### UNITE D STATE S O F AMERIC A DEPARTMEN T O F TRANSPORTATIO N OFFIC E O F TH E SECRETARY WASHINGTON , D.C

. Issue db y th e Departmen t o f Transportatio n o n th e n ^ day o f

December , 201 0 Join t applicatio n o f 

### CENTURIO N AI R CARGO , INC. , SK Y LEAS E I , INC. , AN D ARROW AIR , INC

. for an exemptio n fro mth e provision s o f 4 9 U.S.C

. §4110 5 

### Docke t DOT-OST-2010-025 9

ORDE R GRANTIN G EXEMPTIO N Summary B y thi s order , w e exemp t Centurio n Ai r

Cargo , Inc

. ("Centurion") , Sky Leas e I , Inc

. ("Sky Lease") , an dArro w Air, Inc

. ("Arro w Air") , hereinafte r th e "Join t

Applicants, " fro mth e provision s o f

sectio n 4110 5 o f

Title 4 9 o f

th e Unite dState s Cod e (th e Statute) , subjec t t o certai n conditions

. 

### Backgroun d O n Jun e 29 , 2010 , Arro w Air, aU.S

. certificate dai r carrie r authorize dt o engag e i n interstat e an dforeig n schedule dall-carg o ai r transportation, ' file dfor Chapte r 1 1 bankruptc y an dcease dal l o f it s operations. ^

' Se e Orde r 2007-7-4 , Orde

r 2006-1-1 , Orde

r 2000-8-5 , Orde

r 2005-3-31 , an

dNotic e o f Action Take n i n Docke t DOT-OST-1996-1448 , Docke t DOT-OST-1996-1770 , an

dDocke t DOT-OST

1995-229

. ^ Section 204. 7 o

f ou r rule s (1 4 CF

R204.7 ) provide s that , i

f a n ai r carrie r cease s conducting th e operation s fo

r whic h i t was foun dfit , willing , an

dable , it s authorit

y t o conduct thos e operation s i s automaticall

y suspendeda s o

f the dat e thos e operation s ceased

. Unde r tha t rule

. Arrow ma y not recommenc e operation s no r advertis e suc

h service s until it s fitnes s t o d o s o ha s bee n re-establishe db

y thi s office

. Thi s orde

r doe s not permi t Arrow Ai

r t o recommenc e operation s withou

t firs t bein g refoun dfi t b y the Department

.Subsequently , o n Octobe r 14 , 2010 , Centurion , Sk y Lease , an dArro w jointl y file da n applicatio n for

apendent e lit e exemptio n fro msectio n 4110 5 o f th e Statute

. Th e partie s stat e tha t J W Acquisition , Inc

. ("JW") , aFlorid acorporatio n owne db y Mr

. Alfonz o Rey , th e sol e owne r

o f Centurio n an dSk

y Lease , submitte dan offe r t o th e Bankruptc y Court overseein g Arro w Air' s Chapte r 1 1 reorganizatio n t o purchas e Arro w an dsubsequently , JW s offe r wa s selected

. O n Decembe r 16 , 2010 , th e Bankruptc y Court approve d Arrow' s reorganizatio n pla n an dJW s acquisition

. Th e Departmen t

ha s hel dtha t

astoc k acquisitio n resultin g i n commo n contro l o f tw o o r mor e ai r carrier s havin g internationa l rout e authorit y constitute s ad e fact o transfe r subjec t t o sectio n 41105

. Th e relie f requeste dher e woul dallo w th e Join t Applicant s t o operat e unde r

commo n ownershi p pendin g th e Department' s actio n o n a contemporaneousl y filedd e fact o transfe r application. ^ I n support o f thi s request , th e Join t Applicant s stat e that , upo n consiunmatio n o f th e transaction , whil e Centurion , Sky Lease , an dArro w Air , wil l b e unde r commo n ownership , eac h wil l remai n aseparat e entity an dwil l b e operate da s separat e companies

. The y furthe r conten dthat

gran t o f th e exemptio n reques t

woul db e consisten t

with th e pas t

practic e o f

th e Department

. Arro w i s authorize dt o engag e i n interstat e schedule dall-carg o ai r transportation.' * Th e ai r carrie r als o hold s foreig n schedule dall-carg o certificat e authorit y permittin g i t t o serv e al l open-skie s partner s o f th e Unite dStates, ^ a s wel l a s foreig n schedule dall-carg o certificat e authorit y permittin g i t t o serv e 3 0 additiona l foreig n aviatio n partner s o f th e Unite dStates. ^ I n addition

. Arro w hold s exemptio n authorit y permittin g i t t o engag e i n foreig n schedule dall-carg o ai r transportatio n betwee n th e U.S

. an dVenezuel aan d betwee n th e U.S

. an dEcuador^ an dhold s ablanke t rout e integratio n certificate. ^ Centurio n hold s interstat e charte r all-carg o certificat e authority, ^ blanke t open-skie s all

carg o certificat e authority,' ° an dexemptio n authorit y t o engag e i n foreig n schedule dall

carg o ai r transportatio n betwee n th e Unite dState s an dColombia, " Brazil,' ^ th e Dominica n Republic,' ^ an dEcuador." *

^ O n Octobe r 14 , 2010 , concurren

t wit h the Join t Applicants ' exemption reques t i n Docke t DOT-OST-2010-0259 , Arrow , Centurion , an dSk y Leas e jointl y file

da n application i

n Docke t DOT-OST-2010-025 8 fo

r the Department' s approva l unde r 4 9 U.S.C

. § 4110 5 o

f th e d e fact o transfe r o f th e economi c authoritie s heldb y Arrow t o Arrow unde

r the ownershi

p o f Mr

. Alfons o Rey

. N o answer s have bee

n filed

. ' ^ Se e Orde r 2000-8-5 , issuedJul

y 27,2000

. ^ Se e Orde r 2007-7-4 , issuedMa

y 7 , 2007

. * Se e Orde r 2000-8-5 , issuedJul

y 27 , 2000 ; an

dOrde r 2005-3-31 , issuedMarc

h 8 , 2005

. ' ' Se e Notic e o f Action Taken , datedSeptembe r 1 , 2009 , i n Docke t DOT-OST-1996-144 8 an

d Docke t DOT-OST-1996-1770 ; an

dNotic e o f Action Taken , datedJul

y 18 , 2008 , i

n Docke t DOT

OST-1995-229 , respectively

. ^ Se e Orde r 2006-1-1 , issuedJanuar

y 3 , 2006

. ' Se e Orde r 2001-12-12 , issuedDecembe r 17 , 2001

. ' ° Se e Orde r 2007-7-4 , issuedMa

y 7 , 2007

. " Se e Notic e o f Action Taken , date dAugus t 10,2010 , i

n Docke t DOT-OST-2004-18880

. ' ^ Se e Notic e o f Action Taken , datedAugus t 8 , 2008 , i n Docke t DOT-OST-2008-0228

. ' ^ Se e Notic e o f Action Taken , datedJune 25 , 2009 , i n Docke t DOT-OST-2009-0141

.Sk

y Leas e hold s interstat e schedule dall-carg o certificat e authority , a s wel l a s blanke t ope n skie s all-carg o certificat e authorit y permittin g it t o serv e al l ope n skie s partner s o f th e Unite dStates , ^ an dexemptio n authorit y t o engag e i n foreig n schedule dall-carg o ai r transportatio n betwee n th e Unite dState s an dColombia.' ^ N o answer s opposin g th e Join t Applicants ' exemptio n reques t wer e filed

. 

### Decisio n W e hav e decide dt o gran t th e Join t

Applicants ' reques t

for a n exemptio n fro mth e provision s o f

sectio n 4110 5 unti l w e hav e rule do n th e d e fact o transfe r request
. Th e Join t Applicant s correctl y note dthat ou r gran t o f exemption s i n case s suc h a s thi s i s contingen t

upo n th e ai r

carrier s involved , i n thi s cas e Centurion , Sk y Lease , an dArrow , remainin g separat e an dindependentl y operate dcorporation s imti l arulin g ha s bee n mad e i n th e underlyin g d e fact o transfe r case . I n thi s case , a s i n previou s cases,' ^ w e se e n o reaso n t o withhol dexemptio n authorit y pendin g Departmenta l actio n o n th e certificat e transfe r application. A s lon g a s Centurion , Sk y Lease , an dArro w remai n separat e entities , shoul dw e disapprov e th e propose dtransfer , eithe r mwhol e o r

i n part , J W coul d dives t itsel f o f Arrow

. Th e Join t

Applicant s shoul dno t

constru e ou r

gran t o f thi s exemptio n a s adecisio n t o approv e th e relate dd e fact o transfe r applicatio n o r

any aspec t o f that application. Prio r

t o grantin g an y portio n o f tha t application , th e Departmen t wil l evaluat e th e competitiv e issue s raise db y th e operation s o f Centurion , Sk

y Lease , an d Arro w unde r

commo n ownershi p an dif appropriate , institut e actio n t o reallocat e limited

entry rout e authorit y o r

frequencie s t o othe r

unrelate dai r

carriers

. 

### ACCORDINGLY , 1

. W e exemp t

Centurio n Ai r

Cargo , Inc. , Sky Leas e I , Inc. , an dArro w Air , Inc. , fro m th e provision s o f

sectio n 4110 5 o f

th e Statute , t o th e exten t necessar y t o allo w the mt o operat e unde r

th e commo n ownershi p o f Mr

. Alfons o Rey , pendin g th e Department' s final actio n o n th e d e fact o transfe r applicatio n i n Docke t

DOT-OST-2010-0258 , subjec t t o th e conditio n that , pendin g suc h final action

. Centurio n Ai r Cargo , Inc. , Sk

y Leas e I , Inc. , an dArro w Air , Inc. , continu e t o b e maintaine dan doperate da s separat e corporations

.

" * Se e Notic e o f Action Taken , datedSeptembe r 29 , 2010 , i

n Docke t DOT-OST-2010-023 3 an

d Notic e o f Action Taken , datedSeptembe r 24 , 2009 , i

n Docke t DOT-OST-2002-12503

. ' ^ Se e Orde r 2008-9-25 , issuedSeptembe r 19 , 2008 , an

dOrde r 2008-11-4 , issuedNovembe r 6 , 2008 , respectively

. ' * Se e Notic e o f Action Taken , datedAugus t 31 , 2009 , i

n Docke t DOT-OST-2005-20285

. ' ^ Se e Orde r 89-1-60 , p . 4 ; Orde

r 97-9-3 , p . 3 ; Orde

r 97-11-8 , p . 5 ; Orde

r 99-4-5 , p . 4 ; an

d Orde r 2001-9-16 , p . 4

.

### 2

. Thi s authorit y shall b e effective unti l 9 0 day s afte r the Departmen

t issue s it s fina

l orde r on the join t

applicatio n o

f Centurio n Ai

r Cargo , Inc. , Sk

y Leas e I , Inc. , an

dArrow Air , Inc. , in Docke

t DOT-OST-2010-025 8 fo

r approva l o f atransfe r o f rout e authorit y unde r sectio n 4110 5 o

f th e Statute

. 3

. W e ma y amend , modify , o

r revok e thi s orde r a t an y tim e an dwithout hearing

. 4

. W e will serv e acopy o

f thi s orde r on the person s liste di

n Attachmen

t A

. By :

SUSA N L

. KURLAN

D Assistan t Secretar y fo r Aviatio n an

dInternationa

l Affair s

A n electroni c version o f

thi s documen

t i s availabl e o

n the Worl dWid e We b a t http://www

. regulations , go

vAttachmen t A


### SERVIC E LIS T FO R CENTURIO N AI R CARGO , INC. , SK Y LEAS E I , INC. , AN D ARROW AIR , INC

.

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