BEFORE THE

DEPARTMENT OF TRANSPORTATION

WASHINGTON, D.C.

Application of

NORWEGIAN AIR INTERNATIONAL LIMITED

for an exempti on under 49 U.S.C. § 40109 and

a foreign air carrier permit pursuant to

49 U.S.C. § 41301 (U

. S

. - EU Open Skies) )

)

)

)

)

)

)

) Docket DOT

- OST

- 201 3

- 0 204

JOINT ANSWER OF DELTA AIR LINES, INC ., UNITED AIRLINES, INC., and

AMERICAN AIRLINES, INC

.

Communications with respect to this document should be addressed to:Howard Kass Vice President

-- Regulatory Affairs American Airlines

, Inc. 1401 H Street, NW Washington, DC 20005 202

- 326

- 5153 Howard.Kass@ aa.com

Robert A. Wirick Managing Director, Regulatory and International Affairs American Airlines

, Inc. P.O. Box 619616, MD 5635 DFW Airport, Texas 75161 (817) 963

- 0394 robert.wirick@aa.com

Daniel A. Weiss Managing Director

– I nternational Affairs and Regulatory U NITED AIRLINES, INC. 233 South Wacker Drive 10th Floor

– HDQIZ Chicago, IL 60606 (872) 825

- 6828 dan.weiss@united.com Alexander Van der Bellen Managing Director

– Regulatory and International Affairs & Associate General Counsel Christopher Walker, Regional Director

– Regulatory and International Affairs DELTA AIR LINES, INC. 1212 New York Avenue, N.W. Washington, D.C. 20005 (202) 842

- 4184 sascha.vanderbellen@delta.com

August 18 , 2014BEFORE THE

DEPARTMENT OF TRANSPORTATION

WASHINGTON, D.C.

Application of

NORWEGIAN AIR INTERNATIONAL LIMITED

for an exempti on under 49 U.S.C. § 40109 and

a foreign air carrier permit pursuant to

49 U.S.C. § 41301 (U

. S

. - EU Open Skies) )

)

)

)

)

)

)

) Docket DOT

- OST

- 2013

- 0 204

JOINT ANSWER OF DELTA AIR LINES, INC., UNITED AIRLINES, INC., and AMERICAN AIRLINES
, INC.

Delta, United, and American (the “Joint Carriers”) appreciate this opportunity to reply to
the Notice that the Department filed on August 4 summarizing the EU Commission ’s views on the application of Article 17 bis of the U.S.

- EU Air Services Agreement to foreign carrier applications for operating authority

. Consistent with the Department’s admonition, we conf ine
our comments to the information contained in the Notice and incorporate here by reference the facts and arguments we have already advanced

.

The Joint Carriers believe that no new information was developed in the Notice that
would support the approval of NAI’s application. The essence of the Commission ’s position is
that Article 17 bis does not provide a basis for the Department to unilaterally deny NAI’s application

. This argument ignores the salutary objective of Article 17 bis

, which is to maintain high labor a n d social standards in the transatlantic market

, and to prohibit the establishment of flags of convenience that seek to evade labor protections and create an unfair competitive advantage. It also ignores the independent public inte rest standard that the Department must apply to certification requests

.Norwegian Joint Rep ly Page 2

The U

. S

. - EU agreement specifically acknowledged that the Department was not ceding
its authority to conduct its critical public interest review of airli ne certification requirements. As stated in paragraph 5 of the 2010 Memorandum of Consultations:

The delegations affirmed that the procedures for reciprocal recognition of regulatory
determ inations with regard to airline fitness and citizenship in the new Article 6 bis are not intended to modify the conditions prescribed under the laws and regulations normally applied by the Parties to the operation of international air transportation referred to in Article 4 of the Agreement.

Furthermore, under Article 4, “the airlin e [must be] qualified to meet the conditions prescribed under the laws and regulations normally applied to the operation of international air transportation by the Party considering the application . . .” To be sure, the Department is obligated to recogni ze regulatory determinations of the other Party and act promptly on applications for certification approval. But, it is not a “rubber stamp.” Here, where there are legitimate reasons for concern, the U

. S

. - EU agreement provides for appropriate consultatio n processes. We note that one of the Department’s guiding policy principles under 49 USC 40101 is to “encourag[e] fair wages and working conditions. ” The Department is also directed by statute to strengthen “the competitive position of [U.S.] air carrier s to at least ensure equality with foreign air carriers.” 49 U.S.C. §§ 40101(a)(15) and (e)(1). Clearly these policy mandate s

are called into question by NAI’s unique and unprecedented attempt to evade the labor laws of Norway in order to achieve a compet itive advantage in the marketplace.

NAI has filed for both Permit and Exemption relief. The Department should deny NAI an exemption, which is a discretionary and special process available to expedite consideration under appropriate circumstances when the application is clearly in the public interest

. 49 U.S.C. § 40109. The denial would be without prejudice to later consideration of NAI’s permit application after sufficient fact s are established and made available and time allotted for careful
considerati on from all Parties of this novel permit application. The need for exemption relief is further mitigated given that Norwegian is already operating to the United States via Norwegian Air Shuttle entity using 787s operated by its subsidiary Norwegian Long h aul and leased B

777s

.
With respect to Article 17 bis , its core objectives would be fatally undermined if the Department approved the NAI application. It would allow NAI to enter the U.S.

- EU market by establishing a de facto flag of convenience specifically designed to circumvent Norway’s labor protection laws. It would also allow NAI to import lower cost labor from outside the U.S and EU which would be deployed to compete directly

, and in our view, unfairly i n the transatlantic marketplace with U.S. and EU carriers that are subject to

- and follow

- stringent labor standards.

The Department's summary note s that the U.S. Government requested the meeting with the Commission and in particular that Secretary Foxx sought the meeting in order to understand
the views of DG MOVE on Article 17 of the Ag reement. The summary also notes that Director Baldwin stated at the outset of the meeting that he was speaking only for officials of DG M OVE and not for all the parties to the Agreement. Under th ese circumstances, it is clear that theNorwegian Joint Rep ly Page 3

views obtained during the meeting with DG M OVE represent the position of DG M OVE only. To the extent that the views of the EU are relevant to decisions of the Department regarding the application of NAI, it would be necessary to understand the views of t he remaining 34 parties to
the A greement before drawing any conclusions regarding the EU's position on Article 17 bis

.
For the foregoing reasons and for reasons set out in the Joint Carriers’ earlier filing, the Dep artment should deny the NAI application.

Respectfully submitted,

/s/ Alexander Van der Bellen Managing Director, Regulatory and International Affairs

& Associate General Counsel Delta Air Lines, Inc.

/s/ Howard Kass Vice President

-- Regulatory Affairs American Airlines

, Inc.

/s/ Robert A. Wirick Managing Director, Regulatory and International Affairs American Airlines, Inc.

/s/ Dan Weiss Managing Director

– International Affairs and Regulatory United Airlines, Inc.C ERTIFICATE OF SERVICE

A copy of the foregoing Answer has been ser ved this 18 th day of August

, 2014 , upon the following persons via email:

romanow@pillsburylaw.com peter.nelson@pillsburylaw.com Russell.Bailey@alpa.org steve.morrissey@united.com dan.weiss@united.com sascha.vanderbellen@delta.com howard.kass@usairways.com robert.wirick@aa.com francis.heil@aa.com rpommer@atlasair.com mlbenge@zsrlaw.com jesse.elliot@faa.gov douglas.schwab@faa.gov nic holas.tsokris@faa.gov john.allen@faa.gov anita.mosner@hklaw.com jennifer.nowak@hklaw.com nssparks@fedex.com dberg@airlines.org jcasey@airlines.org paul.gretch@dot.gov brian.hedberg@dot.gov esta.rosenberg@dot.gov brett.kruger@dot.gov urskr@state.gov CristinaSA@state.gov eugene_alford@ita.doc.gov info@airlineinfo.com