UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation on November 15 , 20 1 2



### NOTICE OF ACTION TAKEN

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___________________________________________ _____________________________________________________ ________ This serves as notice to the public of the action described below, taken by the Department official indicated (no additional confirming order will be issued in this matter).

Applicant : CEBU AI R, INC. d/b/a CEBU PACIFIC AIR ( Cebu ) Date Filed: October 17

, 2 0 1 2

Relief requested: E xemption from 49 USC § 4 1301 to engage in (i) scheduled foreign air transportation of persons, property and mail from the Philippines via intermediate poin ts to Honolulu, San Francisco, Los Angeles, Guam, Saipan, and four additional points in the United States selected by the Philippines, and beyond to five countries selected by the Philippines; and ( ii ) charter foreign air transportation in accordance with the requirements of 14 C.F.R.

Part 212 . The applicant proposes to conduct its services pursuant to a wet lease arrangement with a duly authorized and properly supervised U.S. or foreign air carrier.

Applicant representative: Charles F. Donley II

, (202) 626

- 6840 DOT ana lyst: Brett D. Kruger ( 202 ) 366

- 8025

Responsive pleadings: None.

DISPOSITION

Action: Approved. Action date: November 15 , 20 1 2

Eff ective dates of authority granted: November 15 , 20 1 2 , through November 15 , 20 1 3

.

Basis for approval (bil ateral agreement/reciprocity): U.S.

- Philippines Air Transport Agreement

.

Except to the extent exempted/waived, this authority is subject to the terms, conditions, and limitations of our standard exemption conditions (attached).

Special conditions/Remarks: We found that Cebu is financially and operationally qualified to conduct i t s proposed

services and that it is substantially owned and effectively c ontrolled by citizens of its claimed homeland. 1 We also note

that the applicant is properly licensed by its homeland to perform the proposed services.

Cebu may conduct the operations authorized here only by using aircraft wet

- leased from a duly authorize d and properly supervised U.S. or foreign air carrier. Cebu may not conduct U.S. operations with its own aircraft and crews without further action by the Department. 2

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 ith Department policy; (2) the app licant was qualified to perform its proposed operations; (3) grant of the authority was consistent with the public interest; and (4) grant of the authority would not constitute a major regulatory action under the Energy Policy an d

1 Cebu states that 66.15% of its shares are owned by CPAir Holdings, Inc., a Filipino company that is a wholly owned subsidiary of JG Summit Holdings, Inc. In turn, 93.1% of the shares of JG Summits Holdings, Inc. are held by citizens of the P h ilippines. Of the remaining 33.85% of Cebu ’s shares, 10.22% are ultim ately held by citizens of the Philippines and 23.63% are held by non

Filipino interests, none of which hold a 5% or more share. Cebu further states that its Chairman of the Board of Directors and seven of the eight remaining Board Members are citizens of the Philippines , with one a citizen of Singapore . Cebu also states that

all of its k ey management personnel are citizens of the Philippines.

2 The Philippines is currently a Category 2 country under the FAA’s International Aviation Safety Assessment Progr am.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 entitled to petition the Departme nt 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 when taken, and the filing of a pe tition 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

### Foreign Carrier Exemption Conditions

In the cond uct 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 Dep artment;

(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 I IR of its plans and to find out whether t he 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, insuranc e 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 compete ncy 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 limi ts 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

i n 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 wh ich 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 transporta tion" 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, origina te 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 other wise 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 a s 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 compli ance 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.

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