U.S. Deportment of Transportation Office of the Secretory ofTransportation

Mr. Joseph R. Hicks Tcmsco Helicopters, Inc. P.O. Box 5057 Ketchikan, Alaska 99901-0057
Dear Mr. Hicks: Assistant Secretary**~larch** 19, 20l2**~200** New Jersey**A~cnue.** SE Wash• ngton

. DC 20590

Thank you for your letter concerning the U.S. Department ofTransportation's (Department) citizenship investigation ofVlH Cougar Helicopters, Inc. (VIH Cougar).
On March 12, 2012, the Department issued Order 2012-3-7 tentatively finding that VIH Cougar is not a U.S. citizen as defined in 49 U.S.C. 

### §40102(a)(15) and proposing to cancel its air taxi authority. Interested parties are provided 21 days from the date ofits issuance to file objections to the Department's tentative findings. Access to the docket is available by entering the docket number, DOT-OST-2012-0022, into the simple search llmction at the Department's Docket**~v1anagement** System (DMS) website, which is http://www.regulations.gov. Finally, since this matter is pending, I am unable to commenton the merits ofVIH Cougar's submissions. I assure you. however, that the Department will give full consideration to all comments on the record in the docket. i\s is our normal practice. Iam placing a copy ofyour letter and this response in Docket DOT-OST-2012-0022 as a contact outside the record ofthis matter. I appreciate your interest in this proceeding. Sincerely yours,**·**

# \ll(,J:_~**)** 1/ Susan L. Kurland 

### Assistant Secretaryfor Aviation and International Affairs



### . X1-120316-001**~**Ms. Susan Kurland Assistant Secretary ofTransportation for Aviation & International Affairs United States Department ofTransportation 1200 New JerseyAvenue; SE Washington, DC 20590 KETCHIKAN: FAX: PETERSBURG: SKAGWAY: JUNEAU:

Via email to susan.kurland@dot.gov; susan.l.kurland@dot.gov; faac@dot.gov (907)225-5141 (907) 225-2340 (907)n2-4780 (907) 983-2909 (907)789-9501

SUBJECT: VIH Cougar Helicopters, Inc. 

### I Foreign Operators Competing with Americans Dear Secretary Kurland: Petroleum Helicopters, Inc (PHI) challenged the operations ofVIH Cougar Helicopters, Inc. (VIH Cougar) in the United States (Alaska, the West Coast, and the Gulf of Mexico). As a certificated air carrier I concurwith the sentiments expressed in this letter. In your October 6, 2011 letterto counsel for VIH Cougar Helicopters, Inc, (VIH Cougar) concerning their status as a Part298 AirTaxi Operator you cited "overwhelming evidence" thatVIH Cougar is not in compliance with the requirements ofthe Federal Aviation Actthat certificated airline operators be citizens ofthe United States. US air carriers have long maintained and you finally concluded that although VIH Cougartheoretically complies with the numerical ownership requirements ofthe statute, it is not under the actual control ofcitizens ofthe United States. You note four reasons, including: • the agency relationship of Mr. Steeper by Mr. Nourie, • the provision oftechnical and operational services and equipment by the VIH Group to VIH Cougar, • contractual relationships among the VIH Group and VIH Cougar, and, • tellingly, information discrepancies provided to the Department. Additionally, VIH Cougar officials have made public statements revealing that company's Canadian ties. Each one ofthese alone would be grounds for a finding on non-compliance, but together they show a premeditated and willful lack of compliance disposition as well as non-citizenship. During the entire period ofthis investigation VIH Cougar has continued to compete unfairlywith U.S certificated operators. VIH Cougar has been the beneficiary of its illegal relationship with the VIH Group at the expense of U

.S

. companies

. Since October 6, 2011, VIH has continued to do business without any apparent change

. If anything, it is now incentivized to seek additional market share as part ofwhatever restructuring it may offer to the Department. While US certificated operators appreciates the Department's very thorough review ofthe allegations against VIH Cougar, we believe that the time has come to stop VIH Cougar's, and otherforeign entities, lengthy history offlaunting the citizenship requirements and competing unfairly against U.S. citizen operators. As the VIH Group remains in control ofVIH Cougar almostthree months after the 30-day deadline for compliance included in your October 6, 2011 letter, we respectfully

### requestthat immediate action be taken to bring an end to this illegal situation. We urge the Departmentto move quickly and openly to end this situation, which has gone on for several years. VIH Cougarshould not be allowed to continue to engage in unlawful competition that disadvantages U.S. citizen operators as it delays compliance with U.S. lawto maximize its ill-gotten gains. VIH Cougar should not be allowed to continue to operate in the United States unless it has metthe requirements ofthe Federal Aviation Act that certificated airline operators be citizens ofthe United States. The Department's recent Notice of Proposed Policy Clarification forthe Registration of Aircraftto U.S. Citizen Trustees in Situations Involving Non-U.S. Citizen Trustors and Beneficiaries, Federal Register Feb 9, 2012 indicates the serious concern the Department is showing with regard to assuring close regulatory oversightof U.S. registered aircraftand operations. Likewise, in this matter, the operator has persistently evaded statutory requirements for actual citizen control. Justas the Department is taking action to assure that regulatory oversighton leased US registered aircraft is notavoided through complex ownership instruments, the Department should move to quickly close down VIH Cougar's evasion ofthe statute. We believe that there is no public policy that can be served any longer by shielding VIH Cougar's citizenship status from the public. Having made the preliminary findings based on "overwhelming evidence," we respectfully requestthatthe Department bring transparency to anyfurther proceedings in this matter. The Department's informal proceedings may have public policy benefits in enabling operators to arrange their citizenship affairs privately when they are seeking to comply with the law, but that does not apply in this case. Here, VIH Cougar circumvented the law in a calculated manner and did not merely seek to ascertain the limits ofthe citizenship requirements. Instead, it established, and long operated under, an egregious scheme which violated the citizenship requirements and engaged in deception to do so. As U.S. citizens, we are entitled to transparency and open government in matters of regulatory compliance. Any efforts bythe Departmentto ensure thatVIH Cougar divests and restructures should be open, transparent and public. Sincerely, Joseph R. 

### Hicks Sr. Vice President TEMSCO Helicopters Inc. Cc: Ray LaHood, Secretary ofTransportation via email to robert.letteney@dot.gov Representative Don Young, via email to scott.leathard@mail.house.gov Senator Lisa Murkowski, via email to warren.wright@murkowski.senate.gov Senator Mark Begich, via email to james feldman@begich.senate.gov Governor Sean Parnell, via email to randall.ruaro@alaska.gov; russ.kelly@alaska.gov