## u.s. Department of Transportation Office of the Secretory ofTransportation


### Mr. Stephen 

### J. Kapper Security Aviation 6121 South Airpark Place Anchorage, Alaska 99502 Dear Mr. Kapper: Assistant Seeretarv

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J:.farch 19, 2012



### Thank you for your letter concerning the U.S. Department ofTransportation's (Department) citizenship investigation ofVIH Cougar Helicopters. Inc. (VtH Cougar). On March 12, 2012, the Department issued Order20**12-3~**

### 7 tentatively finding that VIH Cougar is not aU.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 function at the Department's Docket Management System (OMS) website, which is http://www.regulations.gov. Finally, since this matter is pending, 1run unableto comment on 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. As is our nonnal practice, Iam placing a copy ofyour letter and this response in Docket DOT-OST-2012-0022 as a contact outside the record ofthis n1atter. I appreciate your interest in tllis proceeding. Sincerely yow·s,

Susan L. Kurland 

### Assistant Secretary for Aviation and International Affairs

# SECURITY !JI;'AVIATION

6121 South Airpark Place • Anchorage, Alaska 99502 • (907) 248-2677 • Fax (907) 248-6911 www.securityaviation.biz email: accounting@securityaviation.biz Ms. SusanKurland Assistant Secretary ofTransportation for Aviation & International Affairs United States Department ofTransportation 1200 New Jersey Avenue, SE Washington, DC 20590 Via email to susan.kurland@dot.gov; susan.l.kurland@dot.gov; faac@dot.gov SUBJECT: VIH Cougar Helicopters, Inc. I Foreign Operators Competingwith Americans Dear Secretary Kurland: Petroleum Helicopters, Inc (PHI) challenged the operations ofVIH Cougar Helicopters, Inc. (VIH Cougar) inthe United States (Alaska, the West Coast, and the GulfofMexico). As a certificated air carrier I concurwiththe sentiments expressed in this letter. Inyour October 6, 201lletterto counsel for VIH Cougar Helicopters, Inc, (VIH Cougar) concerning their status as aPart298 AirTaxi Operator you cited "overwhelming evidence" thatVIH Cougar is not in compliancewith the requirements ofthe Federal Aviation Act that ·certificated airline operators be citizens ofthe United States. US air carriers have long maintained and you fmally concluded that although VIH Cougar theoretically complies with the numerical ownership requirements ofthe statute, it is not underthe actual control ofcitizens ofthe United States. You note four reasons, including: • the agency relationship of

### Mr. Steeperby 

### 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 togetherthey show a premeditated and willful lack ofcompliance disposition as well as noncitizenship. During the entire period ofthis investigation VIH Cougarhas continued to compete unfairly with U.S certificated operators. VIH Cougarhas been the beneficiary ofits illegal relationship with the VIH Group at the expense ofU.S. companies. Since October 6, 2011, VIH has continued to do business without any apparent change. Ifanything, it is now incentivized to seek additional market share as part ofwhatever restructuring it may offerto 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 other foreign entities, lengthy history offlaunting the citizenship requirements and competing unfairly againstU.S. citizen operators. As the VIH Group remains in control ofVIH Cougar almost

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.**~**three months after the30-daydeadline for compliance included inyour October6, 201lletter, we respectfully request that 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 Cougar should not be allowed to continue to engage in unlawful

.competition that disadvantages U.S. citizen operators as itdelays compliance with U.S.Iaw to

. maximize its ill-gotten gains. VIH Cougar should not be allowed to continue to operate in the

United States unless it has met the requirements ofthe Federal Aviation Act that certificated airline operators be citizens ofthe United States. The Department's recent Notice ofProposed Policy Clarification for the Registration of

· Aircraft to 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 oversight ofU.S. registered aircraft and .operations. Likewise, in this matter, the operatorhas persistently evaded statutory requirements for actual citizen control. Just as the Departmentis taking action to assure that regulatory oversight on leased US registered aircraftis not avoided 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 request thatthe Departmentbring transparency to any further

· 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 Department to ensure thatVIH Cougar divests and

·restructures should be open, transparent and public. 

# 4Iy

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. Stepb.J.Kapper President/CEO Security Aviation Cc:· Ray LaHood, Secretary ofTransportation viaemail 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 SenatorMark Begich, via email to james feldman@begich.senate.gov Governor Sean Parnell, via email to randall.ruaro@alaska.gov; russ.kelly@alaska.gov 

### SECURITY AVIATION 6121 South Airpark Place Anchorage, Alaska 99502 (907) 248-2677 I Alaska Only (800) 478-7880 I FAX (907) 248-6911