UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY WASHINGTON, DC



### Issued by the Department of Transportation on February 11 , 2014

NOTICE OF ACTION TAKEN

-- DOCKET DOT

- OST

- 2014

- 0014

_________________________________________________________________________________________________________ ____ __________________ _____ ___ This serves as notice to the public of the action described below, taken by the Department official indicated (no additi onal confirming order will be issued in this matter).

Application of SOUTHERN AIR INC. (S OUTHERN) filed 1 / 30/14 for:

XX St atement of authorization under 14 C.F.R. Part 212 to engage in the following code

- share service :

Southern requests a blanket statement of authorization allowing Southern to display China Cargo Airlines Ltd.’s (China Cargo) designator code, CK, on scheduled all

- cargo flights operated by Southern between the United States

and China. 1

XX Waiver of the 45

- day advance fi ling r equirement under 14 CFR Part 212

.

Applicant rep resentative : Aaron A

. Georlich (202) 776

- 3974

DOT Analyst: Darren Jaffe (202) 366

- 2512

D I S P O S I T I O N

XX Approved request of Southern for a blanket statement of authorization

, subject to conditions (specifically including the conditi on concerning coterminalization; S ee remarks below )

.

XX Approved waiver of 45

- day advance filing requirement under 14 CFR Part 212.

The above action approving the statement of authorization was effective when taken: February 11 , 201 4

, and will remain in effect indefinitely, subject to the conditions listed below.

The above action granting a waiver of the advance filing requirement under 14 CFR Part 212 is effective: February 11

, 2014

.

Action taken by: Paul L. Gretch, Director

Office of International Aviation

XX The authority granted is consistent with the Air Transport Agreement, as amended , between the United States and the People’s Republic of China.

Except to the extent exempted or waived, this authority is subject to the terms, conditions, and limitations indicated:

XX Conditions for Statement of Authorization (attached as Appendix A)

XX Southern’s U.S.

- China all

- cargo exemption authority dated December 3, 2013 ( see Notice of Action

Taken in Docket DOT

- OST

- 2010

- 0157)

XX China Cargo’s foreign air carrier permit authorizing all

- cargo U.S.

- China service dated July 16, 2003 ( see Order 2003

- 7

- 21 in Docket DOT

- OST

- 2002

- 12080 )

1 The code

- share agreement submitted by Southern states that Southern will carry China Cargo’s “CK” designator code on all

- cargo Chicago

- Anchorage

- Zhengzhou and Zhengzhou

- Shanghai

- Anchorage

- Chicago routings

, scheduled to begin service on February 13,

2014

, three times per week using Southern’s B747

- 400 aircraft. While the code

- share agreement onl y covers the two routings listed above, we are granting the broad U.S.

- China code

- share authority requested by Southern in its application.

### ______________________________________________________________________________________ Remarks: While we will permit the display of the “CK” designator code between China and the United States , we are not prepared at this time to permit Southern to display the “CK” designator code between U.S. points . We have taken similar action limiting new coterm inalization of U.S . points for all

- cargo services by other carriers of the People’s Republic of China for the reasons first set forth in a Notice of Action Taken dated April 15, 2010 in Docket

DOT

- OST

- 2010

- 0047

. See

, e.g

. , Notice of Action Taken dated Octo ber 11, 2011, in Dockets DOT

- OST

- 1997

- 2653,

DOT

- OST

- 1999

- 5031, DOT

- OST

- 2001

- 9314, and DOT

- OST

- 2001

- 10172 (China Southern); and Notices of Action Taken dated January 21, 2011, and October 20, 2010, in Dockets DOT

- OST

- 2006

- 24629 and DOT

- OST

- 2006

- 24630 (Yangt ze). Our action here does not preclude the exercise of the Alaska co

- terminalization authority granted by Notice of Action Taken dated August 16, 2012, in Dockets DOT

- OST

- 2010

- 0200, DOT

- OST

- 1999

- 5035, and DOT

OST

- 1996

- 1600.

____________________________________________________________________________________ Under author i ty assigned by the Department in its regulations, 14 CFR Part 385, we found th at (1) our action was

c o nsistent with Department policy; (2) g ra n t of the au th ori t y was consistent with the public interest; and (3) grant of th e authori t y w ould not con s titute a major regulato r y action under the Energy Policy and C onservation Act of 1975. To the

extent not granted, we denied all requests in the referenced Docket s

. We may amend, m odif y
, or r e voke the aut h ori t y granted in this Notice at any ti m e without hear i ng at our discretion.

Persons entitled to petition the Department for review of the action set forth in this Notice under the Depar t ment’s regulations, 14 CFR §385.30, m ay file t h eir petitions wit h in seven (7) d a y s after the date of issuance of this Notice. This

action was effective w h en taken, and t h e filing of a petition for r e view will not alter such effectivene ss

.

An electronic version of this document is available on the World Wide Web at: http://www.regulations.gov

### APPENDIX A

The statement of authorization granted is subject to the following conditions:

(a) The statement of authorization will remain in effect only as long as (i) Southern and China Cargo continue to hold the necessary underlying authority to operate the code

- share services at issue, and (ii) the code

- share agreement providing

for the code

- share operations remains in effect.

(b) Southern and China Cargo must promptly notify the Depar tment (Office of International Aviation) if the code

- share agreement providing for the code

- share operations is no longer effective or if the carriers decide to cease operating all or a portion of the approved code

- share services. Such notices should be f iled in Docket OST

- 2014

- 0014

. 2

(c) Southern and/or China Cargo must notify the Department no later than 30 days before they begin any new code

- share

service under the code

- share services authorized here. Such notice shall identify the market(s) to be served, which carrier will be operating the aircraft in the code

- s hare market added, and the date on which the service will begin. Such

notices should be filed in Docket OST

- 2014

- 0014

.

(d) The code

- sharing operations conducted under this authority must comply with 14 CFR §257 and with any amendment to the Department’s regulations concerning codeshare arrangements that may be adopted. Notwithstanding any provisions in the contract between the carriers, our approval here is expressly conditioned upon the requirements that the subject foreign air transportation be sold i n the name of the carrier holding out such service in computer reservation systems and elsewhere; that the carrier selling such transportation (i.e., the carrier shown on the waybill) accept responsibility for the entirety of the codeshare journey for all obligations established in its contract of carriage with the shipper; and that the cargo liability of the operating carrier be unaffected.

(e) Any service provided shall be consistent with all applicable agreements between the United States and China , and all applicable agreements with other foreign countries involved. Furthermore, (i) nothing in the award of this blanket statement of authorization should be construed as conferring upon Southern rights (including code

- share, fifth

- freedom

intermediate and /or beyond rights) to serve markets where U.S. carrier rights are limited unless Southern notifies us of its intent to serve such market and unless and until the Department has completed any necessary carrier selection procedures to determine which carrier (s) should be authorized to exercise such rights; 3 and (ii) should there be a request by any carrier to use the limited

- entry route rights that are included in Southern’s authority by virtue of the blanket statement of authorization granted here, but that are not being used by Southern , the holding of such authority will not be considered as providing any preference for Southern in a carrier selection proceeding to determine which carrier(s) should be entitled to use the authority at issue.

(f) The authority granted here is specifically conditioned so that neither Southern nor China Cargo shall give any force or effect to any contractual provisions between themselves that are contrary to these conditions.

(g) We may amend, modify, or revoke the authority granted at any time without hearing a t our discretion.

2 We expect this notification to be received within 10 days of such non

- effectiveness or of such decision.

3 The not ice referenced in condition (c) above may be used for this notification.