UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation on June 13

, 20 1 4



### N OTICE OF ACTION TAKEN

– DOCKET S DOT

- O ST

- 20 1 4

- 0 0 66

______________________________________________ __________________________________________________________________________________ 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).

Joint Applicant s : US AIRWAYS, INC., (US A irways ), PIEDMONT AIRLINES , Inc. (P iedmont ), PSA AIRLINES

, Inc. (PSA)

, FINNAIR OYJ ( Finnair ), and FLYBE FINLAND OY ( Flybe Finland ) 1

Date Filed: April 29 , 201 4

Relief requested: Amendment of e xemption u nder 49 USC §40109 to permit Flybe Finland to engage in code

- share operations under which Flybe Finland would display both the “AA” designator code of American and the “US” designator code of US Airways on flights Flybe Finland operates to points within th e European Union (EU) and European Common Aviation Area (ECAA), as well as to points beyond the EU and ECAA countries. 2

The joint applicants also request statements of authorization under 14 CFR Part 212, as follows:

A. Blanket statements of authorization under 14 CFR Part 212 to permit US Airways and PSA to display the Finnair

“ AY ” designator code on flights operated by US Airways and PSA (i) between any point or points in the United States and any point or points in the EU (either non

- stop or via third co untry intermediate points); (ii) between any point or points in the EU and any point or points in third countries; (iii) between U.S. points; and (iv) between any point or points in the U.S. and any point or points in third countries

.

B. Blanket statement o f authorization under 14 CFR Part 212 to permit Piedmont to display the Finnair “ AY ” designator code on flights Piedmont operates between points in the United States

.

C. Blanket statement of authorization under 14 CFR Part 212 to permit Finnair to display t he US Airways “ US ” designator code on flights operated by Finnair (i) between any point or points in the United States and any point or points in the EU (either non

- stop or via third country intermediate points); (ii) between any point or points in

the Uni ted States and any point or points in third countries; (iii) between EU points; and (iv) between any point or points in the EU and any point or points in third countries

.

D. Blanket statement of authorization under 14 CFR Part 212 to permit Flybe Finland to display the US Airways “US” designator code on flights operated by F lybe Finland (i) between EU points; and (i i ) between any point or points in the EU and any point or points in third countries.

The Joint Applicants further request a waiver of the 45

- day advance filing requirement under 14 CFR Part 212.

1 The joint applicants state that, following the merger of US Airways and American Airlines, Inc. (American) on December 9, 2013,

US Airways qualifies as an affiliate of American

, and US Airways and American have elected to include US Airways and its affiliates (Piedmont and PSA) in the existing code

- share arrangement between American and Finnair and its affiliate ( Flybe Finland )

. See Department action dated January 7, 2000, in Docket DOT

- OST

- 1999

- 6544 for the American

- Finnair code

- share approval. The joint applicants request blanket statements of authorization and related exemption authority to the extent necessary to permit thei r exp anded

code

- share operations.

2 We note that US Airways, Piedmont, PSA, and Finnair all hold the necessary underlying economic authority to conduct the services proposed here and require only statements of authorization

. Flybe Finland currently holds exe mption authority and a statement of authorization that enable it to display the “AA” designator code of American on certain flights operated by Flybe Finland. See Notice of Action Taken dated April 23, 2013, in Docket DOT

- OST

- 2013

- 0078. The instant Flybe Finland exemption amend ment and new

statement of authorization would add US Airways in light of the American

- US Airways merger. We note that Flybe Finland does not

opera te flights to the United States; nor does it place its designator code on American an d U.S. Airways’ flights to the United States.Applicant representative s : Howard Kass

, Abigail Donovan , 202

- 326

- 5153

, and Robert A. Wirick, 817

- 963

- 0394 (US Airways ), Anita M. Mosner and J ennifer Nowak , 202

- 419

- 2604 ( Finnair ) , & Evelyn D. Sahr and Dr ew M. Derco, 202

- 659

- 6622 (Flybe Finland)

DOT analyst: David R. Christofano , 202

- 366

- 0584

Responsive pleadings: None

DISPOSITION

Action: Approved

, subject to conditions Action date: June 13

, 20 1 4

Effective dates of authority granted: Flybe Finland ’ s amended e xemption authority is effective from June 13 , 20 1 4

, through June 13 , 2016

.

The statement s of authorization granted to the joint applicants are effective June 13 , 20 1 4 , and will remain in effect for an

indefinite duration , subject to conditions

.

Our action granting the joint applicants’ request for waiver of the 45

- day advance filing requirement under 14 CFR Part

212 is effective June 13 , 2014.

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

- EU Air Transport Agreement.

Except to the extent exempted/waive d , this authority is subject to the terms, conditions, and limitations of our standard foreign air carrier exemption conditions attached as Appendix A and code

- share conditions attached as Appendix B

.
Special conditions /Remarks: We note that US Airways ha s conducted safety audit s of Finnair and Flybe Finland under the Department’s Code

- Share Safety Audit Program, and the FAA has advised us that it has reviewed the relevant audit

report s and found them to be acceptable.

Action taken by: Paul L. Gretch, Director Office of International Aviation

_________________________________________________________ ___________________________________________________ Under authority assigned by the Department in its regulations, 14 C FR Part 385, we found that (1) our action was consistent with Department policy; (2) the applicant s were qualified to perform their proposed operations; (3) grant of the authority was consistent with the public interest; and (4) grant of the authority woul d not constitute a major regulatory action under the Energy Policy and Conservation Act of 1975. To the extent not granted, we denied all requests in the referenced Docket s . 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 Department for review of the action set forth in this Notice under the Department’s regulati ons, 14 CFR §385.30, may file their petitions within seven (7) days after the date of issuance of this Notice. This action was effective when taken, and the filing of a petition for review will not alter such effectiveness.

An electronic version of this document is available on the World Wide Web at:

htt

p://www.regulations.govAppendix A



### F oreign Air Carrier Exemption Conditions

In the conduct of the operations authorized, each foreign carrier applicant shall:



### (1) Not conduct any operations unless it holds a currently effective authorization from its homel and for such operations, and it has filed a copy of such authorization with the Department;

(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 Principa l Security Inspector) to advise the IIR of its plans and to find out whether the 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 cove rage 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

26 0), Flight Standards Service (any changes to, or termination of, insurance 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 Chica go Convention;

(5) Conform to the airworthiness and airman competency 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 limits 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 i nstituted against it in any court or other tribunal in 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, poin t of destination, or agreed stopping place, or for which 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 th is condition, the term "international air transportation" 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 spe cifically authorized by the Department, originate or terminate all flights to/from the United States in a Member State of the European Union;

(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 otherwise 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 te rms, conditions, and limitations required by the public interest as 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 n ot be effective during any period when the holder is not in compliance 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.

EU carrier 01 /2008Appendix B

The code

- share operations authorized here are subject to the following conditions:

(a) The statement s of authorization will remain in effect only as long as (i) American , US Airways, Piedmont, PSA,

Finnair

, and Flybe Finland 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) American , US Airways, Piedmont, PSA

, Finnair , and /or Flybe Finland must promptly notify the Department (Office of International Aviation) if the c ode

- 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

filed in Docket DOT

- OST

- 2014

- 00 66

. 1

(c) American, US Airways, Piedmont, PSA, Finnair , and /or Flybe Finland 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

- share market added, and the date on which the service will begin. Such notices should be filed in Docket DOT

- OST

- 2014

- 00 66. 2

(d) The code

- sharing operations conducted under this authority must comply with 14 CFR 257 and with any amendments to the Department’s regulations concerning code

- share arrangements that may be adopted. Notwithstanding any provisions in the contract betw een the carriers, our approval here is expressly conditioned upon the requirements that the subject foreign air transportation be sold in the name of the carrier holding out such service in the computer reservation systems and elsewhere; that the carrier s elling such transportation ( i.e., the carrier shown on the ticket) accept responsibility for the entirety of the code

- share journey for all obligations established in its contract of carriage with the passenger; that the passenger liability of the operatin g carrier be unaffected; and that the operating carrier shall not permit the code of its U.S. code

- sharing partner to be carried on any flight that enters, departs, or transits the airspace of any area for whose airspace the Federal Aviation Administration has issued a flight prohibition.

(e) Any service provided shall be consistent with the provisions of the U.S.

- EU agreement, and all applicable agreements with other foreign countries involved. Furthermore, (i) nothing in the award of the blanket stateme nt s of authorization should be construed as conferring upon American

, US Airways , Piedmont, or PSA rights (including code

- share, fifth

freedom intermediate and/or beyond rights) to serve markets where U.S. carrier rights are limited unless American, US

Air ways, Piedmont, and PSA notifies us of their 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) shou ld there be a request by any carrier to use the limited

- entry route rights that are included in the authority of American, US Airways, Piedmont, or PSA by virtue of the blanket statement s of authorization granted here, but that are not being used by Americ an, US Airways, Piedmont, or PSA , the holding of such authority will not be considered as providing any preference for American, US Airways, Piedmont, or PSA in a carrier selection proceeding to determine which carrier(s) should be entitled to use the auth ority at issue;

(f) The authority granted here is specifically conditioned so that neither American, US Airways, Piedmont, PSA nor Finnair and Flybe Finland shall give any force or effect to any contractual provisions between themselves that are
contrary to these conditions.

We may amend, modify, or revoke the authority granted at any time without hearing at our discretion

.

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

- effectiveness or of such decision.

2 The joint applicants provided notice of their intent to engage in in reciprocal codeshare services i ) between points in the United

States and points in the EU (both nonstop and intermediate routings via open skies points); ii) between points in the United States and points in the European Common Aviation Area where open skies applies; iii) between points in the United States; iv) between points in the EU; v) beyond the EU to open skies points; and vi) beyond the United States to open skies points.

3 The notice referenced in condition (c) above may be used for this notification.