Document ID: DOT-OST-1996-2025-0023
Agency: dot
Document Type: Notice
Title: Notice of Action Taken re: Federal Express Corporation
Posted Date: 2006-03-29T05:00Z

UNITED STATES OF AMERICA

		        DEPARTMENT OF TRANSPORTATION

			  OFFICE OF THE SECRETARY

			          WASHINGTON, D.C.

Issued by the Department of Transportation on March 29, 2006

NOTICE OF ACTION TAKEN -- DOCKETS OST-1996-2018

				 	                       	                       OST-1996-2025

________________________________________________________________________
________________________________________

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).

Docket OST-1996-2018: Application of Federal Express Corporation (FedEx
Express) filed 2/9/06 for: 

XX  Waiver of 90-day dormancy condition for U.S.-Russia all-cargo
frequencies

By Order 96-2-17, the Department granted FedEx Express exemption
authority to provide scheduled all-cargo service in the New
York/Memphis-Moscow market and allocated it five weekly all-cargo
frequencies for this service.  That award was subject to the condition
that the frequency allocation would expire automatically and the
frequencies would revert to the Department for reallocation if they were
not used for a period of 90 days.

On November 1, 1999, FedEx Express temporarily suspended its direct
flight operations serving Moscow.  By various Notices of Action Taken
the Department granted FedEx Express waivers of the 90-day dormancy
condition for all five frequencies.  The most recent waiver expires
April 11, 2006 (see Notice of Action Taken, dated April 9, 2004).

In support of its present waiver request, FedEx Express states that at
the time it inaugurated all-cargo service to Russia in 1996, the
U.S.-Russian Federation bilateral agreement provided for the exercise of
fifth-freedom traffic rights at intermediate points in Europe.  The
carrier further states that in 2002, the Route Annex to the U.S.-Russian
Federation bilateral agreement was revised to suspend those European
fifth-freedom rights, and that the moratorium against the exercise of
fifth-freedom rights at European points was retained in the latest
revision to the Route Annex, negotiated in October 2005.  The moratorium
is currently set to expire on March 25, 2007.  

FedEx Express asserts that it can undertake a commercially viable
operation only if it can combine U.S.-Russia traffic at its European hub
in Paris.  The carrier further asserts that the revisions to the Annex
make it impossible for FedEx Express to use its frequencies as planned,
thus warranting extension of the current dormancy waiver.  FedEx Express
states that it remains keenly interested in, and committed to,
reinstituting scheduled all-cargo service as soon as regulatory and
economic conditions permit.  

Applicant rep: David E. Short  (901) 434-8584  DOT Analyst: Thuy H.
Cooper  (202) 366-5423

Docket OST-1996-2025: Application of Evergreen International Airlines,
Inc. (Evergreen) filed 2/14/06 for: 

		

XX  Waiver of 90-day dormancy condition for U.S.-Russia all-cargo
frequencies

	On February 14, Evergreen filed an application requesting that the
Department renew its waiver of the standard dormancy conditions imposed
on its three U.S.-Russia all-cargo frequencies for an indefinite period
or, alternatively, renew Evergreen’s waiver for an additional two
years.  The carrier states that it first commenced operations to Russia
in 1995; however, the events of September 11, 2001, and the immediate
resulting downturn in economic activity in the air cargo market have
made it difficult for Evergreen to continue its U.S.-Russia operations. 
By various Notices of Action Taken, the Department has granted Evergreen
waivers of the 90-day dormancy condition for all three frequencies.  The
most recent waiver expires March 31, 2006 (see Notice of Action Taken,
dated February 24, 2005).  Evergreen states that it remains committed to
reinstituting its U.S.-Russia operations once economic conditions can
sustain profitable levels of service.

  

Applicant rep: Robert P. Silverberg  (202) 944-3304 DOT Analyst: Thuy H.
Cooper  (202) 366-5423

XX  Granted in part (see remarks below)

XX  Dismissed longer term waiver request 

The above action was effective when taken: March 29, 2006, through March
25, 2007.

Action taken by:   Paul L. Gretch, Director	

		      Office of International Aviation	

Remarks: We grant in part the applications filed by FedEx Express and
Evergreen for waivers of the dormancy condition for their U.S.-Russia
all-cargo frequencies.  We have decided to grant the waivers through
March 25, 2007, the expiration date of the Annexes to the October 5,
2005 Protocol Between the Government of the United States of America and
the Government of the Russian Federation to Amend the January 14, 1994
Air Transport Agreement Between the Government of the United States of
American and the Government of the Russian Federation (“the
Annexes”).  In taking this action, we find that grant of the requested
waivers is in the public interest in the circumstances presented;
namely, the suspension per the terms of the Annexes of the U.S. carrier
fifth-freedom rights between points in Europe and points in the Russian
Federation, the downturn in economic activity that has been experienced
in the air cargo market, and the fact that no party opposed the
respective waiver requests here.  

With respect to the request for an indefinite waiver, FedEx Express and
Evergreen both cite other waiver cases involving Russia.  However, we
view those cases as inapposite.  First, the requests for waiver in those
cases were not based on any temporary suspension of rights scheduled to
end on an established date.  Also, those other requests involved cases
of partial rather than complete suspension of use of certain
frequencies.

________________________________________________________________________
__________________________________________

Under authority assigned by the Department in its regulations, 14 CFR
Part 385, we found that (1) our action was consistent with Department
policy; (2) grant of the waivers were consistent with the public
interest; and (3) grant of the authority would not constitute a major
regulatory action under the Energy Policy and Conservation Act of 1975. 
To the extent not granted or 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 Department 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 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: http://dms.dot.gov//reports/reports_aviation.asp

 FedEx Express asks that the waiver be granted indefinitely or,
alternatively, for a period of two years.

 On October 5, 2005, the United States and Russia expressed their intent
to implement the provisions of the Annexes on the basis of comity and
reciprocity until both governments take the actions to bring the Annexes
into force.

 See Notice of Action Taken, dated February 8, 2005, in Docket
OST-2005-20116 and Notices of Action Taken, dated December 3, 2004 and
January 3, 2005, 湩䐠捯敫⁴协ⵔ〲㐰ㄭ㌹㔷‮ഠ

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