Document ID: DOT-OST-2003-16213-0002
Agency: dot
Document Type: Notice
Title: Notice of Action Taken re:  United Air Lines, Inc. and Air China International Corp.
Posted Date: 2003-10-24T04:00Z

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, DC

Issued by the Department of Transportation on October 24, 2003

   NOTICE OF ACTION TAKEN -- DOCKET OST-2003-16213           

________________________________________________________________________
_________________________________

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 Application of  United Air Lines, Inc. and Air China International
Corp.    filed   9/22/03  for:

XX  Exemption for United under 49 U.S.C. 40109 to provide the following
service:

Scheduled foreign air transportation of persons, property, and mail, in
combination or separately, between any point or points in the United
States, and any point or points in the People’s Republic of China. 
United intends to operate this service pursuant to a reciprocal
code-share arrangement with Air China International Corp.

XX  Statement of authorization for United under CFR Part 212 to:

Permit United to display the “CA” code of Air China on flights
operated by United between (1) any points or points in the United
States, and any point or points in China, and (2) Air China’s
coterminal gateways, as well as between each of those gateways, and 30
additional points in the United States selected by China.

XX  Exemption for Air China under 49 U.S.C. 40109 to provide the
following service:

Scheduled foreign air transportation of persons, property, and mail, in
combination or separately, between any point or points in the People’s
Republic of China, and any point or points in the United States,
pursuant to its code-share arrangement with United.

XX  Statement of authorization for Air China under 14 CFR Part 212 to:

Permit Air China to display the “UA” code of United on flights
operated by Air China between 

(1) any point or points in the People’s Republic of China, and
China’s U.S. coterminal gateways, and (2) United’s coterminal
Chinese gateways, as well as between each of those gateways, and 20
additional points in China selected by the United States. 

Applicant reps: Jeffrey A. Manley  (202) 663-6162 (UA)  DOT Analyst: 
Sylvia Moore  (202) 366-6519

                          George N. Tompkins,  Jr,  (212) 973-8040 ( Air
China)

2

D I S P O S I T I O N

XX  Granted  (subject to conditions, see below)

The above action with respect to United’s exemption authority was
effective when taken:  October 24, 2003, through    October 24, 2005

The above action with respect to Air China’s exemption authority was
effective when taken:  October 24, 2003, through  October 24, 2004

The statements of authorization granted were effective when taken:   
October 24, 2003, and will remain in effect indefinitely, subject to the
conditions listed below.

Action taken by:   Paul L. Gretch, Director	

		    Office of International Aviation

XX  The authority granted is consistent with the aviation agreement
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 United’s
certificates of public convenience and necessity 

	   XX  Air China’s foreign air carrier permit      

	   XX  Standard exemption conditions (Attachments B & C)

_____________________

Remarks:  To afford the carriers maximum flexibility to adjust
code-share operations as market conditions warrant and to enhance
administrative efficiency, we have decided to grant the broad statements
of authorization requested by United and Air China, subject to a 30-day
notice requirement to identify specific points prior to the commencement
of new services, and to grant the related exemption authority needed to
support such operations.  (See conditions below.)  The authority we are
awarding is expressly conditioned so as to be limited by the terms of
the aviation agreement between the United States and the People’s
Republic of China.

The statements of authorization granted are subject to the following
conditions:

(a)	The statements of authorization will remain in effect only as long
as (i) United and Air China 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)	United and/or Air China must promptly notify the Department (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 filed in Docket OST-2003-15805.

(c)	United and/or Air China 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 being. 
(Such notice should be filed in this Docket.)

(d)	The code-sharing conducted under this authority must comply with
Part 257 and with any amendments to the Department’s regulations
concerning code-share arrangements that may be adopted.   

3

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 in the name of the

carrier holding out such service in the computer reservation systems and
elsewhere; that the carrier selling 

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;
and that the 

passenger liability of the operating carrier be unaffected.  Further,
the operating carrier shall not permit the

code of its U.S. air carrier code-sharing partner to be carried on any
flights that enter, depart, or transit the airspace of any area for
whose airspace the Federal Aviation Administration has issued a flight
prohibition.

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

(f)	The authority for Air China to display its code on flights operated
by United, and the authority for United to display its code on flights
operated by Air China, shall be limited to those code-share points which
may be served under the aviation agreement between the United States and
the People’s Republic of China. 

________________________________________________________________________

On the basis of data officially noticeable under Rule 24(g) of the
Department's regulations, we found the carriers qualified to provide the
exemption services authorized.

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 authority was 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, 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:

  HYPERLINK "http://dms.dot.gov//reports/reports_aviation.asp" 
http://dms.dot.gov//reports/reports_aviation.asp 

										Attachment A

United’s “UA” Code on Air China’s  Trans-pacific Flights

Beijing – New York (JFK)

Beijing – Shanghai - Los Angeles

Beijing – San Francisco

United’s “UA” Code on Air China’s Intra-China Flights

Beijing – Guangzhou

Beijing – Shanghai

Beijing – Shenzhen

Beijing – Shenyang

Beijing – Fuzhou

Beijing – Xian

Beijing – Chengdu

Beijing – Chongqing

Air China’s “CA” Code on United’s Trans-pacific Flights

Chicago – Beijing

Chicago – San Francisco –Shanghai

Air China’s “CA” Code on United’s Intra-U.S. Flights

Chicago – Atlanta		Chicago – Boston			     Chicago – Dallas/Ft.
Worth

Chicago – Honolulu		Chicago – Houston		     Chicago – Las Vegas

Chicago – Miami			Chicago – Minneapolis/St. Paul	     Chicago –
Philadelphia

Chicago – Phoenix		Chicago – Portland		     Chicago – Washington,
DC

Chicago – Seattle

Los Angeles – Atlanta		Los Angeles – Boston		     Los Angeles –
Dallas/Ft. Worth

Los Angeles – Honolulu		Los Angeles – Houston		     Los Angeles –
Las Vegas

Los Angeles – Miami		Los Angeles – Minneapolis/St. Paul     Los
Angeles – Philadelphia

Los Angeles – Phoenix		Los Angeles – Portland		     Los Angeles –
Washington, DC

Los Angeles – Seattle

New York – Atlanta		New York – Boston		     New York – Dallas/Ft.
Worth

New York – Honolulu		New York – Houston		     New York – Las Vegas

New York – Miami		New York – Minneapolis/St. Paul        New York
– Philadelphia

New York – Phoenix		New York – Portland		     New York –
Washington, DC

New York – Seattle

San Francisco – Atlanta		San Francisco – Boston		     San
Francisco-Dallas/Ft. Worth

San Francisco – Honolulu		San Francisco – Houston		     San
Francisco – Las Vegas

San Francisco – Miami		San Francisco – Minneapolis/St. Paul  San
Francisco – Philadelphia

San Francisco – Phoenix		San Francisco – Portland		     San
Francisco–Washington, DC

San Francisco - Seattle	

										Attachment B

			

U.S. Carrier Exemption Conditions

In the conduct of the operations authorized, the U.S. carrier
applicant(s) shall:

(1)  Hold at all times effective operating authority from the government
of each country served;

(2)  Comply with applicable requirements concerning oversales contained
in 14 CFR 250 (for scheduled operations, if authorized);

(3)  Comply with the requirements for reporting data contained in 14 CFR
241;

(4)  Comply with requirements for minimum insurance coverage, and for
certifying that coverage to the Department, contained in 14 CFR 205;

(5)  Except as specifically exempted or otherwise provided for in a
Department Order, comply with the requirements of 14 CFR 203, concerning
waiver of Warsaw Convention liability limits and defenses;

(6)  Comply with all applicable requirements of the Federal Aviation
Administration and with all applicable U.S. Government requirements
concerning security.  To assure compliance with all applicable U.S.
Government requirements concerning security, the holder shall, before
commencing any new service (including charter flights) to or from a
foreign airport, contact its Principal Security Inspector (PSI) to
advise the PSI 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; and

(7)  Comply with such other reasonable terms, conditions, and
limitations required by the public interest as may be prescribed by the
Department of Transportation, with all applicable orders and regulations
of other U.S. agencies and courts, and with all applicable laws of the
United States.

The authority granted shall be effective only during the period when the
holder is in compliance with the conditions imposed above.

										08/2003

				Attachment C

Foreign Carrier Conditions

In the conduct of the operations authorized, the foreign carrier
applicant(s) shall:

(1)  Not conduct any operations unless it holds a currently effective
authorization from its homeland 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, including, but not limited to, 14 CFR Parts 129, 91, and
36, and with all applicable U.S. Government requirements concerning
security.  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 Principal Security Inspector (PSI) to advise the PSI 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 coverage
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-260), 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
Chicago 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 instituted 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, point 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 this 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 specifically authorized by the Department, originate or
terminate all flights to/from the United States in its homeland;

(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 terms, 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 not 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.			

			

											 08/2003

 China has already selected Boston, Dallas/Ft. Worth, Detroit, Houston,
Las Vegas, Miami, Minneapolis/St. Paul, Philadelphia, Phoenix, and
Washington, DC as some of the 30 additional U.S. points to be served on
a code-share only basis beyond the designated gateways  (Anchorage,
Atlanta, Chicago, Fairbanks, Honolulu, Los Angeles, New York, Portland,
San Francisco, and Seattle). (See Attachment A for the routes United and
Air China initially propose to serve.)

 The United States has selected Chengdu, Nanjing, Qingdao, Shenyang,
Xiamen, Xian, Wuhan, Fuzhou, Guilin, Kunming, Changsha, Dalian,
Chongqing, Shenzhen, Nanning, Harbin, Changchun, Zhengzhou, Nanchang,
and Lanzhou as those 20 additional China points to be served on a
code-share only basis beyond the Chinese gateways (Beijing, Guangzhou,
and Shanghai).  (See Attachment A for the routes United and Air China
initially propose to serve.)

 We expect this notification to be received within 10 days of such
non-effectiveness or of such decision.

 We note that the code-share agreement as submitted did not include
provisions regarding exclusive dealings between the code-share parties. 
Should the parties subsequently amend their code-share agreement or any
other agreement affecting the code-share services to include a provision
relating to an exclusive arrangement between the parties, that amended
language must first be submitted for consideration by the Department.