I
106TH CONGRESS
1ST SESSION
H. R. 272
To enhance competition between airlines and reduce airfares, and for other
purposes.
IN THE HOUSE OF REPRESENTATIVES
JANUARY 6, 1999
Ms. SLAUGHTER introduced the following bill; which was referred to the
Committee on Transportation and Infrastructure
A BILL
To enhance competition between airlines and reduce airfares,
and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Airline Competition
and Lower Fares Act’’.
SEC. 2. WITHDRAWAL OF SLOTS.
(a) WRITTEN DETERMINATION.—Not later than 1
year after the date of the enactment of this Act, the Sec-
retary shall issue a separate written determination with
respect to each high-density airport as to whether the de-
mand among air carriers for slots at the airport can be
met with the slots at the airport that are available to the
Secretary.
(b) INITIAL WITHDRAWAL OF SLOTS.—If the Sec-
retary determines under subsection (a) that the demand
among air carriers for slots at a high-density airport can-
not be met with the slots at the airport that are available
to the Secretary, the Secretary shall withdraw slots at that
airport from dominant air carriers at the airport for redis-
tribution pursuant to this Act. Such withdrawals shall be
made in accordance with section 41714 of title 49, United
States Code, and other applicable laws and regulations.
(c) SUBSEQUENT WITHDRAWALS.—
(1) WRITTEN DETERMINATION.—Not later than
2 years after the date of the auction under section
3(a), and every 2 years thereafter, the Secretary
shall issue a written determination as to whether the
redistribution of additional slots under this Act
would significantly increase competition between air
carriers.
(2) REQUIREMENT TO WITHDRAW SLOTS.—If
the Secretary determines under paragraph (1) that
the redistribution of additional slots would signifi-
cantly increase competition, the Secretary shall with-
draw slots, in accordance with this section, in a
(c) ELIGIBLE BIDDERS.—A person may bid for or
hold a slot at a high-density airport offered at an auction
conducted under this section only if that person—
(1) is a new entrant air carrier or limited in-
cumbent air carrier at the airport;
(2) is a citizen of the United States, or in the
case of a partnership or corporation, organized
under the laws of the United States or a State;
(3) has appropriate safety certification from the
Federal Aviation Administration;
(4) has appropriate economic certification from
the Department of Transportation;
(5) has not declined any slot at the airport for
which the new entrant air carrier or limited incum-
bent air carrier was eligible before January 1, 1986;
(6) is qualified, as determined by the Secretary,
to use a purchased slot; and
(7) is not substantially owned or otherwise con-
trolled, as determined by the Secretary, by a person
who fails to meet any of the requirements estab-
lished by paragraphs (1) through (6).
(d) LIMITATION ON TRANSFER OF SLOTS.—A slot
obtained by a new entrant air carrier or limited incumbent
air carrier at a high-density airport through an auction
conducted under this section may only be sold, leased,
traded, or transferred to any other new entrant air carrier
or limited incumbent air carrier at the airport that meets
the requirements of subsection (c).
(e) CHANGES IN OWNERSHIP.—If there is a change
in the ownership of a new entrant air carrier or limited
incumbent air carrier that obtains a slot through an auc-
tion conducted under this section, the slot shall revert to
the Secretary; except that the Secretary may allow the new
entrant air carrier or limited incumbent air carrier to re-
tain the slot if the Secretary determines that such action
is in the best interest of promoting competition.
(f) LIMITATION ON STATUTORY CONSTRUCTION.—
Nothing in this section or section 2, including the use of
competitive bidding, may be construed—
(1) to alter slots allocation criteria and proce-
dures established by section 41714 of title 49,
United States Code, or any other provision of law;
(2) to diminish the authority of the Secretary
under any other provision of law to regulate or with-
draw slots; or
(3) to convey any rights, including any expecta-
tion of renewal of a slot assignment, that differ from
the rights that apply to other slots at the same air-
port that were not issued pursuant to this section.
(g) REVENUES.—The Secretary may use funds re-
ceived from auctions held pursuant to this section to pro-
vide reimbursement to any dominant air carrier from
which a slot has been withdrawn under this Act for invest-
ments made by the carrier in the withdrawn slot and air-
port improvements at the airport where the carrier held
the withdrawn slot. Any funds remaining after providing
such reimbursements shall be credited to the general fund
of the Treasury as miscellaneous receipts.
SEC. 4. SLOTS NOT ASSETS.
(a) IN GENERAL.—A slot obtained under this Act or
any other provision of law shall not be considered an asset
for any purpose, including for collateral, for any agree-
ment which would require forfeiture of the slot, or in any
bankruptcy proceeding.
(b) APPLICABILITY.—This section shall not apply to
any agreement or any renewal provision of any agreement
in effect on the date of the enactment of this Act.
SEC. 5. UNFAIR COMPETITION.
(a) 
DETERMINATIONS
REGARDING
ACTIONS
FILED.—
(1) ACTIONS FILED ON OR BEFORE DECEMBER
31, 1998.—Not later than 6 months after the date of
the enactment of this Act, the Secretary shall com-
plete action on all complaints alleging predatory
practices by air carriers that were filed with the Sec-
retary on or before December 31, 1998.
(2) ACTIONS FILED AFTER DECEMBER 31, 1998,
AND BEFORE THE DATE OF THE ENACTMENT OF
THIS ACT.—Not later than 9 months after the date
of the enactment of this Act, the Secretary shall
complete action on all complaints alleging predatory
practices by air carriers that were filed with the Sec-
retary after December 31, 1998, but before the date
of the enactment of this Act.
(3) ACTIONS FILED ON OR AFTER THE DATE
OF THE ENACTMENT OF THIS ACT.—The Secretary
shall make an initial finding regarding any com-
plaint alleging a predatory practice by an air carrier
that is filed with the Secretary after the date of the
enactment of this Act, not later than 30 days after
such complaint is filed.
(b) RESTRAINING ORDER.—Not later than 15 days
after date of an initial finding under subsection (a)(3),
and after notice and opportunity for a hearing, the Sec-
retary shall enjoin, pending final determination, any ac-
tion that is found to be a predatory practice.
(c) REPORT
TO
CONGRESS.—Not later than 6
months after the date of the enactment of this Act, and
every 6 months thereafter, the Secretary shall transmit
a report to Congress describing complaints received by the
Secretary which allege predatory practices by air carriers
and any action taken by the Secretary on those com-
plaints.
(d) GUIDELINES.—Not later than 6 months after the
date of the enactment of this Act, the Secretary, in con-
sultation with the Attorney General of the United States,
shall issue guidelines defining predatory practices and un-
fair competition practices under this section and under
title 49, United States Code.
SEC. 6. ACCESS TO FACILITIES.
The Secretary shall ensure that all airport facilities
are available to new entrant air carriers at fees that are
comparable to the average fees paid by incumbent air car-
riers.
SEC. 7. EVALUATION OF RULE.
The Secretary shall initiate a rulemaking proceeding
to determine whether the application of the 80-percent
rule contained in section 93.227(a) of title 49, Code of
Federal Regulations, promotes, hinders, or has no effect
on airline competition.
SEC. 8. LIMITS ON COMPETITION IN AVIATION INDUSTRY.
Not later than 1 year after the date of the enactment
of this Act, and annually thereafter, the Secretary shall
transmit to Congress a report on barriers to entry, preda-
tory pricing, and other limits on competition in the avia-
tion industry.
SEC. 9. CLARIFICATION OF LEGAL STANDING.
Section 41713(b) of title 49, United States Code, is
amended by adding at the end the following new para-
graph:
‘‘(5) PROTECTION OF CERTAIN CAUSES OF ACTION.—
This subsection shall not bar any cause of action brought
against an air carrier by 1 or more private parties seeking
to enforce any right under the common law of any State
or under any State statute, other than a statute purport-
ing to directly prescribe fares, routes, or levels of air
transportation service.’’.
SEC. 10. DEFINITIONS.
For the purposes of this Act, the following definitions
apply:
(1) AIR CARRIER.—The term ‘‘air carrier’’ has
the meaning given the term in section 40102 of title
49, United States Code.
(2) DOMINANT AIR CARRIER.—The term ‘‘domi-
nant air carrier’’ means a person that holds 10 per-
cent or more of the slots at a high-density airport.
(3) HIGH-DENSITY AIRPORT.—.The term ‘‘high-
density airport’’ means each of the following air-
ports:
(A) LaGuardia Airport.
(B) O’Hare International Airport.
(C) John F. Kennedy International Air-
port.
(D) Ronald Reagan Washington National
Airport.
(4) LIMITED INCUMBENT AIR CARRIER.—The
term ‘‘limited incumbent air carrier’’ means a per-
son that holds or operates fewer than 12 slots at a
high-density airport, not including international
slots, essential air service program slots, or slots be-
tween the hours of 2200 and 0659 at Ronald
Reagan Washington National Airport or LaGuardia
Airport.
(5) LOW-COMPETITION
AIRPORT.—The term
‘‘low-competition airport’’ means an airport that the
Secretary determines—
(A) is not a large hub; and
(B) has substantially less service than av-
erage or substantially higher than average air-
fares.
(6) NEW
ENTRANT
AIR
CARRIER.—The term
‘‘new entrant air carrier’’ means a person that does
not hold a slot at a high-density airport and has not
sold or given up a slot at that airport after Decem-
ber 16, 1985.
(7) PERSON.—The term ‘‘person’’ includes a
commuter operator or air carrier.
(8) SECRETARY.—The term ‘‘Secretary’’ means
the Secretary of Transportation.
(9) SLOT.—The term ‘‘slot’’ means the oper-
ational authority to conduct one landing or takeoff
operation each day during a specific hour or 30
minute period at a high-density airport.
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