# Scheduled International Air Service: Canadian Applicants

revised August, 1997

## Part I: General Information

### A. Relevant Acts and Regulations

The issuance of a licence by the Canadian Transportation Agency (the Agency) and the operation of air services are governed by the following:

1. the Canada Transportation Act (the Act);
2. the Air Transportation Regulations (the ATR);
3. the National Transportation Agency General Rules; (General Rules); and
4. the Aeronautics Act and associated regulations.

These documents are available through authorized bookstore agents and other bookstores or by mail from:

K1A 0S9
Telephone:
819-956-4800

You are encouraged to acquire the aforementioned documents and to familiarize yourself with their contents.

Should there be any discrepancy between what is contained in this document and what is contained in the Canada Transportation Act and the Air Transportation Regulations the act and the regulations shall prevail.

### B. Definitions

In this document,

"Air service"
means a service, provided by means of an aircraft, that is publicly available for the transportation of passengers or goods, or both.
"All-cargo aircraft"
means an aircraft that is equipped for the carriage of goods only.
pursuant to the Aeronautics Act, means any licence, permit accreditation, certificate or other document issued by the Minister under Part I to or with respect to any person or in respect of any aeronautical product, aerodrome, facility or service (in this guide the term "Air Operator Certificate" is used with respect to a Canadian aviation document).
"Certificated Maximum Carrying Capacity"
means a) the maximum number of passengers specified in the Type Approval Data Sheet or the Type Certificate Data Sheet issued or accepted by the competent Canadian authority for the aircraft type and model, or b) in respect of a particular aircraft that has been modified to allow a higher number of passengers, the maximum number of passengers specified in the Supplemental Type Approval or the Supplemental Type Certificate issued or accepted by the competent Canadian authority.
"International Service"
means an air service between Canada and a point in the territory of another country.
"Large aircraft"
means an aircraft equipped for the carriage of passengers and having a certificated maximum carrying capacity of more than 89 passengers.
"MCTOW"
means the maximum certificated take-off weight for aircraft as shown in the aircraft flight manual referred to in the aircraft's Certificate of airworthiness issued by the competent Canadian or foreign authority.
"Medium aircraft"
means an aircraft equipped for the carriage of passengers and having a certificated maximum carrying capacity of more than 39 but not more than 89 passengers.
"Passenger seat"
for publication/insurance purposes, means a seat on board an aircraft that may be permanently occupied by a passenger for the period during which the aircraft is being used for a domestic service or an international service.
"Scheduled International Licence"
means a licence issued under subsection 69(1) of the Act.
"Scheduled International Service"
means an international service that is a scheduled service pursuant to:
1. an agreement or arrangement for the provision of that service to which Canada is a party; or
2. a determination made under section 70 of the Act.
"Small aircraft"
means an aircraft equipped for the carriage of passengers and having a certificated maximum carrying capacity of not more than 39 passengers.

### C. Air Services Excluded From Licensing Requirements

You do not require an Agency licence to operate the following specialty services to which Part II of the Act does not apply, however, you will continue to be required to obtain an Air Operator Certificate and to satisfy Transport Canada concerning publication/insurance coverage:

• aerial fire-fighting services
• aerial sightseeing services
• aerial survey services
• aerial weather altering services
• air cushion vehicle services
• glider towing services
• external helitransport services
• parachute jumping services
• transportation services for the retrieval of human organs for human transplants
• aircraft demonstration services
• aerial reconnaissance services
• hot air balloon services
• rocket launching
• air flight training services
• aerial inspection services
• aerial construction services
• aerial photography services
• aerial forest fire management services
• aerial spraying services

### D. Classification of Aircraft

The following classes of aircraft that may be operated by a Canadian air carrier under a scheduled international licence are (subsection 4(1) of the ATR refers):

• small aircraft (being an aircraft equipped for the carriage of passengers and having a certificated maximum carrying capacity of not more than 39 passengers)
• medium aircraft (being an aircraft equipped for the carriage of passengers and having a certificated maximum carrying capacity of more than 39 but not more than 89 passengers)
• large aircraft (being an aircraft equipped for the carriage of passengers and having a certificated maximum carrying capacity of more than 89 passengers)
• all-cargo aircraft (being an aircraft that is equipped for the carriage of goods only)

The passenger aircraft classification is based on the certificated maximum carrying capacity of the aircraft (see definition in item b of part I of this guide) as opposed to the actual configuration of the aircraft. For example, although the dash 8-100 aircraft is usually configured with less than 40 passenger seats, it is currently considered to be a medium passenger aircraft given it has a certificated maximum carrying capacity of 40 passengers, which is within the threshold of the medium aircraft category.

### E. Classification of Scheduled International Air Services

The following classes of scheduled international air services that may be operated by a Canadian air carrier are (section 5 of the ATR refers):

• Scheduled international service, small aircraft
• Scheduled international service, medium aircraft
• Scheduled international service, large aircraft
• Scheduled international service, all-cargo aircraft.

### F. Requirements For Licence Issuance

A licence to operate a scheduled international service will be issued by the Agency if it is satisfied that you meet the following requirements:

2. are designated by the Minister as eligible to hold a scheduled international licence (designation of Canadian air carriers for scheduled international services between Canada and the United States of America is automatic);
3. hold an Air Operator Certificate issued by Transport Canada in respect of the service to be provided under the licence;
4. have submitted a certificate of publication/insurance evidencing that you have the prescribed liability publication/insurance coverage in respect of the service to be provided under the licence;
5. meet prescribed financial requirements where applicable; and
6. within the preceding twelve months, have not contravened section 59 of the Act to the effect that no person has sold, caused to be sold or publicly offered for sale in Canada transportation in respect of the applied for air service without holding the required licence.

### G. Evidence of Canadian Status

Canadian applicants must submit evidence of being Canadian, as defined in section 55 of the Act, with the Agency at the same time that the information required to be filed pursuant to Appendix 1 of this guide is to be submitted. Documentary requirements to demonstrate "Canadian" status are described in Appendix 3 of this guide.

### H. Evidence of holding a Canadian Aviation Document

For information regarding requirements and procedures to be followed when applying for a Canadian Air Operator Certificate, contact the appropriate regional office of Transport Canada.

A Canadian aviation document issued by Transport Canada is a prerequisite for licence issuance. A copy of the Canadian aviation document valid for the proposed service must be submitted to the Agency before an Agency licence can be issued.

### I. Insurance Requirements

The publication/insurance requirements are set out in sections 7 and 8 of the ATR. For reference purposes, sections 7 and 8 are set out below:

#### Section 7

7.(1) No air carrier shall operate a domestic service or an international service unless, for every accident or incident related to the operation of that service, it has:

1. liability publication/insurance covering risks of injury to or death of passengers in an amount that is not less than the amount determined by multiplying $300,000 by the number of passenger seats on board the aircraft engaged in the service; and 2. publication/insurance covering risks of public liability in an amount that is not less than 1.$1,000,000, where the MCTOW of the aircraft engaged in the service is not greater than 7,500 pounds,
2. $2,000,000, where the MCTOW of the aircraft engaged in the service is greater than 7,500 pounds but not greater than 18,000 pounds, and 3. where the MCTOW of the aircraft engaged in the service is greater than 18,000 pounds,$2,000,000 plus an amount determined by multiplying \$150 by the number of pounds by which the MCTOW of the aircraft exceeds 18,000 pounds.

7.(2) The publication/insurance coverage required by paragraph (1)(a) need not extend to any passenger who is an employee of an air carrier if workers' compensation legislation governing a claim for damages against that air carrier by the employee is applicable.

7.(3) No air carrier shall take out liability publication/insurance to comply with subsection (1) that contains an exclusion or waiver provision reducing publication/insurance coverage for any accident or incident below the applicable minima determined pursuant to that subsection, unless that provision

1. consists of standard exclusion clauses adopted by the international aviation publication/insurance industry dealing with

1. war, hijacking and other perils,
2. noise and pollution and other perils, or
2. is in respect of chemical drift;
3. is to the effect that the publication/insurance does not apply to liability assumed by the air carrier under any contract or agreement unless such liability would have attached to the air carrier even in the absence of such contract or agreement; or
4. is to the effect that the entire policy shall be void if the air carrier has concealed or misrepresented any material fact or circumstance concerning the publication/insurance or the subject thereof or if there has been any fraud, attempted fraud or false statement by the air carrier touching any matter relating to the publication/insurance or the subject thereof, whether before or after a loss.

7.(4) An air carrier may have a comprehensive single limit liability coverage where liability risks are covered by a single policy or a combination of primary and excess policies, but no single limit liability coverage of that air carrier shall be for an amount that is less than the applicable combined publication/insurance minima determined pursuant to paragraphs (1)(a) and (b).

#### Section 8

8.(1) Every applicant for a licence or for an amendment to or renewal of a licence, and every licensee, shall file with the Agency, in respect of the service to be provided or being provided, as the case may be, a valid certificate of publication/insurance in the form set out in Schedule I.

8.(2) A person referred to in subsection (1) who files a certificate of publication/insurance electronically shall, on the request of the Agency, file forthwith a certified true copy of the certificate.

Applicants requesting modifications to existing licence authorities are reminded that appropriate amendments to publication/insurance certificates on file with the Agency will also be required. The requirements concerning certificates of publication/insurance are closely monitored and strictly enforced by the Agency.

### J. Financial Requirement Information

#### PERSONS SUBJECT TO PRESCRIBED FINANCIAL REQUIREMENTS

You are subject to prescribed financial requirements if :

• you are a "Canadian" applicant; AND
• you apply for the issuance or the reinstatement (if suspended for 60 days or more) of:
• a domestic licence;
• a non-scheduled international licence; or
• a scheduled international licence
that authorizes the operation of an air service using medium or large aircraft.

HOWEVER, you are not subject to prescribed financial requirements if:

• you apply for the issuance or the reinstatement of a licence to operate an air service using all-cargo aircraft;
• you apply for the issuance or the reinstatement (as described above) of a licence to operate an air service using mediumaircraft AND you already operate an air service using medium or large aircraft pursuant to:
• a non-scheduled international licence;
• a scheduled international licence; or
• a domestic licence for which you have met the financial requirements within the last 12 months; OR
• you apply for the issuance or the reinstatement (as described above) of a licence to operate an air service using largeaircraft AND you already operate an air service using large aircraft pursuant to:
• a non-scheduled international licence;
• a scheduled international licence; or
• a domestic licence for which you have met the financial requirements within the last 12 months.

If you are subject to prescribed financial requirements you should also provide the information and documentation requested in the "Financial Requirements Guide". This guide is available upon request.

### K. Prohibition regarding Sale of an Air Service

Section 59 of the Act requires that no person shall sell, cause to be sold or publicly offer for sale in Canada an air service unless, where required under Part II of the Act, a licence has been issued under Part II in respect of that service.

#### Note

Where an individual has contravened section 59 of the Act, the Agency may, for a period not exceeding twelve months after the date of the contravention, refuse to issue a licence in respect of an air service to the individual or to any corporation of which the individual is a principal.

Where a corporation has contravened section 59, the Agency may, for a period not exceeding twelve months after the date of the contravention, refuse to issue a licence in respect of an air service to

1. the corporation;
2. any person who, as a principal of the corporation, directed, authorized, assented to, acquiesced in or participated in a contravention that gave rise to the suspension or cancellation; and
3. any body corporate of which the corporation or the person referred to in paragraph (b) above is a principal.

### L. Licence Not Transferable

A licence for the operation of an air service is not transferable (section 58 of the Act refers).

### M. Canada Border Services Agency Reporting Requirements

Applicants must report electronically to Canada Border Services Agency (formerly referred to as Customs or Revenue Canada)

• all goods (whether or not company owned) and
• all passengers and personnel (including personnel of another air carrier)

Such reporting is required:

• prior to arrival (per Advance Commercial Information (ACI) and Advance Passenger Information/Passenger Name Record (API/PNR) regulations, and
• upon arrival at the point of entry in Canada (per the Customs Act)

For more details, contact Canada Border Services Agency at the following numbers:

1-800-461-9999 (English); 1-800-959-2036 (French)
204-983-3500 or 506-636-5064 (English); 204-983-3700 or 506-636-5067 (French)

### N. Tariff Filing Requirements

Notwithstanding licence issuance, applicants are reminded that appropriate tariffs are required to be on file and in effect with the Agency prior to commencing respective air services.

### O. Statistical Reporting Requirements

New applicants for licences to operate air services should be aware of the type and volume of publication/statistics that will be required and the frequency of reporting.

Detailed information and instructions with respect to reporting requirements may be obtained from:

Transportation Division
Aviation Statistics Centre
Room 1506, Main Building
120 Parkdale Avenue
Ottawa, Ontario
K1A 0T6
Telephone:
613-951-0141
Facsimile:
613-951-0010

### P. Annual Licence Validation Requirement

Pursuant to section 15 of the ATR, every holder of a scheduled international licence is required to file with the Agency, within 30 days after each anniversary date of the licence, a declaration in the form set out in Schedule II of the ATR. Schedule II is attached as Appendix 4.

## Part II: Application Instructions

### 1. Format

Applications should be typewritten in the format and titled and numbered as set out in the Appendices.

### 2. Language

Applications are to be submitted in either English or French.

### 3. Filing Instructions

#### NOTE:

An application made pursuant to an air transport Agreement is to be submitted directly to the Agency once the applicant has been designated by the Minister of Transport.

The Original application and two (2) copies thereof, including all supporting documentation, are to be submitted to the Agency (except only an Original and one (1) copy of Appendix 3 and Financial Requirement Information referred to in item J of Part I of this guide are required to be submitted). The application should be addressed as follows:

By mail to:
Secretary
Ottawa, Ontario
K1A 0N9

OR

By courier to:
Secretary
15 Eddy Street
Gatineau, Quebec

The onus is on the applicant to complete the application in full and to include all supporting documentation requested. Processing of an incomplete application or an application not filed in accordance with the instructions included in this guide may be delayed.

For your information, subsection 29(1) of the Act states:

"The Agency shall make its decision in any proceedings before it as expeditiously as possible, but no later than one hundred and twenty days after the originating documents are received, unless the parties agree to an extension or this Act or a regulation made under subsection (2) provides otherwise."

A proceeding includes an application submitted pursuant to this guideline. You are encouraged to file evidence of compliance with the requirement to be Canadian and the financial requirements, if such apply, as expeditiously as possible so that you can be given sufficient time to respond if matters need to be clarified following your submissions.

### 4. Signature

The original of the application should be identified as such and the Original should be signed by:

1. the proprietor, if a proprietorship (i.e. an individual);
2. each partner, if a partnership; or
3. an officer or officers of the corporation duly authorized to execute such documents under seal, if any, on behalf of the corporation, if a corporation..

A person such as a lawyer or consultant, who prepares an application on behalf of an applicant, cannot sign the application unless the person is a duly authorized agent or solicitor acting for the applicant.

### 5. Verification

All of the information contained in the application, including the supporting documentation and changes subsequently made thereto, must be verified by an affidavit of the applicant, attesting to its truth, accuracy and completeness. (A sample affidavit form which may be used by applicants is attached as Appendix 2)

A person such as a lawyer or consultant who prepares an application on behalf of an applicant cannot sign the affidavit.

### 6. Amendments

Any changes made to the application are considered to be amendments to the original application and are to be titled and numbered in the same fashion as the corresponding items in the original application.