Decision No. 122-A-1997

March 5, 1997

March 5, 1997

APPLICATIONS by Canadian Airlines International Ltd., carrying on business under the firm name and style of either Canadian Airlines International or Canadi*n (hereinafter Canadi*n) (* The Company's symbol appears between the "i" and the "n" in the trade name), and Mandarin Airlines Limited (hereinafter Mandarin) for approval of the Joint Operation Agreement, Annex 11 thereto, and Supplement Agreement No. 1 dated August 12, 1995 between Canadi*n and Mandarin; and for an approval to permit Mandarin to use aircraft with flight crew provided by China Airlines Ltd., for the period from October 27, 1996 to March 29, 1997.

File No. M4835-3-18


Canadi*n and Mandarin have applied to the Canadian Transportation Agency (hereinafter the Agency) for the approvals set out in the title. The applications were received on October 15, 1996.

On July 1, 1996, the Canada Transportation Act, S.C., 1996, c. 10 (hereinafter the CTA) came into effect. Section 60 of the CTA and sections 8.2 to 8.5 of the Air Transportation Regulations, SOR/88-58, as amended (hereinafter the ATR), apply to the provision of aircraft with flight crew. In accordance with subsection 8.2(1) of the ATR, Agency approval of the applications is required.

The Agency has now considered the matter and, for the period from October 27, 1996 to March 29, 1997:

  1. pursuant to the Minister of Transport's direction of December 4, 1990 and section 76 of the CTA, the Agency hereby approves the Joint Operation Agreement dated November 1, 1991, Annex 11 thereto, and the Supplemental Agreement No. 1 dated August 12, 1995;
  2. pursuant to paragraph 60(1)(b) of the CTA and section 8.2 of the ATR, the Agency hereby approves the provision by Canadi*n and Mandarin of aircraft with flight crew to the other air carrier; and the provision by Canadi*n and Mandarin of their licenced international scheduled services between Vancouver and Taipei by blocking space and selling transportation on each other's aircraft only for those additional flights that may be operated pursuant to Annex 11, paragraph 4 thereof;
  3. pursuant to paragraph 60(1)(b) of the CTA and section 8.2 of the ATR, the Agency hereby approves the use by Mandarin of aircraft with flight crew provided by China Airlines Ltd.; and
  4. pursuant to paragraph 80(1)(c) of the CTA, the Agency hereby orders that Mandarin be exempted from the application of paragraph 60(1)(a) of the CTA and section 8.5 of the ATR, to the extent that aircraft and flight crew and any public advertising or displays shall only bear the corporate identification of Mandarin.

Notwithstanding any provisions to the contrary in any agreement or arrangement between Canadi*n and Mandarin, or between Mandarin and China Airlines Ltd., the approvals set out above are subject to the following conditions:

  1. Both Canadi*n and Mandarin shall have valid and subsisting scheduled international licences for air services between Canada and Taiwan.
  2. The approvals granted herein do not apply to the blocking of space for the carriage of cargo.
  3. Each air carrier shall apply its published tariffs, on file with the Agency and in effect, to the carriage of its traffic. In particular, nothing in any commercial agreement between the two air carriers relating to limits of liability shall diminish the rights of passengers as stated in such tariffs.
  4. Mandarin's flight numbers shall be restricted to services between Vancouver and Taipei, Taiwan.
  5. Unless otherwise authorized by the Agency upon application, Mandarin shall, for the purpose of providing the scheduled international air service authorized herein, exclusively use aircraft bearing the logos, trade marks, trade names and/or other corporate identification of Mandarin.
  6. Air services provided by Mandarin using aircraft and flight crew provided by China Airlines Ltd. shall be operated under Mandarin's scheduled international licence (Licence No. 910304).
  7. Commercial control of the air services provided by Mandarin shall be maintained by Mandarin and, at all times, aircraft and flight crew and any public advertising or displays shall bear the corporate identification of Mandarin. In reference to Article 4 of the Aircraft Lease Agreement between Mandarin and China Airlines Ltd., remuneration to China Airlines Ltd. shall not be based on the volume of traffic carried or any other revenue-sharing formula.

Canadi*n and Mandarin are reminded of the continuing requirement to comply, except as may be provided for above, with sections 8.2 and 8.5 of the ATR. Furthermore, Canadi*n and/or Mandarin shall provide the Agency with copies of any revisions to the commercial agreement or its annexes for approval.

It should be noted that the approvals granted herein do not exempt Canadi*n and Mandarin from the requirements of other legislative acts or regulations, including those of Transport Canada.

Statistics submitted in accordance with the Carriers Information Regulations, SOR/96-334, are required to distinguish the traffic carried by each air carrier. Detailed information regarding reporting requirements can be found in a document entitled "Instruction for Reporting Co-Host Data for Joint Agreement (scheduled) Flights", which is available from the Aviation Statistics Centre, Ottawa, Ontario, Canada K1A ON9, (819) 953-3347 (telephone) or (819) 953-8499 (facsimile).

This Decision takes effect on October 25, 1996, the date on which its content was communicated by letter to the parties of record.

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