Decision No. 155-C-A-2008

April 4, 2008

File No. M4120-3/07-04461

---

INTRODUCTION

[1] On June 1, 2007, Air Canada revised its tariffs to terminate the carriage of pets and their kennels weighing less than 70 lbs as checked baggage. Air Canada had previously discontinued carrying pets and their kennels weighing in excess of 70 lbs as checked baggage.

[2] Peter Griffiths complained to the Canadian Transportation Agency (the Agency) that Air Canada's action of June 1, 2007 is unreasonable.

[3] Pending determination of Mr. Griffiths' complaint, the Agency suspended the provisions, revised on June 1, 2007, appearing in Air Canada's tariffs governing international transportation. The Agency does not have the jurisdiction to suspend terms and conditions of carriage applicable to domestic service until such time as the Agency determines that such terms and conditions are unreasonable or are unduly discriminatory.

[4] As indicated in the reasons that follow, the Agency disallows, as being unreasonable, Air Canada's tariff revisions that result in the discontinuation of the carriage of pets and their kennels weighing less than 70 lbs, as checked baggage.

PRELIMINARY MATTER

[5] In his complaint, Mr. Griffiths specifically refers to the negative impact that Air Canada's change in policy has on the carriage of his pet between Canada and Mexico. The Agency finds that Mr. Griffiths' submission contains sufficient information to allow a reasonable person to conclude that Mr. Griffiths considers the amendments to Air Canada's domestic and international passenger tariffs concerning the carriage of pets as checked baggage to be unreasonable.

ISSUE

[6] Is Air Canada's proposed discontinuation of the carriage of pets and their kennels weighing less than 70 lbs as checked baggage unreasonable, and thereby inconsistent with the Canada Transportation Act, S.C., 1996, c. 10, as amended (the CTA), and the Air Transportation Regulations, SOR/88-58, as amended (the ATR)?

SUBMISSIONS

[7] Mr. Griffiths submits that the charge for the carriage of his pet dog, which weighs 6 kg, will increase from $105, which is the amount assessed for carriage of a kennel as checked baggage, irrespective of the size of the kennel, to $220, which represents the amount to carry the dog as cargo. Mr. Griffiths notes that his pet may not travel on the same aircraft on which he is a passenger, that the pet may be required to stop over, perhaps even overnight, and that it is inconvenient for him to deliver his pet to a cargo terminal at his point of departure, and to retrieve the pet from a cargo terminal at destination. Mr. Griffiths further notes that the carriage of heavier animals as cargo rather than checked baggage will result in the tripling or quadrupling of charges, and that cargo shipments are subject to the Goods and Services Tax and Provincial Sales Tax, whereas the carriage of animals as checked baggage was not subject to such taxes, or was inclusive of these taxes.

[8] Air Canada submits that its decision to discontinue carrying animals as checked baggage is designed to ensure that other checked baggage is delivered promptly in light of certain changes and circumstances in the industry and at Air Canada. These changes and circumstances include: an increased volume of checked baggage because of security measures and higher load factors; the challenges created for full-service carriers, which offer transfers and interlining, by the regulatory requirement that baggage be carried on the same flight as the passenger who checked such baggage; and the significant complexity in handling animals arising from standards developed by the International Air Transport Association (IATA) that are designed to ensure the safe and humane carriage of animals in aircraft, some elements of which have been included in regulations throughout the world.

[9] Air Canada submits that, for certain carriage, its business plan involves reliance on more frequencies of flights, using smaller aircraft with limited capacity for baggage, and that the carrier is not unique in the air transport industry in refusing to carry animals as checked baggage.

[10] Air Canada asserts that it needs to be attentive to the loading and positioning of animals and their kennels so as to ensure that there is sufficient space around the kennels for ventilation.

[11] Air Canada maintains that carrying animals as cargo rather than checked baggage is preferable because there is no need to co-ordinate the carriage of the cargo shipment with the transportation of the passenger, the pet may be carried on a routing that is not available to passengers, cargo facilities are better equipped with staging areas, and employees of Air Canada's cargo division have considerable experience and training in the carriage of animals.

[12] Air Canada submits that it was conscious that the carriage of animals as cargo to certain destinations would be more expensive than carriage as checked baggage, and that, accordingly, it introduced a new pricing regime applicable to the carriage of animals as cargo between points in Canada, and between Canada and the United States of America. Air Canada maintains that this new regime may mean a slight increase in charges for the carriage of very small animals, but also involves significant savings from the previous regime for the carriage of medium size kennels and mid-size animals. Air Canada notes that its new pricing structure offers prices that are very similar to the prices that would have been assessed to carry an animal as checked baggage. Air Canada anticipates introducing new prices for the carriage of animals as cargo between Canada and countries other than the United States of America during the second quarter of 2008.

[13] With regard to the carriage of animals belonging to passengers who are travelling on Air Canada flights on the ticket of a code-share partner, which accepts animals as checked baggage, Air Canada submits that, whenever possible, it tries to align its policies with those of other Star Alliance carriers. Air Canada maintains that, in situations where alignment does not make good business sense, the policies of the operating carrier apply, and that it is the responsibility of the selling agent or carrier to advise the passenger of the different policies and procedures. Air Canada submits that, provided that there is an indication on the passenger's Passenger Name Record in the Air Canada system that the passenger is travelling with an animal, the carrier will make its best efforts to contact the passenger in advance to communicate its policies.

[14] Mr. Griffiths submits that Air Canada is singling out a very small minority of passengers who travel with animals as being the source of the difficulties in the delivery of baggage. Mr. Griffiths disputes Air Canada's assertion that a reason prompting the discontinuation of the carriage of animals as checked baggage is the higher volume of checked baggage, noting that animals are carried on only a very small number of Air Canada's flights. Mr. Griffiths submits that despite Air Canada's concern regarding baggage management, the carrier continues to allow passengers to check oversized, overweight and excess baggage, such as sports equipment. Mr. Griffiths notes that passengers who arrive at the airport with excess baggage and sports equipment do not provide any notice, yet Air Canada is able to cope with the demand.

[15] Mr. Griffiths maintains that although Air Canada is not the only carrier confronted by higher volumes of baggage, by taking this action, Air Canada has distinguished itself from much of the air transport industry in respect of the carriage of animals. Mr. Griffiths notes that many domestic and international carriers, including members of the Star Alliance, of which Air Canada is a part, transport animals as checked baggage.

[16] Mr. Griffiths submits that the change in status of the carriage of an animal from checked baggage to cargo results in a diminution of priority of such carriage in favour of checked baggage, mail and Air Canada Priority (a premium cargo service) shipments.

[17] Mr. Griffiths notes that Air Canada requires that the shipper of cargo provide the identity of a contact that may be reached on a 24-hour basis. In this regard, Mr. Griffiths maintains that a pet owner, travelling as a passenger, would not be able to be contacted in the event that, because of operational reasons, a pet is not carried as originally scheduled.

[18] Mr. Griffiths submits that, to date, Air Canada has not been strictly enforcing standards developed by IATA relating to the carriage of kennels as checked baggage. Mr. Griffiths notes that his kennel complies with IATA standards, with the exception of the standard requiring that watering and feeding containers in kennels be accessible from the outside, and that, over more than a dozen international round-trips during the last ten years, this kennel has been accepted by Air Canada. Mr. Griffiths advises that Air Canada Cargo Live has indicated to him that his kennel will no longer be accepted for carriage.

[19] Mr. Griffiths maintains that pet owners are further disadvantaged in respect of the availability of customs clearance applicable to checked baggage relative to cargo, and that his recent experience with Air Canada's cargo services has not been reassuring as he has had difficulty contacting carrier personnel and obtaining information.

ANALYSIS

Is Air Canada's proposed discontinuation of the carriage of animals and their kennels weighing less than 70 lbs as checked baggage "unreasonable" within the meaning of subsection 67.2(1) of the CTA and section 111 of the ATR?

[20] To determine whether a term or condition of carriage is "unreasonable" within the meaning of subsection 67.2(1) of the CTA and section 111 of the ATR, a balance must be struck between the rights of the passengers to be subject to reasonable terms and conditions of carriage, and the particular air carrier's statutory, commercial and operational obligations.

[21] To determine whether such balance has been struck in the present case, the Agency must be satisfied that the carriage of animals through Air Canada's cargo services represents a viable alternative for consumers to the extent that such carriage does not entail significant disadvantages for persons travelling with domestic pets.

[22] It is evident that domestic pets are distinct from other shipments in that domestic pets require a higher level of service than that afforded to inanimate shipments, including certainty respecting the delivery of such pets to destination.

[23] Air Canada submits that the carriage of animals as cargo is preferable. However, the carrier acknowledges that baggage, mail and Air Canada Priority receive a higher priority than the carriage of cargo. The Agency finds that the lower priority that is assigned to the carriage of pets as cargo, and the uncertainty of scheduling of cargo, creates difficulties for the pet owner. The Agency finds that the existence of a situation where a pet owner is unsure as to when a pet is to arrive at destination is unreasonable.

[24] Air Canada's proposal to carry pets solely as cargo introduces other conditions of carriage to which the pet owner has not been exposed when carrying a pet as checked baggage. These conditions include the requirement that contact details be provided respecting the consignee or a responsible party who may be reached on a 24-hour basis, and one that provides that, should Air Canada be unable to deliver the shipment within 4 hours of arrival at destination and cannot contact the shipper for instructions, the animal will be placed in a commercial kennel, and the appropriate charges assessed to the shipper. The Agency finds that such conditions are unreasonable because of the difficulty or impossibility associated with contacting a pet owner, who is a passenger of Air Canada. This also applies to the assessment of kennel charges in the event that Air Canada is unable to contact the pet owner to seek instructions because of the late delivery of the pet.

[25] In several cases, where small and medium pets travel with their kennels as cargo, consumers will be subject to prices that are higher than those which would apply if the same pets travelled as checked baggage. The Agency finds that it is unreasonable that such higher prices exist given the level of service provided to persons shipping pets as cargo, particularly when such service creates uncertainty surrounding the carriage of a pet, and imposes inconveniences on the pet owner.

[26] Air Canada requires that, as a condition of acceptance of pets as checked baggage, advance arrangements be made. Such arrangements are not required for certain other checked baggage that is oversized and overweight, such as sports equipment. The Agency finds that the advance notice that Air Canada requires for the carriage of pets affords the carrier the opportunity to manage the carriage of pets as checked baggage, and that it is unreasonable for Air Canada to refuse to carry pets and their kennels weighing under 70 lbs as checked baggage when the carrier is prepared to carry other items of the same weight as checked baggage, some of which is oversized, and does not require prior notice before being accepted.

[27] The Agency finds that, with respect to the carriage of pets and kennels as cargo, an imbalance exists between the interests of Air Canada and consumers in that such carriage creates commercial advantages for the carrier alone, while exposing pet owners to many significant disadvantages. Therefore, the Agency finds that the discontinuation of pets and kennels weighing less than 70 lbs as checked baggage is unreasonable.

What terms and conditions apply to the carriage of pets under a code-sharing arrangement?

[28] With respect to Air Canada's submission that, in a code-sharing arrangement, the terms and conditions of the operating carrier must apply, the Agency finds that this position is inconsistent with Agency decisions relating to applications requesting permission to code share, which decisions include the condition that each carrier involved in the code-sharing transportation apply its published tariff, on file with the Agency and in effect, to the carriage of its traffic.

[29] The Agency reminds Air Canada to align its practices to conform with the conditions established by the Agency for code-sharing arrangements.

CONCLUSION

[30] In view of the foregoing, and to restore the carriage of animals and their kennels weighing less than 70 lbs as checked baggage, the Agency disallows:

1. the tariff provisions that were revised on June 1, 2007, appearing in Air Canada's domestic tariff, and that terminate the carriage of animals and their kennels weighing less than 70 lbs as checked baggage, as being unreasonable. Air Canada is allowed up to thirty (30) days from the date of this Decision to reinstate the carriage of pets and their kennels weighing less than 70 lbs as checked baggage. Air Canada shall advise the Agency when such reinstatement occurs;
2. the tariff provisions that were revised on June 1, 2007, appearing in Air Canada's international tariffs, and that terminate the carriage of animals and their kennels weighing less than 70 lbs as checked baggage, as not being just and reasonable.

Members

• Geoffrey C. Hare
• Raymon J. Kaduck
• John Scott