Order No. 2006-A-27

January 17, 2006

File No. M4210/W211-1

Wasaya Airways Limited Partnership, by its General Partner, Wasaya General Partner Limited carrying on business as Wasaya Airways (hereinafter the Licensee) has applied for permission, on a temporary basis, to continue operating a domestic service, all-cargo aircraft, in the absence of a licence. The application was received on December 23, 2005.

Under Licence No. 962523, the Licensee is authorized to operate a domestic service, small aircraft and a domestic service, medium aircraft.

Pursuant to paragraph 57(a) of the Canada Transportation Act, S.C., 1996, c. 10 (hereinafter the CTA), no person shall operate an air service unless, in respect of the service, the person holds a licence issued under the CTA.

Pursuant to section 59 of the CTA, no person shall sell, cause to be sold or publicly offer for sale, in Canada, an air service unless the person holds a licence issued under the CTA in respect of that service.

During a review of the Licensee's files, Agency staff discovered that the Air Operator Certificate of the Licensee indicated that its HS-748 aircraft is authorized for cargo only. As a result, the Licensee requires a licence to operate a domestic service, all-cargo aircraft.

On December 22, 2005, the Licensee advised the Agency that it was unaware of the requirement to hold a licence to operate domestic service, all-cargo aircraft and that it is in the process of completing an application in order that it may operate a domestic service, all-cargo aircraft. In order that its current operations not be interrupted and while its application for a domestic service, all-cargo aircraft, is in process, the Licensee has requested a temporary exemption from the requirement to hold a licence.

Section 80 of the CTA provides:

80.(1) The Agency may, by order, on such terms and conditions as it deems appropriate, exempt a person from the application of any of the provisions of this Part or of a regulation or order made under this Part where the Agency is of the opinion that

(a) the person has substantially complied with the provision;

(b) an action taken by the person is as effective as actual compliance with the provision; or

(c) compliance with the provision by the person is unnecessary, undesirable or impractical.

(2) No exemption shall be granted under subsection (1) that has the effect of relieving a person from any provision of this Part that requires a person to be a Canadian and to have a Canadian aviation document and prescribed liability insurance in respect of an air service.

The Agency has carefully reviewed and considered this matter and finds that in order to continue operating its domestic service, all-cargo aircraft, the Licensee requires an exemption from paragraph 57(a) of the CTA, the requirement to hold a licence, as well as an exemption from the application of section 59 of the CTA, the prohibition to offer for sale, in Canada, an air service in the absence of a licence in respect of that service. In addition, the Agency is of the opinion that there is a demand for the domestic service, all-cargo aircraft, offered by the Licensee and that any operational interruption in its services would be a detriment to both the Licensee and the public. The Agency also finds that the Licensee has been unknowingly operating a domestic service, all-cargo aircraft, without holding the requisite licence authority in contravention of paragraph 57(a) and section 59 of the CTA.

The Agency notes that the Licensee is Canadian and holds Canadian Air Operator Certificate No. 9748 which covers the services being operated. The Licensee also has on file with the Agency a certificate of insurance and the Agency is satisfied that it has the prescribed liability insurance coverage for the operation of domestic services without restriction as to the type of traffic carried.

In light of the above, the Agency is of the opinion that, in the present circumstances, compliance with section 59 and paragraph 57(a) of the CTA is impractical.

Accordingly, the Agency, pursuant to paragraph 80(1)(c) of the CTA, hereby exempts the Licensee from the application of section 59 and paragraph 57(a) of the CTA to allow the Licensee to offer for sale and operate a domestic service, all-cargo aircraft, without holding a licence in respect of that service, until January 31, 2006, subject to the Licensee submitting an application for a licence to operate a domestic service, all-cargo aircraft.

The exemption set out in this Order takes effect as of December 23, 2005, the date on which it was verbally communicated to the Licensee.

With respect to the contraventions set out above, the Licensee should be aware that the Agency considers contraventions of provisions of the CTA to be serious and will take appropriate punitive action should any such contraventions occur in the future. In light of the circumstances of this case, the Agency contemplates no further action in this matter.

Further, the granting of this exemption does not in any way preclude any actions that may be taken against the Licensee pursuant to the Canadian Transportation Agency Designated Provisions Regulations, SOR/99-244.