Order No. 2007-A-172

May 29, 2007

File No. M4210/A74-4-65

Air Canada has applied to the Canadian Transportation Agency (hereinafter the Agency) for the exemption set out in the title. The application was received on April 27, 2007.

Section 59 of the Canada Transportation Act (hereinafter the CTA) states 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 CTA, the person holds a licence under that part in respect of that service.

Under Licence No. 030161, Air Canada is authorized to operate a scheduled international service, medium aircraft, and a scheduled international service, large aircraft, between Canada and Grenada.

Condition No. 2 of the said licence states:

Unless terminated at an earlier date in accordance with the CTA, this licence shall terminate on October 31, 2007.

Air Canada states that compliance with section 59 of the CTA is undesirable if the travelling public is to be able to take advantage of its service without interruption between Canada and Grenada.

The Agency has carefully reviewed and considered the application and is of the opinion that in order for the service to be viable, Air Canada must be able to continue selling seats without interruption. Therefore, the Agency finds that compliance by Air Canada with section 59 of the CTA is impractical in the present circumstances.

Accordingly, the Agency, pursuant to paragraph 80(1)(c) of the CTA, hereby exempts Air Canada from the application of section 59 of the CTA, effective from the date of this Order, thereby permitting Air Canada to sell, cause to be sold or publicly offer for sale in Canada a scheduled international service, medium aircraft, and a scheduled international service, large aircraft, between Canada and Grenada for travel beyond October 31, 2007, without holding the required licence, subject to the following conditions:

1. The exemption authorized herein does not relieve Air Canada from the requirement to hold a licence in respect of the service to be provided and, accordingly, no flights shall be operated until the appropriate licence authority has been granted.
2. Should the scheduled international licence not issue by October 31, 2007, Air Canada shall arrange to provide alternative air transportation by an appropriately licensed air carrier, at no additional cost for all passengers who have made reservations with Air Canada or, if such arrangements are not possible or acceptable to the passenger, to provide a full refund of all monies paid by the passenger.

The exemption authorized herein is valid until October 31, 2007.

The exemption granted herein does not exempt Air Canada from the requirements of other legislative acts or regulations, including those of Transport Canada.