Order No. 2010-A-634

December 10, 2010

File Nos. M4211/A975-2
M4211/A975-3

Astar Air Cargo, Inc. (Astar) applied to the Canadian Transportation Agency (Agency) for an exemption to allow for the transfer of its licences to Astar USA, LLC (AUSA).

Under Licence No. 977271, Astar is authorized to operate cargo charter flights in accordance with Annex III of the Air Transport Agreement between the Government of Canada and the Government of the United States of America signed on March 12, 2007 (Agreement).

Under Licence No. 961006, Astar is authorized to operate a scheduled international service on Route A2 set out in Section 1 of Annex I of the Agreement.

Section 58 of the Canada Transportation Act (CTA) provides that a licence issued for the operation of an air service is not transferable.

Pursuant to paragraph 80(1)(c) of the CTA, the Agency may exempt a person from the application of a provision of the CTA where it is of the opinion that compliance with the provision by the person is unnecessary, undesirable or impractical.

In its request, Astar submits that, in the context of a corporate reorganization begun by its parent company, Astar has established a new wholly-owned subsidiary under the Laws of the State of Delaware under the name of Astar USA, LLC.

Astar states that pursuant to a merger agreement between Astar and AUSA, Astar will merge with and into AUSA with AUSA being the surviving entity. Astar also states that upon completion of the merger, AUSA will conduct the entirety of Astar's flight operations. Astar indicates that it is implementing this corporate reorganization to position itself as a more attractive commercial vendor for DHL Express (USA), Inc., Astar's largest and most important customer with whom Astar has had a long established commercial relationship and association.

The Agency reviewed all submissions filed and is satisfied that the proposed corporate reorganization from a corporation to a limited liability company is in the nature of an internal restructuring.

The Agency is therefore of the opinion that compliance by Astar with section 58 of the CTA is impractical in the present circumstances.

Accordingly, the Agency, pursuant to paragraph 80(1)(c) of the CTA, exempts Astar from the application of section 58 of the CTA.

The Agency is satisfied that AUSA meets the requirements of paragraph 69(1)(a) and subsection 73(2) of the CTA.

In light of the above, Licence Nos. 977271 and 961006 are transferred from Astar Air Cargo, Inc. to Astar USA, LLC.

New documents of licence will be issued.