Order No. 2012-A-68

China Airlines Limited carrying on business as China Airlines (China Airlines) has applied to the Canadian Transportation Agency (Agency) for an exemption to permit it to sell, cause to be sold or publicly offer for sale in Canada a scheduled international service between Taipei and Canada, in the absence of a licence.

Section 59 of the Canada Transportation Act (CTA) states that no person shall sell, cause to be sold or publicly offer for sale in Canada an air service unless, if required under Part II of the CTA, a person holds a licence issued under that Part in respect of that service and that licence is not suspended.

China Airlines is licensed to operate a scheduled international service in a manner consistent with the Supplementary Confidential Memorandum on Air Services between the Canadian Trade Office in Taipei and the Civil Aeronautics Administration of the Ministry of Transportation and Communications in Taipei signed on February 25, 1999, as amended.

Condition No. 3 of the licence states:

This licence shall terminate on March 31, 2012.

The extension of the validity period of the licence is subject to approval by the Agency, on application.

China Airlines is requesting this exemption to allow it to sell seats beyond the termination date of its licence.

The Agency deals with applications for exemptions from the application of section 59 of the CTA on a case by case basis. The Agency recognizes that section 59 is a consumer protection measure. It is intended to prevent situations in which consumers in Canada pay for a service to an entity that does not hold an Agency licence and are left out of pocket or experience any manner of inconvenience or hardship that may result if that entity does not commence operations on schedule.

Accordingly, the Agency, prior to granting an exemption from the application of section 59 of the CTA, must be satisfied that the applicant is taking all the necessary steps to meet all licence issuance requirements and that the licence will be issued prior to the proposed start of operations.

In this case, China Airlines meets the requirements to hold a licence to operate a scheduled international service between Taipei and Canada, and has confirmed its intent to file an application to extend the validity period of its licence beyond March 31, 2012.

The Agency finds that an exemption from the application of section 59 of the CTA is appropriate in the circumstances.

Accordingly, the Agency, pursuant to paragraph 80(1)(c) of the CTA, exempts China Airlines from the application of section 59 of the CTA, effective from the date of this Order, permitting it to sell, cause to be sold or publicly offer for sale in Canada a scheduled international service between Taipei and Canada, for travel beyond the termination date of its licence.

This exemption is subject to the following conditions:

1. The exemption does not relieve China Airlines from the requirement to hold a licence in respect of the service to be provided and, accordingly, no flight shall be operated if the appropriate licence authority has not been granted and is not in effect as at the date of any flight.
2. Should China Airlines, pursuant to this exemption order, sell seats on flights requiring the extension of the validity period of the current licence or an alternative licence and the extension has not been approved or the alternative licence has not been granted as at the date of any applicable flight, China Airlines shall arrange to provide alternative air transportation by an appropriately licensed air carrier, at no additional costs for all passengers who have made reservations with China Airlines. If such arrangements are not possible or acceptable to the passenger, China Airlines shall arrange to provide a full refund of all monies paid by the passenger.

This exemption will be automatically revoked should China Airlines cease to hold a valid licence for this service.