Decision No. 31-A-2010

February 4, 2010

File No. M4835-2-28

Air Canada, on behalf of itself and United Air Lines, Inc. (United), has applied to the Canadian Transportation Agency (Agency) for approvals to permit:

1. Air Canada to provide its scheduled international services between Canada and Member States of the European Community (Member States) by selling transportation in its own name on flights operated by United; and
2. United to provide its scheduled international services between the United States of America and Member States by selling transportation in its own name on flights operated by Air Canada.

It is noted that the Agency granted an indefinite approval to Air Canada to code share by using aircraft and flight crew provided by United and United Express carriers between points in Canada and points in the United States of America and granted an indefinite approval to United to code share by using aircraft and flight crew provided by Air Canada and Jazz Air LP, as represented by its general partner, Jazz Air Holding GP Inc. carrying on business as Air Canada Jazz, Jazz and Jazz Air between points in the United States of America and points in Canada. These approvals were granted in Decision No. 689-A-2000, varied by Decision No. 196-A-2008, and in Decision No. 205-A-2002, Decision No. 731-A-2005, Decision No. 732-A-2005 and Decision No. 548-A-2007.

The approvals requested would allow Air Canada to provide additional services between Canada and Member States by code sharing and would allow United to provide additional services between the United States of America and Member States by code sharing.

Air Canada is licensed to operate a scheduled international service in accordance with the Agreement on Air Transport between Canada and the European Community and its Member States signed on December 18, 2009 (Canada-European Community Agreement).

Under the terms of the Canada-European Community Agreement, code sharing between the designated carriers and third-country carriers is permitted. That is, while providing services between Canada and Member States, the designated carriers may code share on each other's flights, including flights operated via third countries.

Air Canada is licensed to operate a scheduled international service between Canada and the United States of America and beyond to third countries in accordance with the Air Transport Agreement between the Government of Canada and the Government of the United States of America signed on March 12, 2007 (Canada-United States Agreement).

United is licensed to operate a scheduled international service between Canada and the United States of America in accordance with the Canada-United States Agreement. United is also authorized to provide services beyond Canada to, among others, points in Member States with traffic rights.

The Agency has reviewed and considered the application and the material in support and is satisfied that it meets the requirements of section 8.2 of the Air Transportation Regulations (ATR).

With respect to the duration of the approvals requested, the Agency has considered this matter and finds it appropriate to grant the approvals for three years only at this time.

Accordingly, the Agency, pursuant to paragraph 60(1)(b) of the Canada Transportation Act and section 8.2 of the ATR, approves the use by Air Canada of aircraft and flight crew provided by United, and the provision by United of such aircraft and flight crew to Air Canada, to permit Air Canada to provide its scheduled international services on licensed routes between Canada and Member States, by selling transportation in its own name on flights operated by United.

In addition, the Agency approves the use by United of aircraft and flight crew provided by Air Canada, and the provision by Air Canada of such aircraft and flight crew to United, to permit United to provide its scheduled international services between the United States of America and Member States by selling transportation in its own name on flights operated by Air Canada.

These approvals are granted for a period of three years from the date of this Decision, subject to the following conditions:

1. Air Canada and United shall continue to hold the required licence authorities.
2. Each of Air Canada and United shall apply its published tariffs, in effect, to the carriage of its traffic. Nothing in any commercial agreement between the air carriers relating to limits of liability shall diminish the rights of passengers as stated in such tariffs.
3. The air services approved shall only be provided as long as a code-sharing agreement providing for such services remains in effect.

Air Canada and United are reminded of the continuing requirement to comply with sections 8.2 and 8.5 of the ATR.

Air Canada and United are further reminded to provide the Agency with a copy of any new agreement or amendments to their commercial agreement, including any new or amended annex, without delay.

These approvals do not exempt Air Canada and United from the requirements of other legislative acts or regulations, including those of Transport Canada.

Members

• John Scott
• J. Mark MacKeigan