Decision No. 384-A-2016

APPLICATION

Swift Air L.L.C. carrying on business as Swift Air (Swift Air) applied to the Canadian Transportation Agency (Agency) for the necessary authority to operate one Canadian originating entity passenger charter flight from Hamilton, Ontario, Canada to Nassau, Bahamas, departing December 26, 2016 and returning January 2, 2017, using a Boeing 737-300/110 seat aircraft (12 seats in first class and 98 seats in economy class), on behalf of Air Charter Service (Canada) Corp. acting as an agent for its client.

Swift Air is licensed to operate 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).

On December 15, 2016, the Agency requested comments from, among others, Canadian air carriers licensed to operate non-scheduled international services, large aircraft. The Agency’s notice stated that comments on the application should address only the issues of comity and reciprocity.

On December 20, 2016, Les Investissements Nolinor Inc. carrying on business as Nolinor Aviation et/and Nolinor (Nolinor) filed an intervention opposing the granting of the application. On December 20, 2016, Swift Air replied to the intervention.

ANALYSIS AND FINDINGS

Pursuant to subsection 74(1) of the Canada Transportation Act, S.C., 1996, c. 10, as amended (CTA), the Agency may make a non-scheduled international licence subject, in addition to any terms and conditions prescribed in respect of the licence, to such terms and conditions as the Agency deems appropriate, including terms and conditions respecting points or areas to be served.

Paragraphs 22(b) and (c) of the Air Transportation Regulations, SOR/88-58, as amended (ATR) provide that the issuance of permits by the Agency in respect of an international charter is subject to the conditions that the operation of the charter be consistent with, among other things, Canada’s international transportation policies and be in accordance with any applicable international agreement to which Canada is a party.

Subsection 78(1) of the CTA states that the powers conferred on the Agency by Part II of the CTA shall be exercised in accordance with any international agreement, convention or arrangement relating to civil aviation to which Canada is a party.

The Agency notes Section 1, paragraph C of Annex III to the Agreement which provides that each party shall extend favourable consideration to applications by airlines of the other party to carry traffic not covered by the Annex on the basis of comity and reciprocity. In addition, Article 5 of the Agreement precludes the imposition by aeronautical authorities of an uplift ratio or the right of a first refusal to national carriers.

In its intervention, Nolinor submits that there are other Canadian carriers that can handle that traffic and their continued activity depend on such commercial traffic. Nolinor states that it has a Boeing 737-300 (130 seats, all economy class) available on those dates and capable of doing this flight and that the need for a carrier from the United States of America is not justified. Nolinor adds that it would not be in the public interest to allow the carriage of other commercial traffic with the arrangement proposed.

The Agency notes that Nolinor has not provided evidence that it, or any other Canadian air carrier, has been denied authority to operate similar charter flights between the United States of America and third countries.

The Agency finds, in this case, that in the absence of evidence of a lack of reciprocity of treatment of Canadian air carrier applications for similar authority from the aeronautical authorities of the United States of America, a denial of Swift Air’s request would be contrary to the Agreement.

CONCLUSION

In light of the above, and considering all the circumstances of this case, the Agency, pursuant to paragraph 80(1)(c) of the CTA, orders that Swift Air be exempt from the application of subparagraph 34(1)(a)(ii) of the ATR, i.e., the filing time requirement. Also, the Agency pursuant to subsection 74(1) of the CTA, deems it appropriate to add the following condition to Swift Air’s Licence:

The Licensee is authorized to operate one Canadian originating entity passenger charter flight, using a Boeing 737‑300/110 seat aircraft, on behalf of Air Charter Service (Canada) Corp., acting as an agent for its client, from Hamilton, Ontario, Canada to Nassau, Bahamas, departing December 26, 2016 and returning January 2, 2017. Program Permit Number 2016-58-CEPF refers.

This Decision takes effect on December 22, 2016, the date on which it was verbally communicated to both parties.