Decision No. 423-A-2010

October 18, 2010

File No. M4835-2-5

Air Canada, on behalf of itself and Deutsche Lufthansa Aktiengesellschaft (Lufthansa German Airlines) [Lufthansa] and its affiliates and subsidiaries, has applied to the Canadian Transportation Agency (Agency) for an approval to permit Air Canada to provide its scheduled international service between Canada and Ethiopia by selling transportation in its own name on flights operated by Lufthansa and its affiliates and subsidiaries between points in Germany and a point in Ethiopia, for such period as may be authorized by the Agency, commencing on October 31, 2010.

Air Canada has also requested an exemption from the application of subsection 8.2(2) of the Air Transportation Regulations (ATR), which requires the filing of an application for an approval at least 45 days before the first planned flight. The Agency finds that compliance with subsection 8.2(2) of the ATR is impractical in this case. Accordingly, the Agency, pursuant to paragraph 80(1)(c) of the Canada Transportation Act (CTA), exempts Air Canada from the application of subsection 8.2(2) of the ATR.

Air Canada is licensed to operate a scheduled international service in accordance with the Agreement between the Government of Canada and the Government of the Federal Democratic Republic of Ethiopia on Air Transport, initialled ad referendum on January 14, 2010 (Agreement).

The Agency has considered the application and the material in support and is satisfied that it meets the remaining requirements of section 8.2 of the ATR.

With respect to the duration of the approval requested, in light of the provisions of the Agreement, the Agency considers three years to be appropriate.

Accordingly, the Agency, pursuant to paragraph 60(1)(b) of the CTA and section 8.2 of the ATR, approves the use by Air Canada of aircraft and flight crew provided by Lufthansa and its affiliates and subsidiaries, and the provision by Lufthansa and its affiliates and subsidiaries of such aircraft and flight crew to Air Canada, to permit Air Canada to provide its scheduled international service on licensed routes between Canada and Ethiopia by selling transportation in its own name on flights operated by Lufthansa and its affiliates and subsidiaries between points in Germany and a point in Ethiopia, from October 31, 2010 to October 30, 2013.

This approval is subject to the following conditions:

1. Air Canada shall continue to hold the valid licence authority.
2. Air Canada 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 service approved shall only be provided as long as a code-sharing agreement providing for such service remains in effect.
4. Air Canada and Lufthansa and its affiliates and subsidiaries shall continue to comply with the insurance requirements set out in subsections 8.2(4), 8.2(5) and 8.2(6) of the ATR.
5. Air Canada shall continue to comply with the public disclosure requirements set out in section 8.5 of the ATR.
6. Air transportation using Air Canada's code on flights operated by Lufthansa and its affiliates and subsidiaries between Germany and Ethiopia shall not be sold separately and shall only be available to traffic carried on a continuous journey under Air Canada's code between Canada and Ethiopia.
7. Air Canada and Lufthansa shall provide the Agency with a copy of any new agreement or amendments to their code-sharing agreement, including any new or amended annex, without delay.

This approval does not exempt Air Canada and Lufthansa and its affiliates and subsidiaries from the requirements of other legislative acts or regulations, including those of Transport Canada.

Members

• John Scott
• Jean-Denis Pelletier, P. Eng.