Decision No. 442-A-2010

October 26, 2010

File No. M4835-2-30

Air Canada, on behalf of itself and Korean Air Lines Co. Ltd. (Korean Air), has applied to the Canadian Transportation Agency (Agency) for an approval topermitAir Canadato provide its all-cargo scheduled international service betweenCanadaandKoreaby selling transportation in its own name on flightsoperated by Korean Air for a period of three years commencing on November 1, 2010.

Air Canada is licensed to operate an all‑cargo scheduled international service in accordance with the Agreement between the Government of Canada and the Government of the Republic of Korea on Air Transport, initialled ad referendum on June 3, 2009(Agreement).

The Agency has considered the application and the material in support and is satisfied that it meets the requirementsof section 8.2 of the Air Transportation Regulations(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 Canada Transportation Act (CTA) and section 8.2 of the ATR, approves the use by Air Canada of aircraft and flight crew provided by Korean Air, and the provision by Korean Air of such aircraft and flight crew to Air Canada, to permit Air Canada to provide its all-cargo scheduled international service on licensed routes between Canada and Korea by selling transportation in its own name on flights operated by Korean Air from November 1, 2010 to October 31, 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 shippers as stated in such tariffs.
3. The air service approved shall only be provided as long as acommercial agreementproviding for such service remains in effect.
4. Air CanadaandKorean Airshall 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 Canada and Korean Air shall provide the Agency with a copy of any new agreement or amendments to theircommercial agreement, including any new or amended annex, without delay.

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

Members

• Raymon J. Kaduck
• Jean-Denis Pelletier, P. Eng.