Decision No. 476-A-2012

APPLICATION

Caribbean Airlines Limited carrying on business as Air Jamaica (Caribbean Airlines), on behalf of itself and Omni Air International, Inc. also carrying on business as Omni Air Express (Omni Air), has applied to the Canadian Transportation Agency (Agency) for an approval to permit Caribbean Airlines to provide its scheduled international service between Trinidad and Tobago and Canada using aircraft and flight crew provided by Omni Air, from December 16, 2012 to January 8, 2013, excluding January 1, 2013.

Caribbean Airlines is licensed to operate a scheduled international service in accordance with the Agreement between the Government of the Republic of Trinidad and Tobago and the Government of Canada on Air Services, initialled ad referendum on July 20, 1988.

EXEMPTION REQUESTED

Caribbean Airlines 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.

In Decision No. 426-A-2012 dated November 7, 2012, the Agency advised that the 45-day filing requirement will be strictly enforced for any new applications made after the date of issuance of that Decision, unless the applicant can demonstrate for a wet lease resulted from an unexpected or unforeseeable situation.

The Agency notes that the wet-lease agreement between Caribbean Airlines and Omni Air was signed on September 21, 2012, and the application was filed on November 21, 2012, prior to the date of publication of Decision No. 426-A-2012. Therefore, the Agency will not enforce the filing time requirement in this case.

The Agency has considered the matter and 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 Caribbean Airlines from the application of subsection 8.2(2) of the ATR.

WET-LEASE APPLICATION

In Decision No. 426-A-2012, the Agency found that the issues raised in Sunwing Airlines Inc.’s application for a wet lease suggest that it would be both timely and beneficial to clarify the Agency’s approach to wet-lease applications. In that regard, the Agency advised that it will initiate a consultation to seek the views of the industry and other interested parties regarding the intent of the wet-lease approval requirements. This consultation would include information required by the Agency for its assessment of necessity under paragraph 8.2(3)(j) of the ATR.

The Agency also ruled that until it provides further clarification on wet-lease application requirements, the current approach will be maintained.

The Agency notes that Caribbean Airlines provided an explanation for the wet-lease application; however, as set out in Decision No. 426-A-2012, the Agency will continue with its current approach until it has conducted a consultation. Following its consultation, the Agency will establish specific criteria that will apply in the future.

The Agency is satisfied that the application meets the remaining requirements of section 8.2 of the ATR.

Accordingly, the Agency, pursuant to paragraph 60(1)(b) of the CTA and section 8.2 of the ATR, approves the use by Caribbean Airlines of aircraft and flight crew provided by Omni Air, and the provision by Omni Air of such aircraft and flight crew to Caribbean Airlines, to permit Caribbean Airlines to provide its scheduled international service on licensed routes between Trinidad and Tobago and Canada using aircraft and flight crew provided by Omni Air, from December 16, 2012 to January 8, 2013, excluding January 1, 2013.

This approval is subject to the following conditions:

1. Caribbean Airlines shall continue to hold the valid licence authority.
2. Commercial control of the flights shall be maintained by Caribbean Airlines. Omni Air shall maintain operational control of the flights and shall receive payment based on the rental of aircraft and crew and not on the basis of the volume of traffic carried or other revenue-sharing formula.
3. Caribbean Airlines and Omni Air 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.
4. Caribbean Airlines shall continue to comply with the public disclosure requirements set out in section 8.5 of the ATR.
5. Caribbean Airlines and Omni Air shall advise the Agency in advance of any changes to the information provided in support of the application.

FUTURE REQUESTS

Caribbean Airlines is reminded that in any future application for a wet lease, it must provide an explanation, as required by paragraph 8.2(3)(j) of the ATR. Further, the Agency will continue to enforce the requirement to file such applications 45 days in advance. In this regard, the exemption granted in this Decision should not be relied upon for any future requests for an exemption.