Decision No. 624-A-2007

December 11, 2007

File No. M4835-2-28

Air Canada, on behalf of itself and United Air Lines, Inc. (hereinafter United), has applied to the Canadian Transportation Agency (hereinafter the Agency) for the approval set out in the title. The application was received on November 16, 2007.

Air Canada has also requested an exemption from the application of subsection 8.2(2) of the Air Transportation Regulations (hereinafter the ATR), which requires the filing of an application for an approval at least 45 days before the first planned flight.

The Agency notes that this application is a renewal of the approval granted by Decision No. 654-A-2004 dated December 3, 2004.

Under Licence No. 040135, Air Canada is authorized to operate a scheduled international service in accordance with the Agreement between the Government of Canada and the Government of the Socialist Republic of Vietnam on Air Transport, signed ad referendum on September 28, 2004 (hereinafter the Agreement).

Under the terms of the Agreement, code sharing between designated airlines and third-country carriers is permitted. That is, while providing services between Canada and Vietnam, the designated airlines may code share on each other's flights, or on flights operated by a carrier of a third country.

With respect to the request for an exemption from the application of subsection 8.2(2) of the ATR, the Agency has considered the request and is of the opinion that compliance by Air Canada 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 (hereinafter the CTA), hereby orders that Air Canada be exempt from the application of subsection 8.2(2) of the ATR.

The Agency has reviewed and considered the application and the material filed in support thereof 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 that a period of three years would be appropriate.

Accordingly, the Agency, pursuant to paragraph 60(1)(b) of the CTA and section 8.2 of the ATR, hereby 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 service on licensed routes between Canada and Vietnam by selling transportation in its own name on flights operated by United between Hong Kong and Ho Chi Minh City, from December 12, 2007 to December 11, 2010, subject to the following conditions:

1. Air Canada shall continue to hold the required licence authority.
2. Air Canada shall apply its published tariffs, in effect, to the carriage of its traffic. In particular, 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 herein shall only be provided as long as a commercial agreement providing for such services remains in effect.
4. Air transportation using Air Canada's code on flights operated by United between Hong Kong and Ho Chi Minh City 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 Vietnam. No local traffic may be carried under Air Canada's code between Hong Kong and Ho Chi Minh City.

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.

The approval granted herein does not exempt Air Canada and United from the requirements of other legislative acts or regulations, including those of Transport Canada.

Members

• Raymon J. Kaduck
• J. Mark MacKeigan