Decision No. 654-A-2004

December 3, 2004

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 October 26, 2004.

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

With respect to the request for an approval for a three (3) year or longer period, the Agency notes that the Agreement permits the proposed code-sharing services, subject to regulatory requirements. In this circumstance, an approval for a period of three (3) years would be consistent with Agency practice.

The Agency has reviewed and considered the application and the material filed in support thereof and is satisfied that it meets the requirements set out in section 8.2 of the Air Transportation Regulations (hereinafter the ATR).

Accordingly, the Agency, pursuant to paragraph 60(1)(b) of the Canada Transportation Act (hereinafter 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 air 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, Vietnam. This approval is granted from December 10, 2004 to December 11, 2007 and is subject to the following conditions:

1. Air Canada shall continue to hold the required licence authority.
2. Air Canada shall apply its published tariffs, on file with the Agency and in effect, to the carriage of its traffic. In particular, nothing in any commercial agreement between the 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 between Air Canada and United, on file with the Agency and providing for such services, remains in effect.
4. Air transportation using Air Canada's code on United's flights between Hong Kong and Ho Chi Minh City shall be available only as part of a continuous journey without stopovers 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 also reminded of the continuing requirement to comply with sections 8.2 and 8.5 of the ATR.

Air Canada and United are further reminded of the requirement 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 authority granted herein does not exempt Air Canada and United from the requirements of other legislative acts or regulations, including those of Transport Canada.