Decision No. 669-A-2003

December 3, 2003

File No. M4835-2-26

Docket No. 031443AG

Air Canada, on behalf of itself and Austrian Airlines, has applied to the Canadian Transportation Agency (hereinafter the Agency) for the approval set out in the title. The application was received on November 27, 2003.

Under Licence Nos. 975040 and 985002, Air Canada and Austrian Airlines are respectively authorized to operate scheduled international services, in accordance with the Agreement between the Government of Canada and the Austrian Federal Government on Air Transport, signed on June 22, 1993 (hereinafter the Agreement).

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.

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 notes that, under the terms of the Agreement, designated air carriers are permitted to offer services through codesharing with other air carriers, including air services via third countries.

The Agency notes that this application is for renewal of the approvals granted by the following Decisions:

By Decision No. 607-A-2001 dated November 20, 2001, Austrian Airlines is authorized to codeshare on Air Canada's flights between Montréal, Toronto or Ottawa, Canada and Vienna, Austria until December 2, 2003.

By Decision No. 50-A-2002 dated January 29, 2002, Air Canada is authorized to codeshare on Austrian Airlines' flights between London, United Kingdom and Vienna, Austria and between Frankfurt, Germany and Vienna, Austria until December 2, 2003. In addition, Austrian Airlines is authorized to codeshare on Air Canada's flights between Vancouver and Calgary, Canada and London, United Kingdom until December 2, 2003.

By Decision No. 91-A-2002 dated February 26, 2002, Air Canada is authorized to codeshare on Austrian Airlines' flights between Montréal, Canada and Vienna, Austria until December 2, 2003. In addition, Austrian Airlines is authorized to codeshare on flights operated by Air Canada and its affiliate between domestic points in Canada until December 2, 2003.

By Decision No. 423-A-2002 dated July 30, 2002, Air Canada is authorized to codeshare on flights operated by Austrian Airlines and its affiliates between domestic points in Austria until December 2, 2003.

By Decision No. 509-A-2002 dated September 11, 2002, Austrian Airlines is authorized to codeshare on flights operated by Air Canada and its affiliates between points in Canada and points in the United States of America until December 2, 2003.

By Decision No. 172-A-2003 dated March 27, 2003, Austrian Airlines is authorized to codeshare on Air Canada's flights between Calgary, Canada and Frankfurt, Germany, between Toronto, Canada and Munich, Germany and between Halifax, Montréal and St. John's, Canada and London, United Kingdom until December 3, 2003.

By Decision No. 259-A-2003 dated May 13, 2003, Air Canada is authorized to codeshare on Austrian Airlines' flights between Toronto, Canada and Vienna, Austria until December 2, 2003.

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

With respect to the duration of the subject approval, Air Canada has requested that it be approved for a period of three years or such longer period as may be approved by the Agency. In this case, the Agency considers it appropriate to grant the subject application until December 2, 2006.

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 Austrian Airlines and its affiliates, and the provision by Austrian Airlines of such aircraft and flight crew to Air Canada, to permit Air Canada, while providing its scheduled international air service between Canada and Austria, to sell transportation in its own name on flights operated by Austrian Airlines and its affiliates between points in Canada and points in Austria including segments between intermediate points and points in Austria; and between domestic points in Austria.

In addition, the Agency approved the use by Austrian Airlines of aircraft and flight crew provided by Air Canada and its affiliates, and the provision by Air Canada of such aircraft and flight crew to Austrian Airlines, to permit Austrian Airlines, while providing its scheduled international air service between Austria and Canada, to sell transportation in its own name on flights operated by Air Canada and its affiliates between points in Canada and points in Austria including segments between intermediate points and points in Canada; between domestic points in Canada; and between points in Canada and points in the United States of America.

These approvals are granted from December 3, 2003 to December 2, 2006, subject to the following conditions:

1. Air Canada and Austrian Airlines shall continue to hold the required licence authorities.
2. Air transportation using Austrian Airlines' code on flights operated by Air Canada or its affiliates on segments between intermediate points and points in Canada; between domestic points in Canada; and between points in Canada and points in the United States of America, shall not be sold separately and shall only be available to Austrian Airlines' traffic carried on a continuous journey to and from Austria.
3. Air transportation using Air Canada's code on flights operated by Austrian Airlines or its affiliates on segments between intermediate points and points in Austria and between domestic points in Austria shall not be sold separately and shall only be available to Air Canada's traffic carried on a continuous journey between Canada and Austria.
4. Air Canada and Austrian Airlines shall each apply their published tariffs, on file with the Agency and in effect, to the carriage of their 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.
5. The air services approved herein shall only be provided as long as a code-sharing agreement between Air Canada and Austrian Airlines providing for such services remains in effect.

Air Canada and Austrian Airlines are reminded of the requirement to provide the Agency with a copy of any new or amended annexes and/or appendices to the code-share agreement.

Air Canada and Austrian Airlines are reminded to advise the Agency in advance of any changes to the information provided in support of the subject application.

Air Canada and Austrian Airlines are further reminded of the continuing requirement to comply with sections 8.2 and 8.5 of the ATR.

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