 

			  UNITED STATES OF AMERICA

		        DEPARTMENT OF TRANSPORTATION

			  OFFICE OF THE SECRETARY

			          WASHINGTON, D.C.

	    Issued by the Department of Transportation on October 1, 2002

NOTICE OF ACTION TAKEN -- DOCKETS OST-2002-13426 & OST-2002-13461

________________________________________________________________________
________________________________________________________

This serves as notice to the public of the action described below, taken
by the Department official indicated (no 

additional confirming order will be issued in this matter).

Applicant:  Volga-Dnepr J.S. Cargo Airline					

Relief requested:  Exemptions pursuant to 49 U.S.C. section 40109(g) to
operate the following cargo charter flights using its AN-124 aircraft: 
(a) one one-way flight from Philadelphia, PA, to Moffet Field, CA, to
transport outsized cargo consisting of a Rainbow Satellite payload and
associated equipment on/about September 28, 2002,  on behalf of Lockheed
Martin Commercial Space Systems (Docket OST-2002-13425, filed September
23, 2002);  and (b) three one-way flights from Denver, CO, to Cape
Canaveral/Skid Strip, FL, October 3-10, 2002, to transport outsized
cargo consisting of a Centaur III upper stage payload, an Atlas and
Centaur launch vehicle payload, and an Atlas V booster payload, on
behalf of Lockheed Martin Astronautics (Docket OST-2002-13461, filed
September 26, 2002).  The applicant stated that Lockheed Martin needed
urgent delivery of the equipment in order to meet a schedule that
requires final assembly of the Rainbow Satellite payload and subsequent
shipment to Cape Canaveral for scheduled initial launch capability and
in order to complete mission integration activities involving the other
equipment and subsequent launch processing.  It also stated that the
cargo is too large for transportation on U.S. carrier aircraft, and that
surface transportation was not feasible because of the time involved,
the delicate nature and high value of the cargo, and conditions
unsuitable to maintaining system integrity compliance. 

Applicant representative:  Glenn Wicks   202-457-7790

Responsive pleadings:  Volga Dnepr served its applications on those U.S.
carriers operating large all-cargo aircraft.  Each carrier indicated
that it did not have aircraft available to conduct the proposed
operations and that it had no comment or did not oppose grant of the
requested authority to Volga-Dnepr.

Statutory Standards:  Under 49 U.S.C. section 40109(g), we may authorize
a foreign air carrier to carry commercial traffic between U.S. points
(i.e., cabotage traffic) under limited circumstances.  Specifically, we
must find that the authority is required in the public interest; that
because of an emergency created by unusual circumstances not arising in
the normal course of business the traffic cannot be accommodated by U.S.
carriers holding certificates under 49 U.S.C. section 41102; that all
possible efforts have been made to place the traffic on U.S. carriers;
and that the transportation is necessary to avoid unreasonable hardship
to the traffic involved (an additional required finding, concerning
emergency transportation during labor disputes, was not relevant here). 
For examples of earlier grants of authority of this type, see, e.g.,
Order 2001-5-23.

	DISPOSITION

Action:  Approved								Action date:  October 1, 2002

Effective dates of authority granted:  October 1-13, 2002

Basis for approval:  We found that the applications met all the relevant
criteria of 49 U.S.C. section 40109(g) for the grant of an exemption of
this type and that the grant was required in the public interest. 
Specifically, we were persuaded that the need to move the cargo promptly
in order to complete scheduled assembly and mission integration
activities and subsequent launch deadlines; the fact that the cargo
could not be transported by surface either in time to meet that schedule
or without the risk of damage; the potential negative impact of delivery
delays; and the unique, outsized nature of the cargo, constituted an
emergency not arising in the normal course of business.  Moreover, based
on the 



Page 2  -  Dockets OST-2002-13426 & OST-2002-13461

representations of the U.S. carriers, we concluded that no U.S. carrier
had aircraft available which could be used to conduct the operations at
issue here.  We also found that grant of Volga-Dnepr’s requests would
prevent undue hardship to the cargo and Lockheed Martin.  Finally, we
found that the applicant was qualified to perform its proposed
operations (see, e.g., Order 94-10-13).

Except to the extent exempted/waived, this authority is subject to our
standard exemption conditions (attached) and to the condition that
Volga-Dnepr comply with an FAA-approved flight routing for the
authorized flights.

Action taken by:   	Read C. Van de Water

			Assistant Secretary for Aviation

			   and International Affairs

An electronic version of this document is available on the World Wide
Web at: 

 http://dms.dot.gov//reports/reports_aviation.asp

												        Appendix A

FOREIGN AIR CARRIER CONDITIONS OF AUTHORITY

In the conduct of the operations authorized, the holder shall:

(1)  Not conduct any operations unless it holds a currently effective
authorization from its homeland for such operations, and it has filed a
copy of such authorization with the Department;

(2)  Comply with all applicable requirements of the Federal Aviation
Administration, including, but not limited to, 14 CFR Parts 129, 91, and
36, and with all applicable U.S. Government requirements concerning
security;

(3)  Comply with the requirements for minimum insurance coverage
contained in 14 CFR Part 205, and, prior to the commencement of any
operations under this authority, file evidence of such coverage, in the
form of a completed OST Form 6411, with the Federal Aviation
Administration’s Program Management Branch (AFS-260), Flight Standards
Service (any changes to, or termination of, insurance also shall be
filed with that office);

(4)  Not operate aircraft under this authority unless it complies with
operational safety requirements at least equivalent to Annex 6 of the
Chicago Convention;

(5)  Conform to the airworthiness and airman competency requirements of
its Government for international air services;

(6)  Except as specifically exempted or otherwise provided for in a
Department Order, comply with the requirements of 14 CFR Part 203,
concerning waiver of Warsaw Convention liability limits and defenses;

(7)  Agree that operations under this authority constitute a waiver of
sovereign immunity, for the purposes of 28 U.S.C. 1605(a), but only with
respect to those actions or proceedings instituted against it in any
court or other tribunal in the United States that are:

   (a)  based on its operations in international air transportation
that, according to the contract of carriage, include a point in the
United States as a point of origin, point of destination, or agreed
stopping place, or for which the contract of carriage was purchased in
the United States; or

   (b)  based on a claim under any international agreement or treaty
cognizable in any court or other tribunal of the United States.

In this condition, the term "international air transportation" means
"international transportation" as defined by the Warsaw Convention,
except that all States shall be considered to be High Contracting
Parties for the purpose of this definition;

(8)  Except as specifically authorized by the Department, originate or
terminate all flights to/from the United States in its homeland;

(9)  Comply with the requirements of 14 CFR Part 217, concerning the
reporting of scheduled, nonscheduled, and charter data;

(10) If charter operations are authorized, except as otherwise provided
in the applicable aviation agreement, comply with the Department's rules
governing charters (including 14 CFR Parts 212 and 380); and

(11) Comply with such other reasonable terms, conditions, and
limitations required by the public interest as may be prescribed by the
Department, with all applicable orders or regulations of other U.S.
agencies and courts, and with all applicable laws of the United States.

This authority shall not be effective during any period when the holder
is not in compliance with the conditions imposed above.  Moreover, this
authority cannot be sold or otherwise transferred without explicit
Department approval under Title 49 of the U.S. Code (formerly the
Federal Aviation Act of 1958, as amended).



 											

U.S. Department of Transportation	

Office of the Secretary of Transportation									        (41301/40109)
7/2002

  The applicant subsequently advised us informally that this flight had
been delayed until on/about October 3, 2002.

