 

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, DC

Issued by the Department of Transportation on October 10, 2003

   NOTICE OF ACTION TAKEN -- DOCKET OST-2003-15946           

________________________________________________________________________
_________________________________

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).

Joint Application of   US Airways, Inc.  and Deutsche Lufthansa AG
(Lufthansa)   filed   8/13/03  for:

XX  Exemption for US Airways under 49 U.S.C. 40109 to provide the
following service:

Scheduled foreign air transportation of persons, property, and mail
between any point or points in the United States, and any point or
points in Germany, directly and via intermediate points, and beyond
Germany to any point or points in third countries, and to integrate this
authority with US Airways’ existing certificate and exemption
authority.  US Airways further requests any necessary exemption
authority (including the right to integrate such authority with its
existing certificates and exemptions) in order to engage in code-sharing
arrangements with Lufthansa.  

XX  Statement of authorization for US Airways under CFR Part 212 to:

Permit US Airways to display the “LH” code of Lufthansa on flights
operated by US Airways between (1) any point in the United States and
any point in Germany (either nonstop or via third-country points); (2)
any points in the United States in conjunction with services held out by
Lufthansa between Germany and the United States (either nonstop or via
third-country points); and (3) any point in the United States and any
point beyond the United States.

XX  Statement of authorization for Lufthansa under 14 CFR Part 212 to:

Permit Lufthansa to display the “US” code of US Airways on flights
operated by Lufthansa between (1) any point or points in Germany and any
points in the United States (either nonstop or via third-country
points); (2) any points in Germany in conjunction with services held out
by US Airways between the United States and Germany (either nonstop or
via-third-country points); and (3) any point in Germany and any point
beyond Germany. 

Applicant reps: John P. Schmitz (202) 263-3000 (US Airways) DOT Analyst:
 Sylvia Moore  (202) 366-6519

                          Ali M. Stoeppelwerth (202) 663-6000
(Lufthansa)

(See Reverse Side)

2

D I S P O S I T I O N

XX   Granted, in part, US Airways’ request for exemption authority
(See Remarks)

XX   Deferred on US Airways’ exemption to the extent it requests
authority to serve points

         pending security clearances

XX  Granted, in part the US Airways and Lufthansa statements of
authorization (subject to

         conditions, see below)

XX  Deferred on the statements of authorization to the extent they
involve authority to points

        pending security clearances.

The above action with respect to US Airways’ exemption authority was
effective when taken: October 10, 2003, through   October 10, 2005

The statements of authorization granted were effective when taken:   
October 10, 2003, and will remain in effect indefinitely, subject to the
conditions listed below.

Action taken by:   Paul L. Gretch, Director	

		    Office of International Aviation

XX  The authority granted is consistent with the aviation agreement
between the United States and Germany.

Except to the extent exempted or waived, this authority is subject to
the terms, conditions, and limitations indicated:  XX US Airways’
certificates of public convenience and necessity 

	   XX  Lufthansa’s foreign air carrier permit      

	   XX  Standard exemption conditions (Attachment B)

______________________

Remarks:  In a letter dated August 26, 2003, Counsel for US Airways
informed the Departments that US Airways would soon schedule a
code-share safety audit of Lufthansa CityLine, consistent with the
provisions of the Department’s Code Share Safety Program, and would
provide the results of that audit to the Federal Aviation
Administration.  Since US Airways has not yet conducted a safety audit
of Lufthansa

CityLine, we will limit the authority granted to Lufthansa and its
CityLine affiliate in the above statement of authorization so as not to
permit the carriage on City Line of any U.S. Airways’ traffic.  We
will defer action on the application to the extent that Lufthansa
CityLine seeks to carry code-share traffic of US Airways.

US Airways and Lufthansa have listed various foreign points they
initially propose to serve in connection with their reciprocal
code-sharing arrangement pursuant to their requested statements of
authorization.  We are deferring action on US Airways’ and
Lufthansa’s requests to operate code-share services involving those
points in Appendix A marked with an asterisk, and deferring action on US
Airways’ exemption request to serve those points pending receipt of
the necessary security clearances.

Conditions: The route integration authority granted is subject to the
condition that any service provided under this exemption shall be
consistent with all applicable agreements between the United States and
the foreign countries involved.  Furthermore, (a) nothing in the award
of the route integration authority requested should be construed as
conferring upon US Airways rights (including fifth-freedom intermediate
and/or beyond rights) to serve markets where U.S. carrier entry is
limited unless US Airways notifies the Department of its intent to serve
such a market and unless and until the Department has completed any
necessary carrier selection procedures to determine which carriers(s)
should be authorized to exercise such 



3

rights; and (b) should there be a request by any carrier to use the
limited-entry route rights that are included in US Airways’ authority
by virtue of the route integration exemption granted here, but that are
not then 

being used by US Airways, the holding of such authority by route
integration will not be considered as providing any preference for US
Airways in a competitive carrier selection proceeding to determine which
carrier(s) should be entitled to use the authority at issue.

The authority granted to serve intermediate and beyond points is limited
to countries with which the United States has signed open-skies
agreements and/or countries for which the carrier holds authority to
serve under certificates or exemptions issued by the Department, and for
which it holds route integration authority by virtue of either the
present action or other action of the Department.

The statements of authorization granted are subject to the following
conditions:

(a)	The statements of authorization will remain in effect only as long
as (i) US Airways and Lufthansa continue to hold the necessary
underlying authority to operate the code-share services at issue, and
(ii) the code-share agreement providing for the code-share operations
remains in effect.

(b)	US Airways and/or Lufthansa must promptly notify the Department
(Office of International Aviation) if the code-share agreement providing
for the code-share operations is no longer effective or if the carriers
decide to cease operating all or a portion of the approved code-share
services.  Such notices should be filed in Docket OST-2003-15946.

 

(c)	US Airways and/or Lufthansa must notify the Department no later than
30 days before they begin any new code-share service under the
code-share services authorized here.  Such notice shall identify the
market(s) to be served, which carrier will be operating the aircraft in
the code-share market added, and the date on which the service will
begin.  (Such notice should be filed in this Docket.)

 

(d)	The code-sharing conducted under this authority must comply with
Part 257 and with any amendments to the Department’s regulations
concerning code-share arrangements that may be adopted.  
Notwithstanding any provisions in the contract between the carriers, our
approval here is expressly conditioned upon the requirements that the
subject foreign air transportation be sold in the name of the 

carrier holding out such service in the computer reservation systems and
elsewhere; that the carrier selling 

such transportation (i.e., the carrier shown on the ticket) accept
responsibility for the entirety of the code-share journey for all
obligations established in its contract of carriage with the passenger;
and that the 

passenger liability of the operating carrier be unaffected.  Further,
the operating carrier shall not permit the

code of its U.S. air carrier code-sharing partner to be carried on any
flights that enter, depart, or transit the airspace of any area for
whose airspace the Federal Aviation Administration has issued a flight
prohibition.

(e)	The authority to operate to third countries is subject to the
condition that any service provided under the statement of authorization
shall be consistent with all applicable agreements between the United
States and the foreign countries involved.  Furthermore, (i) nothing in
the award of this blanket statement of authorization should be construed
as conferring upon US Airways rights (including code-share, fifth
freedom intermediate and/or beyond rights) to serve markets where U.S.
carrier entry is limited unless US Airways notifies the Department of
its intent to serve such a market and unless and until the Department
has completed any necessary carrier selection procedures to determine
which carrier(s) should be authorized to exercise such rights; and (ii)
should there be a request by any carrier to use the limited-entry route
rights that are included in US Airways’ authority by virtue of the
blanket statement of authorization 

4

granted here, but that are not then being used by US Airways, the
holding of such authority will not be 

considered as providing any preference for US Airways in a competitive
carrier selection proceeding to determine which carrier(s) should be
entitled to use the authority at issue.

(f)	The authority granted here is specifically conditioned so that
neither US Airways nor Lufthansa shall give any force or effect to any
contractual provisions between themselves that are contrary to these
conditions.

________________________________________________________________________
____________

On the basis of data officially noticeable under Rule 24(g) of the
Department's regulations, we found US Airways qualified to provide the
exemption services authorized.

Under authority assigned by the Department in its regulations, 14 CFR
Part 385, we found that (1) our action was consistent with Department
policy; (2) grant of the authority was consistent with the public
interest; and (3) grant of the authority would not constitute a major
regulatory action under the Energy, Policy and Conservation Act of 1975.
 To the extent not granted or deferred, we denied all requests in the
referenced Docket.  We may amend, modify, or revoke the authority
granted in this Notice at any time without hearing at our discretion.

Persons entitled to petition the Department for review of the action set
forth in this Notice under the Department’s regulations, 14 CFR
§385.30, may file their petitions within seven (7) days after the date
of issuance of this Notice.  This action was effective when taken, and
the filing of a petition for review will not alter such effectiveness.

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

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

				Attachment A

Proposed Initial Routes

“LH” Code on Flights Operated by US Airways

To Frankfurt from

	Charlotte, NC

	Pittsburgh, PA

	Philadelphia, PA

To Munich from

	Philadelphia, PA

To Philadelphia from

	Allentown, PA		Elmira/Corning, NY		Philadelphia, PA

	Nantucket, MA		Newark, NJ			Phoenix, AZ

	Atlantic City, NJ		Ft. Lauderdale, FL		Pittsburgh, PA

	Albany, NY		Freeport, Bahamas*		Presque Isle, MA

	Antigua, West Indies*	Frankfurt, Germany		Punta Canta, Dominican
Republic*

	Atlanta, GA		Grand Cayman, Cayman Islands*	Providence, RI

	Aruba, Aruba*		Grenada, Grenada*		Portland, ME

	Augusta, ME		New London, CT			Reading, PA

	Wilkes-Barre, PA		Greensboro, NC			Raleigh/Durham, NC

	Bermuda		Greenville, SC			Richmond, VA

	Bradley Int’l, CT		Westchester Co., NY		Rockland, ME

	Barbados*		New Haven, CT			Roanoke, VA

	Binghamton, NY		Houston, TX			Rochester, NY

	Bangor, ME		Indianapolis, IN			Southwest Florida Regional, FL

	Bar Harbor, ME		Long Island, NY			Rutland, VT

	Birmingham, AL		Jacksonville, FL			San Diego, CA

	Nashville, TN		Las Vegas, NV			Salisbury, MD

	Boston, ME		Los Angeles, CA			State College, PA

	Burlington, VT		New York, NY			Louisville, KY

	Buffalo, NY		London (Gatwick) U.K.*		Santo Domingo, Dominican Republic*

	Baltimore, MD		Montego Bay, Jamaica*		Seattle/Tacoma, WA

	Columbia, SC		Kansas City, MO			San Francisco, CA

	Charlottesville, VA	Orlando, FL			San Juan, PR

	Charleston, SC		Harrisburg, PA			St. Kitts, Leeward Islands*

	Cleveland, OH		Manchester, NH			Orange County, CA

	Charlotte, NC		Miami, FL			St. Louis, MO

	Columbus, OH		Milwaukee, WI			Newburg, NY

	Charleston, WV		Minneapolis/St. Paul, MN		St. Maarten, Netherlands
Antilles*

	Cancun, Mexico		New Orleans, LA			Syracuse, NY	

	Cincinnati, OH		Martha’s Vineyard, MA		Tampa, FL

	Dayton, OH		Myrtle Beach, SC			Knoxville, TN

	Washington, DC		Nassau, Bahamas*		St. Lucia*

	Denver, CO		Norfolk, VA			Ottawa, Ontario*

	Dallas-Ft. Worth, TX	West Palm Beach, FL

	Wayne County, MI	Newport News, VA

*As discussed in the Remarks section of the Notice, we are deferring
action on points marked with an asterisk.

										Attachment A

										Page 2

To Boston from

	Allentown, PA		Elmira/Corning, NY		Punta Canta, Dominican Republic*

	Nantucket, MA		Newark, NJ			Providence, RI

	Atlantic City, NJ		Ft. Lauderdale, FL		Portland, ME  

	Albany, NY		Frankfurt, Germany		Reading, PA      

	Antigua, West Indies*	Frankfurt, Germany		Raleigh/Durham, NC           
 

	Atlanta, GA		New London, CT			Richmond, VA  

	Aruba, Aruba*		Greensboro, NC			Rockland, ME

	Augusta, ME		Greenville, SC			Roanoke, VA

	Wilkes-Barre, PA		Westchester Co., NY		Rochester, NY

	Bermuda		New Haven, CT			Southwest Florida Regional, FL

	Bradley Int’l, CT		Houston, TX			Rutland, VT

	Barbados		Indianapolis, IN			San Diego, CA

	Binghamton, NY		Long Island, NY			Salisbury, MD

	Bangor, ME		Jacksonville, FL			State College, PA

	Bar Harbor, ME		Las Vegas, NV			Louisville, KY

	Birmingham, AL		Los Angeles, CA			Santo Domingo, Dominican Republic*

	Nashville, TN		New York, NY			Salisbury, MD

	Boston, ME		Montego Bay, Jamaica*		Seattle/Tacoma, WA

	Burlington, VT		Kansas City, MO			San Francisco, CA

	Buffalo, NY		Orlando, FL			San Juan, PR

	Baltimore, MD		Harrisburg, PA			St. Kitts, Leeward Islands*

	Columbia, SC		Manchester, NH			Orange County, CA

	Charlottesville, VA	Miami, FL			St. Louis, MO

	Charleston, SC		Milwaukee, WI			Newburg, NY

	Cleveland, OH		Minneapolis/St. Paul, MN		St. Maarten, Netherlands
Antilles*

	Charlotte, NC		New Orleans, LA			Syracuse, NY

	Columbus, OH		Martha’s Vineyard, MA		Tampa, FL  

	Charleston, WV		Myrtle Beach, SC			Knoxville, TN

	Cancun, Mexico		Norfolk, VA			St. Lucia*	

	Cincinnati, OH		West Palm Beach, FL		Ottawa, Ontario*

	Dayton, OH		Newport News, VA		

	Washington, DC		Philadelphia, PA			

	Denver, CO		Phoenix, AZ			

	Dallas-Ft. Worth, TX	Pittsburgh, PA

	Wayne County, MI	Presque Isle, MA

										Attachment A

										Page 3

										

“US” Code on Flights Operated by Lufthansa

To Boston from

	Frankfurt, Germany

	Munich, Germany

To Philadelphia from

	Frankfurt, Germany

To Frankfurt from

	Amman, Jordan*		Muenster, Germany*		Milan, Italy*

	Stockholm, Sweden	Gothenburg, Sweden*		Nice, France

	Bologna, Italy*		Geneva, Switzerland*		Nurenberg, Germany*

	Bremen, Germany*	Hanover, Germany*		Oslo, Norway

	Brussels, Belgium	Hamburg, Germany*		Prague, Czech Republic

	Basel, Switzerland	Helsinki, Finland			Stuttgart, Germany

	Copenhagen, Denmark	Istanbul, Turkey*			Turin, Italy*

	Dresden, Germany	Leipzig, Germany		Tegel, Germany

	Dusseldorf, Germany	Lagos, Nigeria			Venice, Italy

	Dubai, UAE*		Lyon, France

	Florence, Italy*		Malta*

				Marseilles, France*

To Munich from

	Stockholm, Sweden	Hamburg, Germany*		Bucharest, Romania*

	Bremen, Germany*	Helsinki, Finland			Prague, Czech Republic

	Cologne/Bonn, Germany	Istanbul, Turkey*			Stuttgart, Germany

	Copenhagen, Denmark	Lyon, France			Tegel, Germany

	Dusseldorf, Germany	Marseilles, France*		Vienna, Austria

	Muenster, Germany*	Naples, Italy*			Warsaw, Poland

	Gothenburg, Sweden*	Nice, France			Zurich, Switzerland*

 	Hanover, Germany*	Oslo, Norway*

	

				Attachment B

U.S. Carrier Exemption Conditions

In the conduct of the operations authorized, the U.S. carrier
applicant(s) shall:

(1)  Hold at all times effective operating authority from the government
of each country served;

(2)  Comply with applicable requirements concerning oversales contained
in 14 CFR 250 (for scheduled operations, if authorized);

(3)  Comply with the requirements for reporting data contained in 14 CFR
241;

(4)  Comply with requirements for minimum insurance coverage, and for
certifying that coverage to the Department, contained in 14 CFR 205;

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

(6)  Comply with all applicable requirements of the Federal Aviation
Administration and with all applicable U.S. Government requirements
concerning security.  To assure compliance with all applicable U.S.
Government requirements concerning security, the holder shall, before
commencing any new service (including charter flights) to or from a
foreign airport, contact its Principal Security Inspector (PSI) to
advise the PSI of its plans and to find out whether the Transportation
Security Administration has determined that security is adequate to
allow such airport(s) to be served; and

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

The authority granted shall be effective only during the period when the
holder is in compliance with the conditions imposed above.

										08/2003

 US Airways also applied on behalf of its affiliated carriers, Allegheny
Airlines, Inc.; Piedmont Airlines, Inc.; and PSA Airlines.

 Lufthansa also applied on behalf of its affiliate, Lufthansa CityLine
GmbH (Lufthansa CityLine).

 By letter dated September 5, 2003, US Airways clarified that it seeks
authority for the following points:  Amman, Jordan; Stockholm and
Gothenburg, Sweden; Bologna, Florence, Venice, Turin, and Naples, Italy;
Basel, Geneva, and Zurich, Switzerland; Copenhagen, Denmark; Dubai,
U.A.E.; Helsinki, Finland; Istanbul, Turkey; Lagos Nigeria; Malta; Oslo,
Norway; Prague, Czech Republic; Bucharest, Romania; Vienna, Austria; and
Warsaw, Poland.

 See Attachment A for the Routes US Airways and Lufthansa initially
propose to serve.

 Id.

 We expect this notification to be received within 10 days of such
non-effectiveness or of such decision.

 The notice in paragraph (c) above can be used for this notification.

 We note that the code-share arrangement as submitted did not include
provisions regarding exclusive dealings between the code-share parties. 
Should the parties subsequently amend their code-share agreement or any
other agreement affecting the code-share services to include a provision
relating to an exclusive arrangement between the parties, that amended
language must first be submitted for consideration by the Department.

