			  UNITED STATES OF AMERICA

		        DEPARTMENT OF TRANSPORTATION

			  OFFICE OF THE SECRETARY

			          WASHINGTON, D.C.

Issued by the Department of Transportation on June 1, 2004  

NOTICE OF ACTION TAKEN -- DOCKET OST-2004-17408

________________________________________________________________________
_____________________________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).

Application of GRAND HOLDINGS, INC., d/b/a CHAMPION AIR  filed 3/24/04
for:

XX  Exemption for two years under 49 U.S.C. §40109 to provide the
following service:

Scheduled foreign air transportation of persons, property, and mail
between: (1) the terminal point Denver, Colorado, and the terminal point
Puerto Vallarta, Mexico; (2) the terminal point Dallas/Ft. Worth, Texas,
and the terminal point Cozumel, Mexico; (3) the terminal point
Dallas/Ft. Worth, Texas, and the terminal point Puerto Vallarta, Mexico;
(4) the terminal point Minneapolis/St. Paul, Minnesota, and the terminal
point Mazatlan, Mexico; (5) the terminal point St. Louis, Missouri, and
the terminal point Cancun, Mexico; (6) the terminal point St. Louis,
Missouri, and the terminal point Puerto Vallarta, Mexico.  With the
exception of the St. Louis-Cancun market (where Champion Air proposes
year-round service), Champion Air proposes to provide seasonal service
in all of the subject markets.  No party opposed the applicant’s
request for authority to serve the Dallas/Ft. Worth-Cozumel/Puerto
Vallarta, Minneapolis/St. Paul-Mazatlan, and St. Louis-Puerto Vallarta
markets. 

Applicant rep:   Curt Berchtold (952) 814-8785     DOT Analyst:  Linda
L. Lundell (202) 366-2336

D I S P O S I T I O N

XX  Granted Dallas/Ft. Worth-Cozumel/Puerto Vallarta, Minneapolis/St.
Paul-Mazatlan, and St. Louis-Puerto Vallarta exemption authority,
subject to conditions (see below).

XX  Deferred on the St. Louis-Cancun and Denver-Puerto Vallarta requests
(see below).

The action, above, granting exemption authority was effective when
taken: June 1, 2004, through June 1, 2006.

The action to defer was effective June 1, 2004.

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 Mexico.

Except to the extent exempted or waived, this authority is subject to
the terms, conditions, and limitations indicated:

XX  Holder’s certificates of public convenience and necessity

XX  Standard Exemption Conditions (attached)

________________________________________________________________________
____________________Special Conditions/Remarks:  The U.S.-Mexico
exemption authority granted is subject to the dormancy notice
requirements set forth in condition 7 of Appendix A of Order 88-10-2. 
Consistent with our policy, the dormancy notice period will begin on the
carrier’s proposed start-up dates in the subject markets, as follows: 
immediately for the Dallas/Ft. Worth-Cozumel/Puerto Vallarta, and St.
Louis-Puerto Vallarta markets; and December 1, 2004, for the
Minneapolis/St. Paul-Mazatlan market.  

We will handle the carrier’s requests for authority to serve the St.
Louis-Cancun and Denver-Puerto Vallarta markets separately.  Under the
U.S.-Mexico aviation agreement, two U.S. airlines may be designated to
provide direct carrier service in any given city-pair market. 
Currently, one U.S. carrier is designated to provide such services in
both the St. Louis-Cancun and Denver-Puerto Vallarta markets (TWA
Airlines and Frontier, respectively).  Thus, only one designation is
available for U.S. carrier service on each of these routes.  Three
applications have been filed for the St. Louis-Cancun market
(Champion’s application here, Frontier Airlines’ application in
Docket OST-2004-17470, and USA 3000 Air Lines’ application in Docket
OST-2004-17479), and two applications have been filed for the
Denver-Puerto Vallarta market (Champion’s application here and United
Air Lines’ application in Docket OST-2004-17491).   

________________________________________________________________________
____________________

On the basis of data officially noticeable under Rule 24(g) of the
Department’s regulations, we found the applicant qualified to provide
the 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 application 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:

  HYPERLINK "http://dms.dot.gov/reports_aviation.asp" 
http://dms.dot.gov/reports_aviation.asp 

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, including, but not limited to, 49 CFR Part 1544. 
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
International Principal Security Inspector (IPSI) to advise the IPSI 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.

   Competing applications and responsive pleadings were filed to the St.
Louis-Cancun and Denver-Puerto Vallarta portions of the application (see
remarks, below).

  The carrier proposed a May 1, 2004, startup date for the Dallas/Ft.
Worth-Cozumel/Puerto Vallarta services, and a June 1, 2004, startup date
for the St. Louis-Puerto Vallarta services.  

05/2004

