			  UNITED STATES OF AMERICA

		        DEPARTMENT OF TRANSPORTATION

			  OFFICE OF THE SECRETARY

			          WASHINGTON, D.C.

Issued by the Department of Transportation on May 21, 2004

NOTICE OF ACTION TAKEN -- DOCKETS OST-2004-17517

________________________________________________________________________
__________________________________________

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:  Caribbean Star Airlines, Ltd. & Caribbean Sun Airlines, Inc.
  Date Filed:  April 7, 2004

Relief requested:

Caribbean Star Airlines, Ltd.--Exemption from 49 U.S.C. § 41301 to
engage in scheduled foreign air transportation of persons, property and
mail between St. Johns, Antigua, on the one hand, and San Juan, Puerto
Rico, and St. Thomas, U.S. Virgin Islands, on the other hand, pursuant
to a code-share arrangement with Caribbean Sun Airlines, Inc., a U.S.
certificated air carrier.

Caribbean Sun Airlines, Inc.—Statement of authorization under 14 CFR
Part 212 to the extent necessary to permit Caribbean Sun Airlines, Inc.
(Caribbean Sun) to display the designator code of Caribbean Star
Airlines, Ltd. (Caribbean Star) on flights operated by Caribbean Sun
between San Juan, Puerto Rico, and St. Thomas, U.S. Virgin Islands, on
the one hand, and St. Johns, Antigua, on the other hand.

If renewal, date and citation of last action:  New authority

Applicant(s) representative:  Nathaniel P. Breed, Jr. (202) 973-7919

DOT Analyst:  Gordon H. Bingham (202) 366-2404

Responsive pleadings:  None filed

DISPOSITION

Action:  Approved							Action date:  May 21, 2004

Effective dates of exemption authority granted Caribbean Star:  May 21,
2004-May 21, 2005

Effective dates of the statement of authorization granted Caribbean Sun:
 May 21, 2004-Indefinite

Basis for approval (bilateral agreement/reciprocity):  Air Services
Agreement between the United States and the United Kingdom concerning
air services to which Antigua and Barbuda acceded upon independence in

1981 (the Agreement)

Except to the extent exempted/waived, this authority is subject to the
terms, conditions, and limitations indicated:  X  Standard exemption
conditions (Caribbean Star Attachment A & Caribbean Sun Attachment B) &
Caribbean Sun’s Certificate of Public Convenience and Necessity issued
by Order 2002-12-18.

Special conditions/Partial grant/Denial basis/Remarks:  Based on the
record in this case, we found that Caribbean Star is financially and
operationally qualified to perform the services authorized above.  We
also found that Caribbean Star is substantially owned and effectively
controlled by citizens of Antigua.  Specifically, 

2

Caribbean Star, a corporation organized and existing under the laws of
Antigua, is wholly-owned by Caribbean Star Airlines Holdings, Ltd.
(CSAH), an Antiguan corporation.  CSAH in turn is wholly-owned by Mr. R.
Allen 

Stanford.  Mr. Stanford holds dual citizenship (Antiguan and U.S.).  The
carrier is properly licensed by the Organization of Eastern Caribbean
States (OECS) and was designated by the Government of Antigua and
Barbuda on February 20, 2004, under Annex 1 of U.K. Route 9 of the
Agreement to perform the proposed services.  

Caribbean Star may not conduct U.S. operations with its own aircraft and
crews without further order of the Department. 

The statement of authorization granted to Caribbean Sun is subject to
the following conditions:

(a)  The statement of authorization will remain in effect only as long
as (i) Caribbean Sun and Caribbean Star 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)  Caribbean Sun and/or Caribbean Star 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 the carriers decide to cease operating any or all of the approved
code-share services.  Such notices should be filed in Docket
OST-2004-17517.

(c)  The code-sharing operations conducted under this authority must
comply with 14 CFR 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 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 operator shall not permit the code of its
U.S. code-sharing partner to be carried on any flight that enters,
departs, or transits the airspace of any area for whose airspace the
Federal Aviation Administration has issued a flight prohibition.

(d)  The authority granted here is specifically conditioned so that
neither Caribbean Sun nor Caribbean Star shall give any force or effect
to any contractual provisions between themselves that are contrary to
these conditions.

Action taken by:   Paul L. Gretch, Director	

		      Office of International Aviation	

________________________________________________________________________
_________

Under authority assigned by the Department in its regulations, 14 CFR
Part 385, we found that (1) the applicant was qualified to perform the
proposed operations; (2) our action was consistent with Department
policy; (3) grant of the authority was consistent with the public
interest; and (4) 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/deferred/dismissed, 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

Foreign Carrier Exemption Conditions

In the conduct of the operations authorized, the foreign carrier
applicant(s) 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, including, but not limited to, 49 CFR Part 1546 or 1550, as
applicable.  To assure compliance with all applicable U.S. Government
requirements concerning security, the holder shall, before commencing
any new service (including charter flights) from a foreign airport that
would be the holder’s last point of departure for the United States,
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;

(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.

										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, 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.

  Caribbean Star’s application was accompanied by a motion under Rule
12 (14 CFR § 302.12) to withhold certain financial information from
public disclosure.  In support of its motion, Caribbean Star states that
it is a privately held Antiguan company and, as such, is not required by
its government to disclose such information.  Moreover, Caribbean Star
states that the Government of Antigua allows U.S. carriers to file
financial statements in connection with applications for Antiguan
authority on a confidential basis.  Caribbean Star states that
disclosure of such information would adversely affect Caribbean Star’s
competitive interest vis a vis its commercial competitors and is not
required by the public interest.  Because of the commercially sensitive
nature of the information, we have determined that the documents fall
within the Freedom of Information Act exemption for proprietary
information and would adversely affect the competitive position of
Caribbean Star under 49 U.S.C. § 40115, we therefore grant its motion.

 Mr. Stanford is also the sole owner of Caribbean Sun through his
ownership of Caribbean Sun Airlines Holdings, Inc., a Delaware
corporation.

  Antigua is currently a Category 2 country under the FAA’s
International Aviation Safety Assessment Program (IASA).

  We expect this notification to be received within 10 days of such
noneffectiveness or of such decision.

05/2004

