 

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, DC

Issued by the Department of Transportation on June 28, 2004

   NOTICE OF ACTION TAKEN -- DOCKET OST-2004-17934           

________________________________________________________________________
_________________________________

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   Alaska Airlines, Inc. and Lan Chile S.A.  filed
5/19/04  for:

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

Scheduled foreign air transportation of property and mail between (1)
New York, New York (JFK), on the one hand, and Lima, Peru; and Santiago,
Chile, on the other hand, and (2) Miami, Florida, on the one hand and
Bogota, Colombia; and Caracas, Venezuela, on the other hand, and to
integrate this authority with its existing certificate and exemption
authority.  Alaska intends to operate this service pursuant to a
code-share arrangement with Lan Chile S.A.

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

Permit Lan Chile to transport property and mail under Alaska’s
designator code on Lan Chile’s scheduled flights between (1) New York,
New York (JFK), on the one hand, and Lima, Peru; and Santiago, Chile, on
the on the other, and (2) Miami, Florida, on the one hand; and Bogota,
Colombia; and Caracas, Venezuela, on the other.

Applicant rep: James M. Waldon, (206) 392-5269 (Alaska) DOT Analyst:
Sylvia Moore, (202) 366-6519

                        Juan Carlos Menció, (305) 869-2993

D I S P O S I T I O N

XX  Granted  (subject to conditions, see below)

The above action with respect to Alaska’s exemption authority was
effective when taken:  June 28, 2004, through   June 28, 2006

The statement of authorization granted to Lan Chile was effective when
taken:   June 28, 2004, 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 Multilateral Agreement
on the Liberalization of International Air Transportation (to which the
United States and Chile are parties), the aviation agreement between the
United States and Peru, and the overall state of aviation relations
between the United States and Colombia and the United States and
Venezuela.

2

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

	   XX  Lan Chile’s foreign air carrier permit      

	   XX  Standard exemption conditions (attached)

The exemption authority granted is subject to the following conditions:

The route integration authority granted is subject to the condition that
any service provided under this authority shall be consistent with the
applicable bilateral aviation agreements between the United States and
the foreign countries involved.  Furthermore, (a) nothing in the award
of this authority requested should be construed as conferring upon
Alaska additional rights (including code-share, fifth-freedom
intermediate and/or beyond rights) to serve markets where U.S. carrier
entry is limited unless Alaska first 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 (b) should
there be a request by any carrier to use the limited-entry route rights
that are included in Alaska’s authority by virtue of the route
integration and blanket code-share authority granted here, but that are
not then being used by Alaska, the holding of such authority will not be
considered as providing any preference for Alaska in a competitive
carrier selection proceeding to determine which carrier(s) should be
entitled to use the authority at issue.

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

(a)	The statement of authorization will remain in effect only as long as
(i) Alaska and Lan Chile 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)	Alaska and/or Lan Chile 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-2002-13609.2

(c)	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; and that the carrier selling such transportation (i.e., the
carrier shown on the waybill) accept responsibility for the entirety of
the code-share journey for all obligations established in its contract
of carriage with the shipper.  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 Administration has issued a
flight prohibition.  

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

(e)	We may amend, modify, or revoke the authority granted at any time
without hearing at our discretion.

3

On the basis of data officially noticeable under Rule 24(g) of the
Department's regulations, we found Continental 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, we denied all requests in the referenced
Docket. 

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



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.

									  05/2004

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

