 

			  UNITED STATES OF AMERICA

		        DEPARTMENT OF TRANSPORTATION

			  OFFICE OF THE SECRETARY

			          WASHINGTON, D.C.

Issued by the Department of Transportation on June 9, 2004

NOTICE OF ACTION TAKEN -- DOCKETS OST-2004-17983

________________________________________________________________________
________________________________________________________

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:  Eurofly S.p.A.							Date Filed:  May 27, 2004

Relief requested:  Exemption from 49 U.S.C. § 41301 to engage in
charter foreign air transportation of persons, property and mail between
Italy and the United States.

Date and citation of last action:  Eurofly previously held the authority
described above; that authority expired by its terms on October 8, 2003
(see Notice of Action Taken, dated October 8, 2001, in Docket
OST-2001-10310)

Applicant representative:  Richard D. Mathias (202) 298-8660

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

Responsive pleadings:  None filed

	DISPOSITION

Action:  Approved								Action date:  June 9, 2004

(We acted on Eurofly’s request in less than the full 15-day period for
filing answers with the consent of all parties served)

Effective dates of authority granted:  June 9, 2004-June 9, 2006

Basis for approval (bilateral agreement/reciprocity):  The U.S.-Italy
Air Services Agreement

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

X  Standard exemption conditions (attached)

Special conditions/Part grant/Denial basis/Remarks.  Based on the record
in this case, we found that Eurofly is financially and operationally
qualified to perform the services authorized above.  However, due to the
involvement of non-homeland entities in the ownership and control
structure of Eurofly, the record in this case does not permit us to make
definitive findings that Eurofly is substantially owned and effectively
controlled by homeland citizens.  The record indicates that Alitalia,
the flag carrier of Italy, holds a 20% interest in Eurofly.  The
remaining 80% is owned by an investment fund in Luxembourg which in turn
is owned by other Luxembourg funds.  At the same time, we note that
Eurofly’s board of directors and all of its key management personnel
are citizens of Italy.  Further, based on the record, we found that
Eurofly is properly licensed by the Government of Italy to perform the
proposed services.  Finally, there is no evidence on the record that
would suggest that the ownership and control of Eurofly would make grant
of this authority inimical to U.S. aviation policy and interests.  Under
the circumstances present, we find that it is consistent with the public
interest to use our discretion and to waive our ownership and control
standard in this instance.  We have verified with the FAA that Eurofly
holds effective FAR Part 129 Operations Specifications.

2

Action taken by:   Paul L. Gretch, Director	

		      Office of International Aviation	

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________________________________________________________

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:

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

													05/2004

 While Eurofly states, in its application, its belief that it is
ultimately owned and effectively controlled by Italian interests, it
also states that, to the extent that we deem otherwise, it requests a
waiver of the ownership and control requirements set forth in the
U.S.-Italy Air Services Agreement.

  Prior to September 2003, Eurofly was a wholly-owned subsidiary of
Alitalia.

  The funds are managed by a Luxembourg company (Profilo Management
Company) established for the exclusive purpose of managing the funds. 
Profilo Management Company is 100% owned by two Italian banks.

