 

	

	        UNITED STATES OF AMERICA

	 DEPARTMENT OF TRANSPORTATION

	         OFFICE OF THE SECRETARY

	               WASHINGTON, D.C.

In the Matter of

Streamlining Regulatory Procedures

For Licensing U.S. and Foreign Air Carriers

Docket OST-2005-22228

Served: August 26, 2005

NOTICE

Summary

By this Notice we announce several steps designed to streamline our
regulatory procedures for licensing U.S. and foreign air carriers.

Discussion

The Department, through its own exploration of how to better serve the
public interest, as well as through its desire to be responsive to
comments voiced in various fora by affected parties, has been seeking
ways to improve the means by which we carry out procedures related to
our international aviation licensing responsibilities.  We recognize
that the need for such streamlining is especially important in the
present highly competitive and largely liberalized international
aviation environment, where carriers face pressing demands to maximize
efficiency and to minimize costs and the impact of administrative delay.

With this in mind, we have undertaken an effort to arrive at ways of
better implementing existing policies and regulations so as to produce
greater administrative efficiencies and greater responsiveness to our
stakeholders.  At the same time we look to reduce the paperwork, cost,
and other burdens on those who come before us.

We have identified several measures suitable for such regulatory
streamlining, one of which will involve some additional but very limited
process and others that we can introduce immediately – indeed, are
introducing concurrently with the issuance of this Notice. 
Specifically, we are launching an expedited and simplified proceeding to
award broad route integration authority on a long-term basis to all U.S.
carriers who desire it.  This will eliminate the need for these carriers
to repeatedly file – and for us to repeatedly process – renewal
requests for authority that rarely, if ever, has proven controversial. 
We will discuss this proceeding in greater detail below.

We are also making significant changes to the way that we process U.S.
and foreign carrier requests for international route authority. 
Typically, when carriers have filed for both long-term (certificate or
permit) authority, as well as short-term (exemption) authority, we have
concentrated our attention on processing the exemption requests because
that has been the fastest way to enable carriers to introduce new
service into the marketplace.  Indeed, in light of the already
highly-streamlined procedures in place for dealing with exemption
applications, we could, in most non-controversial cases, award authority
within days or even hours.  However, the consequence of this approach
has been that while applicants quickly received authority, they did so
in the form of limited-duration awards that had to be periodically and
sometimes frequently renewed while their certificate/permit application
remained pending.

U.S. air carrier certificates and foreign air carrier permits represent
a much longer-term type of authority than exemptions.  Certificate and
permit holders are thus spared the need to make unnecessarily frequent
renewal filings.  The new procedures we are announcing here should
greatly enhance the speed and ease with which we award long-term
certificate and permit authority.  The result will be a greatly reduced
need for carriers, other interested parties, and the Department, to face
the burden and expense of repeated exemption renewal proceedings.

What we contemplate is that U.S. and foreign air carriers seeking new
route authority would file, respectively, concurrent exemption and
certificate applications, or concurrent exemption and permit
applications.  Assuming, based on the record and on the public
interest/public convenience and necessity elements germane to our
licensing decisions, that we were in a position to act favorably, we
would proceed to issue a single order 

(1) granting the exemption request for whatever duration we would
normally have imposed, or until certificate/permit authority becomes
effective, whichever is shorter, and (2) tentatively deciding (i.e.,
show-cause) to award a corresponding certificate (or permit), again for
the standard duration we would normally have imposed (such as, in the
case of certificates, five years for limited-entry markets, indefinite
for open-entry markets, and in the case of permits, five years for
comity and reciprocity regimes, indefinite for agreement regimes).

In the interest of streamlining and expediting the process, these orders
will be issued under authority assigned to the Director, Office of
International Aviation.  This will eliminate several layers of
Departmental review traditionally involved in processing certificate and
permit applications and will unquestionably speed the decisional
process.  We will also include with the exemption/show-cause order a
self-executing final order so that, in the event no objections to the
show-cause portion of the order are filed, a confirming Departmental
final order will be adopted immediately, and the statutorily required
Presidential review process under 49 USC §41307 will commence.

This expedited approach on certificates and permits will of course not
be available in all cases, just as we are not now always able to follow
our existing streamlined procedures on exemptions.  Cases that are
heavily controverted, pose complex or novel legal or policy issues, or
arise in restrictive or contentious bilateral environments, will clearly
require a level of scrutiny not conducive to the expedited approach we
describe above.  However, we think that with so many open-skies
relationships and so many requests that have generated no controversy in
the past and would be unlikely to do so in the future, a substantial
number of applications should be amenable to our new procedures.  Thus,
the benefits in terms of increased efficiency to our stakeholders should
be considerable.

Route Integration

Route integration authority permits U.S. carriers to combine
newly-awarded route authority with all of their existing route authority
(subject to applicable bilateral agreement provisions and certain
standard conditions).  It thus enables those carriers to enjoy greatly
enhanced routing flexibility without the need to seek numerous
individual permissions from the Department.  Many carriers routinely ask
for route integration authority as part of any request for new route
authority and, generally, we routinely grant such requests.  We also
routinely grant route integration requests when submitted in
free-standing applications for such authority.  Whichever the case, all
of the grants have typically taken the form of exemption authority,
meaning an award of limited duration and the need for repeated and
relatively frequent renewals.

In our desire to improve administrative efficiency and ease carrier
burdens in the public interest, we want to vastly reduce the need for
such requests.  We intend to issue a single, broad, five-year route
integration certificate to all U.S. carriers interested in holding such
authority.  The certificate would be subject to our standard certificate
conditions, as well as the standard conditions we impose on awards of
route integration authority.

Before issuing a show-cause order to formally launch this process, we
want to know the full range of carriers that would wish to be included
and the full scope of the authorities that they would want to be covered
by a route integration award.  We thus call upon all U.S. carriers
holding international route authority and desiring to be awarded
authority under our contemplated blanket route integration certificate
to so advise us in a submission to this Docket, no later than fifteen
days from issuance of this notice.

We will thereupon draft an appropriate show-cause order, coupled with a
self-executing final order designed to issue the blanket route
integration certificate, assuming no objections are received, and upon
completion of the 49 USC §41307 Presidential review process.

We will serve this Notice on all U.S. and foreign air carriers.

By:

				KARAN K. BHATIA

				Assistant Secretary for Aviation   

				  and International Affairs

 (SEAL)

Dated: August 23, 2005

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 

 This includes comments received as part of our Regulatory Review
proceeding in Docket OST-2005 20112.

 Where carriers have already filed for both exemption and certificate or
exemption and permit authority, and where the record regarding those
applications remains current, we will immediately begin processing those
applications pursuant to the approach announced here.  See Order
2005-8-17, issued concurrently with this Notice.  Carriers that have
filed still-pending exemption applications but no corresponding
certificate or permit applications and that would want to take advantage
of our new approach should proceed to file the necessary certificate or
permit application, as the case may be.  Carriers that already hold all
the exemption authority they currently require but that do not have
pending certificate or permit applications, should, if they want to take
advantage of our new approach, file an appropriate certificate or permit
application.  We may determine, in a given case, that pursuant to our
regulations, such as 14 CFR §302.210(a)(2), we can proceed directly to
a final decision without the need for an intermediate show-cause order. 
All final decisions to award a certificate or permit would, of course,
still need to undergo Presidential review under 49 USC §41307.

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		Posted:   August 23, 2005, 3:30 p.m.

