 

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, DC

Issued by the Department of Transportation on October 5, 2005

NOTICE OF ACTION TAKEN -- DOCKET OST-2005-22243 

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 Delta Air Lines (Delta) filed 8/24/05 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 Cincinnati, Ohio, and the terminal point
San Jose del Cabo, Mexico; (2) the terminal point Atlanta Georgia, and
the terminal point Merida, Mexico; (3) the terminal point New York, New
York/ Newark, New Jersey, on the one hand, and each of the following
terminal points in Mexico on the other hand: (a) Cozumel, (b) Puerto
Vallarta, (c) San Jose del Cabo, and (d) Acapulco; and to integrate this
authority with Delta’s existing exemption and certificate authority,
to the extent permitted by applicable international agreements.  Delta
proposes to operate these services on a year-round basis. 

Applicant rep: Alexander Van der Bellen, (202) 637-8382 	DOT Analyst:
Tretha Chromey (202) 366-2367

D I S P O S I T I O N

XX	Granted, in part, exemption authority (subject to conditions, see
below)

XX	Deferred the New York-San Jose del Cabo request (see remarks below)

The above action was effective when taken: October 5, 2005 through
October 5, 2007. 

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)

Responsive Pleadings:  Continental Airlines (Continental) filed an
answer stating it does not object to Delta’s application so long as
its New York/Newark-Cozumel, San Jose del Cabo, Puerto Vallarta, and
Acapulco service remains effective.  American Airlines (American)
opposes Delta’s request for route authority for the New York-San Jose
del Cabo market.  American filed a competing application to serve the
New York-San Jose del Cabo market in Docket OST-2005-22331.  Because
only one designation opportunity is available, American states that a
carrier selection proceeding is required for this service.  By letter
dated September 1, 2005, counsel for Delta requested that we proceed
with Delta’s application, but defer decision on the New York-San Jose
del Cabo portion pending a carrier selection proceeding.

Conditions:  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 Delta’s proposed start-up dates for each city
pair market. 

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

Remarks:  Currently, under the Air Transport Agreement between the
Government of the United States of America and the Government of the
United Mexican States (Agreement), up to a total of two U.S. carriers
may be designated to provide direct-carrier (own-aircraft) services in a
given city-pair market.  Only one designation opportunity is available
for the New York-San Jose del Cabo market at this time.  However, recent
US-Mexico consultations have resulted in an ad referendum amendment to
the Agreement, which would expand the number of designations available
for US carriers to provide scheduled services in certain city pair
markets, including New York-San Jose del Cabo.  In the circumstances
presented, we defer action on the applicant’s request for authority
with respect to the New York-San Jose del Cabo city pair until such time
as the amendments are effective.

On the basis of data officially noticeable under Rule 24(g) of the
Department's regulations, we found the applicant 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 or 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 

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

 Delta proposed the following start-up dates: Cincinnati-San Jose del
Cabo - December 3, 2005; Atlanta-Merida - February 25, 2006; New
York-Cozumel/Puerto Vallarta - March 4, 2006; and New York-Acapulco -
March 11, 2006.

 A recently negotiated amendment to the Agreement that would expand the
number of U.S. carrier scheduled service designations in certain
city-pair markets, including the New York-San Jose del Cabo market, is
not yet effective between the Governments of the United States and
Mexico.    We note that American submitted a motion in this docket and
Docket OST-2005-22331, requesting that we grant the applications of
Delta and American with respect to New York-San Jose del Cabo route
authority in light of the increase in designation opportunities for this
market under the amended Agreement.  Delta answered in support of
American’s motion and urges us to grant the two applications.  We are
taking no action on American’s motion or Delta’s response at this
time.

