OST-2000-6756 - Delta Air Lines and South African Airways

South African and Delta now are requesting additional authority to operate services between South Africa and Fort Lauderdale in conjunction with SAA'S new Atlanta service. Specifically, South African plans to add an intermediate stop at Fort Lauderdale on three of its seven weekly scheduled flights between South Africa and Atlanta, and South African and Delta jointly will offer code-share services in conjunction with the Fort Lauderdale stop. South African and Delta plan to begin the Fort Lauderdale services, like the Atlanta services, on January 30, 2000.

Counsel: Zuckert Scoutt, David Heffernan, 202.298.8660 and Shaw Pittman, Robert Cohn, 202.663.8060

Statements of authorization pursuant to 14 CFR 212 of the Department's regulations to permit: (1) Delta to display SAA's designator code on flights operated by Delta between Fort Lauderdale and 25 currently authorized U.S. code-share points; and (2) SAA to display Delta's designator code on flights operated by SAA between Johannesburg/Cape Town, and Fort Lauderdale.

The Department of Transportation has authorized SAA to operate routes between the United States and the RSA. SAA's exemption authority extends to foreign air transportation of persons, property, and mail service, as follows:

SAA also is authorized to: (i) serve New York, Miami, Atlanta, Los Angeles, and Fort Lauderdale on a coterminal basis; (ii) serve twenty-five U.S. points under a code share arrangement with Delta Air Lines, Inc; and (iii) conduct charter foreign air transportation pursuant to 14 C.F.R. Part 212.

Relief requested: (Docket OST-99-6555) Renew exemption from 49 U.S.C. 41301 to: (1) conduct scheduled foreign air transportation of persons, property and mail between (a) Johannesburg, South Africa, and New York, NY, via the intermediate point Ilha do Sal, Cape Verde; (b) Johannesburg/Cape Town, South Africa, and Miami, FL; (c) Johannesburg and Los Angeles, CA (and, on this Los Angeles route, to commingle blind sector traffic not moving in foreign air transportation between Johannesburg and Rio de Janeiro, Brazil); (d) Johannesburg/Cape Town, via the intermediate point Ilha do Sal, and Atlanta, GA; and (e) serve 25 named U.S. points beyond Atlanta on a code-share basis with Delta Air Lines, Inc.; (2)serve Los Angeles/New York /Miami/Atlanta on a coterminal basis; and (3) conduct charter foreign air transportation pursuant to 14 CFR 212 of the Department's regulations. (Docket OST-2000-6756) Renew exemption from 49 U.S.C. 41301 to conduct scheduled foreign air transportation of persons, property and mail between Johannesburg/Cape Town and Fort Lauderdale, FL, on a coterminal basis with New York/Miami/Los Angeles/Atlanta services

Hereby apply for amended exemption authority and statements of authorization. The Joint Applicants seek authority to expand their existing codeshare arrangement to include Delta/Delta Connection operated service to West Palm Beach, Florida, and SAA-operated service to Entebbe/Kampala, Uganda.

The Joint Applicants also plan to introduce SAA codeshare service on Delta operated flights between New York (JFK) and Fort Lauderdale. Fort Lauderdale is an existing SAA gateway point.

In order to add West Palm Beach as a U.S. point authorized for codeshare-only service, SAA has asked its government to designate Washington, D.C., currently a codeshare-only point, as an additional U.S. gateway for direct service from South Africa. Under the bilateral agreement, gateway points may also be served on a codeshare basis. SAA previously selected - - and the Department issued SAA exemption authority to serve - - all 25 U.S. codeshare only points available under the bilateral. Included among the current authorized codeshare-only points is Washington, D.C. Although the Joint Applicants intend to continue to serve Washington on a codeshare basis in the near term, SAA has asked the Government of South Africa to notify the Government of the United States that Washington has been designated as the final available direct service gateway under the bilateral agreement, thereby opening up codeshare only service to an additional U.S. point. SAA has requested that its government also select West Palm Beach as a new codeshare point, and expects the appropriate notification to be issued shortly.

Counsel: Zuckert Scoutt, Frank Costello, 202.298.8660 and Shaw Pittman, Robert Cohn, 202.663.8060

(1) Amend exemptions from 49 U.S.C. 41301 (last granted January 18, 2002, in Dockets OST-99-6555 and OST-2000-6756) to permit SAA to: (a) conduct scheduled foreign air transportation of persons, property and mail between Johannesburg/Cape Town, South Africa, via the intermediate point Ilha do Sal, Cape Verde, and Washington, D.C.; (b) serve Washington, D.C. on a coterminal basis with its existing U.S. gateways at Atlanta, New York, Fort Lauderdale, Miami and Los Angeles; and (c) add West Palm Beach, FL, as one of the 25 U.S. points SAA may serve only on a codeshare basis beyond its U.S. gateways. (SAA requested that this authority remain in effect through January 18, 2004, coextensive with its existing exemption authority in this docket.)

The Department of Transportation has authorized SAA to operate routes between the United States and the Republic of South Africa. SAA's exemption authority extends to foreign air transportation of persons, property, and mail service, as follows:

SAA also has been authorized to: (i) serve Atlanta, Fort Lauderdale, Los Angeles, Miami, New York, and Washington, DC on a co-terminal basis; (ii) serve twenty-five points in the United States pursuant to a code-share arrangement with Delta Air Lines, Inc.; and (iii) conduct foreign charter air transportation pursuant to 14 C.F.R. Part 212.

SAA is not seeking by this application an expansion or change to its exemption authority.

Docket OST-2002-13366: Renew exemption from 49 U.S.C. § 41301 to permit South African Airways (SAA) to conduct scheduled foreign air transportation of persons, property and mail between SAA’s U.S. gateways and Dakar, Senegal, as an intermediate point on SAA’s authorized U.S.-South Africa services.

Dockets OST-99-6555 and OST-2000-6756: Renew exemption from 49 U.S.C. § 41301 to permit South African Airways to (1) engage in scheduled foreign air transportation of persons, property and mail between (a) Johannesburg, South Africa, and New York, New York, via Ilha do Sal, Cape Verde; (b) Johannesburg/Cape Town, South Africa, and Miami, Florida; (c) Johannesburg and Los Angeles, California (and, on this Los Angeles route, to commingle blind sector traffic not moving in foreign air transportation between Johannesburg and Rio de Janiero, Brazil); (d) Johannesburg/Cape Town, South Africa, via Ilha do Sal, Cape Verde, and Atlanta, Georgia; (e) Johannesburg/Cape Town and Ft. Lauderdale, Florida, on a coterminal basis with New York/Miami/Los Angeles/Atlanta services; (f) Johannesburg/Cape Town, and Washington, D.C., via Ilha do Sal, Cape Verde; (g) serve 25 named U.S. points beyond Atlanta, Georgia, on a codeshare basis with Delta Air Lines, Inc. (Delta) [1]; (h) serve Los Angeles/New York/Miami/Atlanta/Washington, D.C. on a coterminal basis; and (3) conduct charters in accordance with Part 212 of the Department’s regulations.

The 25 cities are: Baltimore, Boston, Chicago, Cincinnati, Cleveland, Dallas/Ft. Worth, Denver, Detroit, Houston, Las Vegas, Minneapolis-St. Paul, New Orleans, Orlando, Philadelphia, Phoenix, Pittsburgh, Portland, Raleigh/Durham, St. Louis, Salt Lake City, San Diego, San Francisco, Seattle, Tampa, and West Palm Beach.

1. SAA requests a statement of authorization for code-share authority to display United's "UK' designator code on flights operated by SAA between Washington, D.C. and points in South Africa, via intermediate points, and to points beyond South Africa as listed on Appendix A.

2. United requests a statement of authorization for code-share authority to display SAA's "SA" designator code on flights operated by United between Washington D.C. and points in the United States as listed on Appendix A.

3. United requests that the Department grant it an exemption authorizing United to engage in scheduled foreign air transportation of persons, property and mail, in combination or separately, between any point or points in the United States, on the one hand, via the intermediate points, Frankfurt, London, Paris, and Zurich, without local traffic rights, and Johannesburg, Cape Town, Durban, East London, George and Port Elizabeth, South Africa, on the other hand, and beyond Johannesburg to Lusaka, Zambia; Kinshasa, Democratic Republic of the Congo (formerly Zaire); Nairobi, Kenya; and Windhoek, Namibia, without local traffic rights, pursuant to its code-share arrangement with SAA. In addition, United requests route integration authority to combine this exemption authority with its current certificate and exemption authority as permitted under applicable bilateral agreements. United requests that this exemption authority be granted for a period of at least two years.

Attached please find a copy of an Addendum dated November 30, 2005, to the Code Share and Regulatory Cooperation Agreement between United and South African Airways as referenced in the Joint Application filed in the above‑referenced dockets on September 29, 2005. That Addendum amends certain terms of the Agreement.

Display South African Airways’ (SAA) code on flights operated by United between Washington DC and the following points in the United States: Boston, Chicago, Cleveland, Dallas/Ft. Worth, Denver, Ft. Lauderdale, Las Vegas, Los Angeles, San Diego, San Francisco, and Seattle.

Scheduled foreign air transportation of persons, property and mail, in combination or separately, between any point or points in the United States, on the one hand, via the intermediate points Frankfurt, London, Paris, and Zurich, without local traffic rights, and Johannesburg, Cape Town, Durban, East London, George, and Port Elizabeth, South Africa, on the other hand, and beyond Johannesburg to Lusaka, Zambia; Kinshasa, Democratic Republic of the Congo (formerly Zaire); Nairobi, Kenya; and Windhoek, Namibia, without local traffic rights, pursuant to a code-share arrangement with SAA.’ United also requests route integration authority to combine this exemption authority with its current certificate and exemption authority as permitted under applicable bilateral agreements.

United currently holds a certificate for Route 747 authorizing United to serve between any points in the U.S., via any intermediate points in third countries, and the coteminal points Johannesburg and Cape Town, South Africa, and beyond South Africa to Harare, Zimbabwe. United states that since the code-share services proposed herein exceed the scope of this existing certificate authority, United is requesting exemption authority that is broad enough to encompass all of its code-share services to be operated by SAA.

Display United’s designator code on flights operated by SAA between Washington DC and points in South Africa, via intermediate points, and to points beyond South Africa, on SAA flights operating over the following specific city-pair routes: Johannesburg - Washington DC; Frankfurt, London, Paris, Zurich-Johannesburg; Frankfurt, London - Cape Town; Johannesburg - Cape Town, Durban, East London, George, Port Elizabeth; and Johannesburg - Kinshasa (Democratic Republic of the Congo), Lusaka (Zambia), Nairobi (Kenya), and Windhoek (Namibia).

Serve the 25 named U.S. points in SAA’s existing exemption authority on a code-share basis in conjunction with United from any of SAA’s U.S. gateways. The Joint Applicants request that this authority be issued for a period coextensive (i.e., March 21, 2007) with the existing exemption authority previously granted to SAA in Dockets OST-1999-6555 and OST-2000-6756.

The 25 code-share only points are as follow: Baltimore, Boston, Ft. Lauderdale, Cincinnati, Cleveland, Dallas/Ft. Worth, Denver, Detroit, Houston, Las Vegas, Minneapolis/St. Paul, New Orleans, Orlando, Philadelphia, Phoenix, Pittsburgh, Portland, Raleigh/Durham, St. Louis, Salt Lake City, San Diego, San Francisco, Seattle, Tampa and West Palm Beach.

On September 29, 2005, South African Airways (Pty) Limited applied in Docket OST-2005-22618 for authority to implement its code-sharing relationship with United Airlines, Inc., and in Dockets OST-1999-6555 and OST-2000-6756 to amend its underlying exemption authorities to permit these cooperative services. By Notice of Action Taken dated December 23, 2005, the Department approved these requests, including granting SAA authority to hold out service to 25 points in the United States beyond its US gateways pursuant to its code-share arrangement with United.

In the December 2005 NOAT, the Department granted SAA's request to code-share on United flights to authorized points beyond SAA's US gateways. In a footnote in that NOAT, the Department expressly recognized that certain of the "beyond" points at issue might be serve either by United itself or by a United Express commuter carrier.

SAA believes that the authority it holds contemplates SAA's holding out service to points in the United States by code-sharing on services operated by United or a United Express commuter carrier. However, out of an abundance of caution, and to the extent necessary, SAA hereby requests that the Department amend its exemption authorities to expressly authorize SAA to hold out service to points in the United States pursuant to a codeshare arrangement with United or any current or future United Express carrier.

Approval of this authority would be entirely consistent with the public interest. By granting SAA the flexibility to hold out service to its authorized points in conjunction with either United or any current or future "United Express" commuter carrier, the Department will eliminate the need to grant successive approvals necessitated by changes in the service patterns offered by United and/or its commuter partners. Accordingly, this Application should be granted without delay.

On behalf of South African Airways (Pty) Limited, I have polled the representatives of all carriers on the service list attached to the Application of SAA filed January 4, 2007, in the above-referenced dockets. All carriers' representatives have advised me that they have no objection to the granting of this application.

OST-2007-26817 - Statements of Authorization - Codesharing with South African Airways
OST-2005-22618 - South African - US-South Africa Codesharing
OST-2000-6756 - South African - US- South Africa Codesharing
OST-1999-6555 - South African - US- South Africa
OST-2006-26485 - South African - Exemption - Johannesburg-Chicago

Amendment: Scheduled service to 25 named U.S. points beyond SAA’s U.S. gateways on a code-share basis in conjnnction with any current or future United Express carrier.

Blanket Statements of Authorization: Display SAA’s “SA“” designator code on flights operated by any of the Joint Applicants as a United Express carrier between SAA’s coterminal U.S. gateways, as well as between each of those U.S. gateways, on the one hand, and points in the United States, on the other hand, and beyond to points in third countries without local traffic right.

OST-1999-6555 - Exemption - US-South Africa
OST-2000-6756 - Exemption - US-South Africa Codesharing with Delta
OST-2002-13366 - Exemption - South Africa-US Codesharing with Delta (Adding Dakar, Senegal as an Intermediate Point)

South African Airways (Pty) Limited hereby applies for renewal of several of its existing exemptions from 49 U.S.C. § 41301, which permit SAA to operate scheduled and charter foreign air transportation services between the United States and South Africa. SAA requests that the Department renew these exemptions for at least two years.

SAA's current exemption authority permits it to engage in scheduled foreign air transportation of persons, property, and mail between:

SAA previously held authority to provide scheduled service between South Africa and Ft. Lauderdale. SAA since has obtained authority to hold out service between South Africa and Chicago, Illinois, substituting Chicago for Ft. Lauderdale as one of SAA's U.S. gateway picks. The Department also has authorized SAA to (i) serve Los Angeles, New York, Miami, Atlanta, and Washington, D.C. on a co-terminal basis; (ii) serve 25 named U.S. points beyond its U.S. gateways on a code-share basis in conjunction with a U.S. partner; and (iii) conduct foreign charter air transportation in accordance with Part 212 of the Department's regulations.

The authorities listed above are scheduled to expire on March 21, 2007. By this Renewal Application, SAA requests that the Department renew these exemptions for at least two years.

Delta is constrained to file this Answer objecting to the renewal application unless and until the Government of South Africa grants Delta's six-month old request to use its entire fleet of B-767-300ER aircraft for its bilaterally authorized service between the United States and South Africa.

When Delta originally applied to operate service between Atlanta and Johannesburg, it proposed to utilize a B-777 aircraft. Delta revised its service plan and three months before the start date of its service, in September 2006, Delta filed a request with the Government of South Africa to use any of its 59 B-767 aircraft on the route.

Delta must have the flexibility to use its entire B-767 fleet to serve the South Africa route because Delta does not dedicate particular aircraft to particular international routes. Therefore, Delta requested that its entire B-767 fleet be authorized to serve the South Africa route.

Delta received provisional approval to use only 20 B-767 aircraft for the South Africa route, which enabled Delta to inaugurate its service in December. However, as the busy peak season approaches, Delta's inability to use its entire 59 aircraft B-767 fleet to fund its South Africa service is imposing unnecessary hardship on Delta and causing onerous aircraft scheduling difficulties and complexities.

The failure of the South African Government to take timely action on Delta's request at a minimum constitutes a failure of reciprocity, if not an outright violation of the U.S.-South Africa Air Transport Services Agreement.

The Department should not countenance continued delay and should send a clear message to the South African Government that no approvals shall be granted for South African Airways unless and until Delta's long pending request is approved.

Delta asserts that the CAA has either delayed or withheld approval of Delta's ability to use all aircraft in its B-767 fleet when flying to/from South Africa, and instead has certified only a limited number of aircraft for such operations. See, Answer of Delta dated March 13, 2007, at 2. Delta asserts that its request has been pending since September 2006. Although SAA does not believe that renewal of its bilaterally-authorized rights should be in any way linked with Delta's compliance with CAA rules, SAA in recent weeks has urged its CAA and Department of Transport to work cooperatively with Delta to resolve Delta's concerns.

In response to SAA's inquiry, the South African DOT indicated that Delta's application to add additional aircraft to its fleet was filed in December 2006, and was not complete. The South African DOT has indicated its willingness to approve a completed Delta application on an expedited basis.

Counsel for SAA has conferred with counsel for Delta. There apparently is some controversy about when Delta did (or did not) file the needed paperwork with the CAA, and whether that paperwork was complete as filed. Regardless of whether Delta's application was filed in September 2006 (as it claims), or in December 2006 (as the DOT believes), SAA believes that the key issue is that the Government of South Africa is aware of this issue, and does not in any way object to certifying Delta's full B-767 fleet for service to South Africa provided that all of the underlying requirements are met. SAA understands that the CAA has been in contact with Delta's local counsel, and is attempting to resolve Delta's issues.

Renewal of SAA's right to serve the United States should not be affected by the issue here. The CAA does not object to Delta's efforts to add additional aircraft to its operating certificate as a matter of principle or law. The CAA has stated that it would have no difficulty in granting Delta's request once the appropriate documentation has been filed. In SAA's view, this statement should hopefully resolve this matter.

Delta Air Lines appreciates the desire of South African Airways to obtain expedited action on its renewal application. However, SAA's reply does not correctly characterize the facts relating to Delta's unsuccessful efforts to obtain approval from the South African Government to operate its fleet of B‑767‑300 aircraft as it is authorized to do under the bilateral Air Transport Agreement. Although SAA claims that "the Government of South Africa is aware of this issue, and does not object to certifying Delta's full B‑767‑300 fleet for service to South Africa", the continued delay in doing so‑now extending to 6 months is inexcusable.

Delta continues to assert that the CAA has either delayed or withheld approval of Delta's ability to use all aircraft in its B-767 fleet when flying to/from South Africa, and urges DOT to delay or withhold renewal of SAA's US licenses until its own situation is resolved. SAA respectfully requests leave to file this brief additional comment in order to refute some of the claims that Delta has raised, and again, to remind the Department that Delta's compliance with local South African CAA regulations and SAA's bilaterally authorized route authorities are unrelated to each other, and should in no way be linked.

As SAA previously has stated, the renewal of SAA's licenses to serve the United States should not be affected by the issue here. SAA and the CAA do not object to Delta's efforts to add additional aircraft to its operating certificate as a matter of principle or law. The CAA has stated that it would have no difficulty in granting Delta's request once the appropriate documentation has been filed. Just as the US Federal Aviation Administration would require certain documentation from foreign air carriers before adding aircraft to their operations specifications, the South African CAA has required Delta to do the same.

SAA urges the Department to resist Delta's demand that it take any sort of punitive action against SAA. SAA is merely a bystander here. Moreover, from SAA's perspective, it would be prudent for DOT not to link issues relating to economic rights to those relating to compliance with technical or safety rules. Accordingly, DOT should grant the requested renewal of exemption authority without delay.

OST-2000-6756 - Exemption - US-South Africa Codesharing with Delta	January 7, 2000	Joint Application for Exemption	U.S.- South Africa Codesharing
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OST-99-6555 OST-00-6756	December 17, 2001	Application for Renewal of Exemption	US-South Africa / Codeshare with Delta Air Lines
		Service List