Decision No. 173-A-2004

March 31, 2004

March 31, 2004

APPLICATION by Cargojet Airways Ltd. also carrying on business as Starjet and/or Starjet Airways pursuant to subsection 73(1) of the Canada Transportation Act, S.C. 1996, c. 10, for authority to also operate a non-scheduled international service, large aircraft, under Licence No. 000015.

File No. M4210/C544-2


Cargojet Airways Ltd. also carrying on business as Starjet and/or Starjet Airways (hereinafter Cargojet) has applied to the Canadian Transportation Agency (hereinafter the Agency) for authority to operate the service set out in the title. The application was received on February 16, 2004, revised on February 18, 2004 and was complete and ready for processing on March 30, 2004.

Under Licence No. 000015, Cargojet is authorized to operate a non-scheduled international service, all-cargo aircraft, to transport traffic on a charter basis between Canada and any other country.

The Agency has reviewed the application and is satisfied that the applicant meets the requirements of paragraph 73(1)(a) of the Canada Transportation Act (hereinafter the CTA).

In order for a licence to be issued, the Agency must also be satisfied, as provided for in paragraph 73(1)(b) of the CTA, that Cargojet has not contravened section 59 of the CTA to the effect that no person has sold, caused to be sold or publicly offered for sale in Canada an air service within the preceding twelve months unless the person held a licence in respect of that service.

Cargojet filed an affidavit wherein it disclosed the execution of a term sheet with a future client. In its affidavit, Cargojet confirms that at the time of the execution of the document its understanding of the terms sell and cause to be sold as stated in section 59 of the CTA pertained to the selling or publicly offering for sale an air service.

The Agency has carefully considered the matter and finds that Cargojet, by executing a term sheet, offered for sale an air service, therefore contravened section 59 of the CTA. The Agency notes, however, that Cargojet, based on its understanding of the provisions of section 59 of the CTA, mistakenly offered for sale an air service. The Agency also notes Cargojet's statement that no other agreements or similar documents have been entered into since the execution of the term sheet.

In light of the foregoing, the Agency is of the opinion that Cargojet's failure to obtain a licence before offering the service was not a wilful attempt to avoid compliance with legislative and regulatory requirements. Therefore, pursuant to subsection 79(2) of the CTA, the Agency will not refuse to issue a licence to Cargojet even though Cargojet has contravened section 59 of the CTA. However, Cargojet should be aware that the Agency considers contraventions of provisions of the CTA or the Air Transportation Regulations, SOR/88-58, as amended, to be serious and will take appropriate punitive action should any such contraventions occur in the future.

Accordingly, a new document of licence bearing Licence No. 000015 will be issued to Cargojet Airways Ltd. also carrying on business as Starjet and/or Starjet Airways authorizing it to also operate a non-scheduled international service, large aircraft.

With respect to the contravention set out above, the issuance of this licence does not in any way preclude any actions that may be taken against Cargojet pursuant to the Canadian Transportation Agency Designated Provisions Regulations.

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