Order No. 2002-A-553

December 31, 2002

December 31, 2002

IN THE MATTER OF an application by MK Airlines Limited for exemptions from the application of certain provisions of the Air Transportation Regulations, SOR/88-58, as amended, where those provisions conflict with the Government of Canada's Policy for International All-Cargo Charter Air Services announced by the Minister of Transport on May 29, 1998.

File No. M4212/M269-2

On June 7, 2002, MK Airlines Limited has applied to the Canadian Transportation Agency (hereinafter the Agency) for the exemptions set out in the title.

On May 29, 1998, the Minister of Transport (hereinafter the Minister) announced Canada's new Policy for International All-Cargo Charter Air Services (hereinafter the new International All-Cargo Charter Policy).

The Agency is in the process of amending the Air Transportation Regulations (hereinafter the ATR) to ensure that they conform with the new International All-Cargo Charter Policy. However, the Minister has asked the Agency to take measures to implement the new policy while the amendments to the ATR are being developed.

Pursuant to paragraph 80(1)(c) of the Canada Transportation Act, S.C., 1996, c. 10 (hereinafter the CTA), the Agency may exempt a person from the application of any of the provisions of the ATR on such terms and conditions as it deems appropriate where the Agency is of the opinion that compliance with the provision by the person is unnecessary, undesirable or impractical.

The Agency has carefully reviewed and considered the application, and all of the material filed in support thereof, and is of the opinion that, in light of the new International All-Cargo Charter Policy, compliance by MK Airlines Limited with certain provisions of the ATR is unnecessary in this case.

Accordingly, the Agency, pursuant to paragraph 80(1)(c) of the CTA, hereby exempts MK Airlines Limited from the application of the following provisions of the ATR with respect to entity cargo charters operated pursuant to its non-scheduled international Licence No. 020154, from the date of this Order until such time as the amendments to the ATR are promulgated, subject to the terms and conditions set out below as well as to any terms and conditions contained in any charter program permit issued to MK Airlines Limited by the Agency in relation to this Order:

In respect of international entity charters, the provisions of Part III of the ATR that:

  1. restrict the number of charterers to one;
  2. grant Canadian air carriers the right of first refusal in respect of fifth freedom entity charters proposed to be operated by non-Canadian air carriers; and
  3. require that an affidavit of the charterer be filed with the Agency verifying the information set out in paragraph 34(1)(c) of the ATR.

The Agency also exempts MK Airlines Limited from the application of paragraph 20(a) of Part II of the ATR, as it relates to the transportation of cargo, which prohibits a licensee from chartering an aircraft to a person who obtains payment for traffic carried.

Terms and Conditions of Exemption Order

  1. There will be no limit to the number of charterers for cargo charters.
  2. The entire capacity of an aircraft must be chartered.
  3. Direct sale by a licensee at a toll per unit is prohibited.
  4. The new International All-Cargo Charter Policy envisages that foreign charter carriers should have the ability to operate under the same conditions as Canadian charter carriers, provided acceptable reciprocity exists for Canadian carriers.

This Order does not exempt MK Airlines Limited from the requirements of other acts or regulations, including those of Transport Canada.

In the event of any conflict between this Order and any terms and conditions of a charter program permit, the charter program permit shall prevail.

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