Order No. 2004-A-80

February 27, 2004

February 27, 2004

IN THE MATTER OF an application for an exemption from section 59 of the Canada Transportation Act, S.C., 1996, c. 10, to permit Cargojet Airways Ltd. also carrying on business as Starjet and/or Starjet Airways to sell, cause to be sold or publicly offer for sale in Canada a domestic service, large aircraft, a non-scheduled international service, large aircraft, and a scheduled international service, large aircraft between Canada and the United States of America, in the absence of licences.

File Nos. M4210/S515-1
M4210/S515-2
M4210/S515-3


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 the exemption set out in the title. The application was received on February 16, 2004.

Section 59 of the Canada Transportation Act (hereinafter the CTA) prohibits an applicant from selling, causing to be sold or publicly offering for sale in Canada an air service without holding a licence in respect of that service.

Cargojet has applied for licences to operate a domestic service, large aircraft, a non-scheduled international service, large aircraft, and a scheduled international service, large aircraft, between points in Canada and points in the United States of America. However, as the applications are not yet complete, an exemption from the application of section 59 of the CTA is necessary in order to allow Cargojet to sell, cause to be sold or publicly offer for sale in Canada the proposed air services prior to obtaining the applied for licences.

Cargojet states that the objective of section 59 of the CTA will be met notwithstanding the granting of the Exemption Order and that the Exemption Order requested is clearly of the type contemplated by section 80 of the CTA and is in accordance with precedents.

In its application, Cargojet submitted an undertaking that it will arrange to provide alternative air transportation by an appropriately licensed air carrier or air carriers, at no additional cost to its contracted parties and/or passengers, for all contracted parties who have entered into Charter Transportation Agreements with Cargojet and for all passengers who have made reservations with Cargojet to travel between points in Canada and/or between points in Canada and points outside of Canada. In addition, Cargojet has established a trust account where all revenues from sales received prior to the issuance of licences will be deposited in the trust account.

The Agency has carefully reviewed and considered the application and is of the opinion that in order for the proposed services to be viable, Cargojet must be able to offer for sale seats at the earliest possible date. Therefore, the Agency finds that compliance by Cargojet with section 59 of the CTA is impractical in the present circumstances.

Accordingly, the Agency, pursuant to paragraph 80(1)(c) of the CTA, hereby exempts Cargojet from the application of section 59 of the CTA, thereby permitting Cargojet to sell, cause to be sold or publicly offer for sale in Canada a domestic service, large aircraft, a non-scheduled international service, large aircraft, and a scheduled international service, large aircraft, between points in Canada and points in the United States of America, effective from the date of this Order, without holding the required licences, subject to the following conditions:

  1. All passengers and charterers shall be notified, before reservation, that the services are subject to government approval. All future advertising in any media, whether in writing or by telecommunication, shall also include this information.
  2. The exemption authorized herein does not relieve Cargojet from the requirement to hold licences in respect of the services to be provided and, accordingly, no flights shall be operated until the appropriate licence authorities have been granted.
  3. Cargojet shall arrange to provide alternative air transportation by an appropriately licensed air carrier, at no additional cost for all passengers and charterers who have made reservations with Cargojet, or, if such arrangements are not acceptable to the passenger, to provide a full refund of all monies paid by the passenger, should the licences not issue.
  4. All revenues from the sale of tickets shall be deposited and held in a trust account until the issuance of the licences or until alternative air transportation arrangements are finalized.

The exemption granted herein does not exempt Cargojet from the requirements of other legislative acts or regulations, including those of Transport Canada.

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