Order No. 2006-A-677

December 28, 2006

December 28, 2006

IN THE MATTER OF an application for an exemption from section 59 of the Canada Transportation Act, S.C., 1996, c. 10, to permit Air Canada to sell, cause to be sold or publicly offer for sale in Canada a scheduled international service, large aircraft, and a scheduled international service all-cargo aircraft between Canada and Israel, in the absence of a licence.

File No. M4210/A74-4-25


Air Canada has applied to the Canadian Transportation Agency (hereinafter the Agency) for the exemption set out in the title. The application was received on December 12, 2006.

Section 59 of the Canada Transportation Act (hereinafter the CTA) states that no person shall sell, cause to be sold or publicly offer for sale in Canada an air service unless, where required under Part II of the CTA, the person holds a licence under that part in respect of that service.

Under Licence No. 060022, Air Canada is authorized to operate a scheduled international service, large aircraft, and a scheduled international service all-cargo aircraft between Canada and Israel in a manner consistent with the Agreed Minute between Canada and Israel signed on March 16, 2006.

Condition No. 3 of the said licence states:

This licence, unless cancelled at an earlier date, shall be in effect until March 24, 2007.

Air Canada states that it is applying for this exemption to permit it to sell, cause to be sold or publicly offer for sale in Canada a scheduled international service between Toronto and Tel Aviv, Israel beyond March 24, 2007. Air Canada also submits that compliance with section 59 of the CTA is undesirable if the travelling public is to be able to take advantage of its service between Canada and Israel.

The Agency has carefully reviewed and considered the application and notes that the said authority has been renewed on several occasions in accordance with the terms of arrangements on which the service is based. The Agency is of the opinion that in order for the service to be viable, Air Canada must be able to continue selling seats without interruption. Therefore, the Agency finds that compliance by Air Canada 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 Air Canada from the application of section 59 of the CTA, effective from the date of this Order, thereby permitting Air Canada to sell, cause to be sold or publicly offer for sale in Canada a scheduled international service, large aircraft, and a scheduled international service all-cargo aircraft between Canada and Israel for travel beyond March 24, 2007, without holding the required licence, subject to the following conditions:

  1. The exemption authorized herein does not relieve Air Canada from the requirement to hold a licence in respect of the service to be provided and, accordingly, no flights shall be operated until the appropriate licence authority has been granted.
  2. Should the scheduled international licence not issue by March 24, 2007, Air Canada shall arrange to provide alternative air transportation by an appropriately licensed air carrier, at no additional cost for all passengers who have made reservations with Air Canada or, if such arrangements are not possible or acceptable to the passenger, to provide a full refund of all monies paid by the passenger.

The exemption authorized herein is valid until March 24, 2007.

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

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