Decision No. 304-A-2005

May 13, 2005

May 13, 2005

APPLICATION by Air Canada, on behalf of itself and World Airways, Inc., for an approval pursuant to section 60 of the Canada Transportation Act, S.C., 1996, c. 10 and section 8.2 of the Air Transportation Regulations, SOR/88-58, as amended, to permit Air Canada to provide its scheduled international all-cargo service between Canada and the People's Republic of China on a Toronto-Shanghai routing, with technical stops at Anchorage, Alaska, United States of America using aircraft and flight crew provided by World Airways, Inc. from May 15, 2005 to May 14, 2007.

File No. M4835-2-50


Air Canada, on behalf of itself and World Airways, Inc. (hereinafter World Airways), has applied to the Canadian Transportation Agency (hereinafter the Agency) for the approval set out in the title. The application was received on April 8, 2005.

Air Canada submits that the wet lease arrangement is necessary because Air Canada does not currently have combination or freighter aircraft in its fleet yet it needs to meet the needs of its customers. According to the applicant, it is pursuing the selection of potential freighter aircraft, however, this complex process will take time for completion.

Air Canada has also requested an exemption from the application of subsection 8.2(2) of the Air Transportation Regulations (hereinafter the ATR), which requires the filing of an application for an approval at least forty-five 45 days before the first planned flight.

Under Licence No. 000097, Air Canada is authorized to operate a scheduled international service using, inter alia, all-cargo aircraft in accordance with the Civil Air Transport Agreement between the Government of Canada and the Government of the People's Republic of China signed on June 11, 1973 (hereinafter the Agreement).

With respect to the request for an exemption from the application of subsection 8.2(2) of the ATR, the Agency has considered the request and is of the opinion that compliance by Air Canada with subsection 8.2(2) of the ATR is impractical in this case.

Accordingly, the Agency, pursuant to paragraph 80(1)(c) of the Canada Transportation Act (hereinafter the CTA), hereby orders that Air Canada be exempt from the application of subsection 8.2(2) of the ATR.

The Agency has reviewed and considered the application and the material filed in support thereof and is satisfied that it meets the remaining requirements of section 8.2 of the ATR.

With respect to the requested period of approval, the Agency is of the opinion that approval should be granted for a period of one year.

Accordingly, the Agency, pursuant to paragraph 60(1)(b) of the CTA and section 8.2 of the ATR, hereby approves the use by Air Canada of aircraft and flight crew provided by World Airways, and the provision by World Airways of such aircraft and flight crew to Air Canada, in order to permit Air Canada to provide its scheduled international all-cargo service on licensed routes between Toronto and Shanghai, using aircraft and flight crew provided by World Airways, from May 15, 2005 to May 14, 2006, subject to the following conditions:

  1. Air Canada shall continue to hold the required licence authorities.
  2. Commercial control of the flights shall be maintained by Air Canada. World Airways shall maintain operational control of the flights and shall receive payment based on the rental of aircraft and crew and not on the basis of the volume of traffic carried or other revenue-sharing formula.

Air Canada and World Airways are reminded to advise the Agency in advance of any changes to the information provided in support of the subject application.

Air Canada and World Airways are further reminded of the continuing requirement to comply with sections 8.2 and 8.5 of the ATR.

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

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