Decision No. 443-A-2014
APPLICATION by WestJet, on behalf of itself and Thomas Cook Airlines Limited, pursuant to section 60 of the Canada Transportation Act, S.C., 1996, c. 10, as amended, and section 8.2 of the Air Transportation Regulations, SOR/88-58, as amended.
WestJet, on behalf of itself and Thomas Cook Airlines Limited (Thomas Cook), has applied to the Canadian Transportation Agency (Agency) for an approval to permit WestJet to provide its scheduled international service between Canada and the United States of America using two aircraft with flight crew provided by Thomas Cook, beginning on December 9, 2014 to April 27, 2015.
WestJet is licensed to operate a scheduled international service in accordance with the Air Transport Agreement between the Government of Canada and the Government of the United States of America signed on March 12, 2007.
In its application filed on August 25, 2014, WestJet states that it has 104 aircraft on its Air Operator Certificate (AOC).
When assessing wet-lease applications where Canadian carriers propose to enter into wet-lease arrangements of more than 30 days with foreign carriers to provide international passenger services, the Agency must apply a direction issued by the Minister of Transport on June 24, 2014 entitled Ministerial Direction for International Service – Canada’s Policy for Wet-Leasing (2014 Wet-Lease Policy), and must specifically ensure that the 20-percent cap is respected at the time of application.
Is the Agency satisfied that WestJet’s application meets the requirements of section 8.2 of the Air Transportation Regulations (ATR) and the criteria of the 2014 Wet-Lease Policy, specifically the 20‑percent cap?
ANALYSIS AND FINDINGS
Section 60 of the Canada Transportation Act (CTA) requires that a licensee obtain, where prescribed, an approval from the Agency prior to using aircraft with flight crew provided by another person.
Section 8.2 of the ATR sets out the information to be included in an application and the requirements to be met for an approval pursuant to section 60 of the CTA.
Pursuant to the 2014 Wet-Lease Policy, for wet-leases of more than 30 days, a number of aircraft equal to 20 percent of the number of Canadian-registered aircraft on the lessee’s AOC may be wet leased from foreign lessors. The Agency notes that WestJet has 104 aircraft on its AOC and, therefore, the use of two wet-leased aircraft is well below the 20-percent cap.
On matters of international reciprocity, the Agency’s general practice is that reciprocity by the authorities of the lessorʼs country of origin, in this case the United Kingdom of Great Britain and Northern Ireland, is assumed unless evidence is brought to the contrary. The Agency is not aware of any similar application by a Canadian carrier to the aeronautical authorities of the European Union and its Member States that has been denied. Therefore, the Agency finds that international reciprocity is not a concern in this case.
The Agency has considered the application and the material in support and is satisfied that it meets the requirements of section 8.2 of the ATR. The Agency is also satisfied that the application satisfies the criteria of the 2014 Wet-Lease Policy.
Accordingly, the Agency, pursuant to paragraph 60(1)(b) of the CTA and section 8.2 of the ATR, approves the use by WestJet of two aircraft with flight crew provided by Thomas Cook, and the provision by Thomas Cook of such aircraft and flight crew to WestJet, to permit WestJet to provide its scheduled international service on licensed routes between Canada and the United States of America using two aircraft with flight crew provided by Thomas Cook, beginning on December 9, 2014 to April 27, 2015.
This approval is subject to the following conditions:
- WestJet shall continue to hold the valid licence authority.
- Commercial control of the flights shall be maintained by WestJet. Thomas Cook 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.
- WestJet and Thomas Cook shall continue to comply with the insurance requirements set out in subsections 8.2(4), 8.2(5) and 8.2(6) of the ATR.
- WestJet shall continue to comply with the public disclosure requirements set out in section 8.5 of the ATR.
- WestJet and Thomas Cook shall advise the Agency in advance of any changes to the information provided in support of the application.