Decision No. 679-A-2000

October 27, 2000

October 27, 2000

APPLICATION by Air Canada, on behalf of itself and Singapore Airlines Limited, 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, while providing its scheduled international services between points in Canada and Singapore, to sell transportation in its own name on flights operated by Singapore Airlines Limited, and to permit Singapore Airlines Limited, while providing its scheduled international services between Canada and Singapore, to sell transportation in its own name on flights operated by Air Canada and its subsidiary, Canadian Airlines International Ltd., commencing October 29, 2000.

File No. M4820/S3

Docket No. 000872AG


Air Canada, on behalf of itself and Singapore Airlines Limited (hereinafter Singapore Airlines), has applied to the Canadian Transportation Agency (hereinafter the Agency) for the approval set out in the title. The application was received on September 12, 2000 and amended on October 5, 18 and 23, 2000.

The applicants submit that the proposed services are necessary to provide the best possible competitive air services between Canada and Singapore in terms of, amongst other things, public convenience, frequency, cost and quality of service.

Under Licence Nos. 000153 and 965000, Air Canada and Singapore Airlines are respectively authorized to operate a scheduled international service in accordance with the Arrangement on Air Transport between the Government of Canada and the Government of the Republic of Singapore contained in an Agreed Minute signed on August 15, 1992 (hereinafter the Arrangement).

Condition No. 1 of Licence Nos. 000153 and 965000 reads as follows:

The Licensee is authorized to operate the route(s) set out in the Arrangement.

Condition No. 2 of Licence Nos. 000153 and 965000 reads as follows:

The operation of the scheduled international service authorized herein shall be conducted subject to the provisions of the Arrangement.

The Agency has reviewed and considered the application and the material filed in support thereof and notes that the proposed services are not entirely provided for in the Arrangement.

Air Canada proposes to provide thrice-weekly service on the routing Vancouver-Seoul-Singapore by applying its own code to flights operated by Singapore Airlines. Air Canada also proposes to provide services on the routings Toronto-London (U.K.)-Singapore and Toronto-Copenhagen-Singapore by applying its own code to flights operated by Singapore Airlines between London and Singapore and between Copenhagen and Singapore. In addition to its current thrice-weekly service on a Singapore-Seoul-Vancouver routing using its own aircraft, Singapore Airlines proposes to serve the Toronto-London-Singapore and Toronto-Copenhagen-Singapore routings, by applying its own code to flights operated by Air Canada between Toronto and London and between Toronto and Copenhagen and to the flights operated by Canadian Airlines International Ltd. (hereinafter Canadi*n) between Toronto and London. The Arrangement, however, only provides for each of Air Canada and Singapore Airlines to operate three flights per week in each direction on a Vancouver-Seoul-Singapore routing with full traffic rights using a B747 or smaller aircraft, and it does not provide for code-sharing. Air Canada and Singapore Airlines recognized the extra-bilateral aspects of their proposal by seeking extra-bilateral authority in separate licence applications. The Agency will address the extra-bilateral aspects of the proposed services in this Decision.

In its consideration of this application, the Agency has determined that in order to operate as proposed, conditions of Air Canada's Licence No. 000153 and of Singapore Airlines' Licence No. 965000 should be varied to allow services not permitted under the Arrangement. The Agency has also taken into consideration a letter dated March 6, 2000 from Canada's Chief Air Negotiator addressed to the Singapore authorities advising that the Canadian authorities are prepared to give favourable consideration, on an extra-bilateral basis, to the code-sharing services jointly agreed to by Air Canada and Singapore Airlines, provided that normal regulatory requirements are met.

With respect to the duration of the approval and the licence condition variances that would permit the operation of the proposed services, the Agency is of the opinion that, particularly in view of the extra-bilateral aspects of the proposed services, such variances and the approval should be limited to the 2000/2001 IATA Winter Season. The Agency notes that Singapore Airlines has submitted evidence that, in compliance with section 8.2 of the Air Transportation Regulations (hereinafter the ATR), it has included Air Canada as an additional insured under its Certificate of Insurance which is effective November 1, 2000. Singapore Airlines, however, has not submitted evidence of compliance for the period from October 29 to October 31, 2000. The Agency, therefore, is not willing to allow Air Canada to use aircraft and flight crew provided by Singapore Airlines before November 1, 2000.

Accordingly, the Agency, pursuant to subsection 78(2) of the Canada Transportation Act (hereinafter the CTA), hereby varies Conditions Nos. 1 and 2 of Air Canada's Licence No. 000153 to permit it to provide services between Canada and Singapore via each of Seoul, London and Copenhagen by applying its own code to flights operated by Singapore Airlines between London and Singapore, between Copenhagen and Singapore, and between Vancouver and Singapore, via Seoul, from November 1, 2000 to March 24, 2001. In addition, the Agency hereby varies Conditions Nos. 1 and 2 of Singapore Airlines' Licence No. 965000 to permit it to provide services between Toronto and Singapore via each of London and Copenhagen by applying its own code to flights operated by Air Canada between Toronto and London and between Toronto and Copenhagen and to the flights operated by Canadi*n between Toronto and London, from October 29, 2000 to March 24, 2001.

With respect to Air Canada's and Singapore Airlines' request for approval under section 60 of the CTA and section 8.2 of the ATR, the Agency is satisfied that the application meets the remaining requirements set out in section 8.2 of the ATR.

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 Singapore Airlines, and the provision by Singapore Airlines of such aircraft and flight crew to Air Canada, to permit Air Canada, while providing its scheduled international services between Canada and Singapore via Seoul, London and Copenhagen, to sell transportation in its own name on flights operated by Singapore Airlines between London and Singapore, between Copenhagen and Singapore and between Vancouver and Singapore, via Seoul, from November 1, 2000 to March 24, 2001. In addition, the Agency hereby approves the use by Singapore Airlines of aircraft and flight crew provided by Air Canada and Canadi*n, and the provision by Air Canada and Canadi*n of such aircraft and flight crew to Singapore Airlines, to permit Singapore Airlines, while providing its scheduled international services between Toronto and Singapore via London and Copenhagen, to sell transportation in its own name on flights operated by Air Canada between Toronto and London and between Toronto and Copenhagen and on flights operated by Canadi*n between Toronto and London, from October 29, 2000 to March 24, 2001. These approvals are subject to the following conditions:

  1. Air Canada and Singapore Airlines shall hold the required licence authorities.
  2. The air services approved herein shall only be provided as long as the Code Share Agreement between Air Canada, on behalf of itself and Canadi*n, and Singapore Airlines effective October 23, 2000 (hereinafter the Code Share Agreement), providing for such services, remains in effect.
  3. Air Canada and Singapore Airlines shall apply their respective published tariffs, on file with the Agency and in effect, to the carriage of their traffic. In particular, nothing in any commercial agreement between the air carriers relating to limits of liability shall diminish the rights of passengers as stated in such tariffs.
  4. Air transportation using Air Canada's code on flights between Seoul and Singapore, between London and Singapore, and between Copenhagen and Singapore shall be available only as part of a continuous journey between Canada and Singapore under Air Canada's code. No local traffic may be carried under Air Canada's code between these points; however, stopovers for Air Canada's passengers are permitted at Seoul, London and Copenhagen.
  5. Air transportation using Singapore Airlines' code on flights between London and Toronto and between Copenhagen and Toronto shall be available only as part of a continuous journey between Singapore and Toronto under Singapore Airlines' code. No local traffic may be carried under Singapore Airlines' code between these points; however, stopovers for Singapore Airlines' passengers are also permitted at Copenhagen and London.

Air Canada, Canadi*n and Singapore Airlines are reminded of the continuing requirement to comply with sections 8.2 and 8.5 of the ATR.

Air Canada and/or Singapore Airlines are further reminded to provide the Agency with a copy of any amendments to their Code Share Agreement or any new or amended annexes, upon signature.

The approval granted herein does not exempt Air Canada, Canadi*n and Singapore Airlines from the requirements of other legislative acts or regulations, including those of Transport Canada.

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