dismissedusairways

BEFORETHEDEPARTMENTOFTRANSPORTATIONWASHINGTON,D.
C.
ApplicationofNORWEGIANAIRINTERNATIONALLIMITEDforanexemptionunder49U.
S.
C.
§40109andaforeignaircarrierpermitpursuantto49U.
S.
C.
§41301(U.
S.
-EUOpenSkies)))))))))DocketDOT-OST-2010-0204JOINTREPLYOFDELTAAIRLINES,INC.
,UNITEDAIRLINES,INC.
,AMERICANAIRLINES,INC.
ANDUSAIRWAYS,INC.
Communicationswithrespecttothisdocumentshouldbeaddressedto:HowardKassVicePresident--RegulatoryAffairsAmericanAirlinesGroupInc.
1401HStreet,NWWashington,DC20005202-326-5153Howard.
Kass@usairways.
comRobertA.
WirickManagingDirector,RegulatoryandInternationalAffairsAmericanAirlinesGroup,Inc.
P.
O.
Box619616,MD5635DFWAirport,Texas75161(817)963-0394robert.
wirick@aa.
comHershelI.
KamenSeniorVicePresident–Alliances,RegulatoryandPolicyDanielA.
WeissManagingDirector–InternationalAffairsandRegulatoryUNITEDAIRLINES,INC.
233SouthWackerDrive10thFloor–HDQIZChicago,IL60606(872)825-6828hershel.
kamen@united.
comdan.
weiss@united.
comAlexanderVanderBellenManagingDirector–RegulatoryandInternationalAffairs&AssociateGeneralCounselChristopherWalker,RegionalDirector–RegulatoryandInternationalAffairsDELTAAIRLINES,INC.
1212NewYorkAvenue,N.
W.
Washington,D.
C.
20005(202)842-4184sascha.
vanderbellen@delta.
comDecember20,2013BEFORETHEDEPARTMENTOFTRANSPORTATIONWASHINGTON,D.
C.
ApplicationofNORWEGIANAIRINTERNATIONALLIMITEDforanexemptionunder49U.
S.
C.
§40109andaforeignaircarrierpermitpursuantto49U.
S.
C.
§41301(U.
S.
-EUOpenSkies)))))))))DocketDOT-OST-2010-0204JOINTREPLYOFDELTAAIRLINES,INC.
,UNITEDAIRLINES,INC.
,AMERICANAIRLINES,INC.
ANDUSAIRWAYS,INC.
Delta,United,AmericanandUSAirways(the"JointCarriers")appreciatethisopportunitytoreplytotheissuesraisedbyALPAandA4AintheirAnswerstoNorwegianAirInternational's(NAI)applicationforDOTcertificateandexemptionauthority.
TheJointCarriersurgethatNAI'sapplicationbedeniedbecauseitiscontrarytotheexpressprovisionsoftheU.
S.
-EUAirTransportAgreement--specifically,Article17biswhichprohibitstheestablishmentofflagsofconveniencetoevadelaborprotectionsandtherebyderiveacompetitiveadvantageinthemarketplaceandisnotinthepublicinterest.
1AbsenttheU.
S.
-EUmultilateralagreement,NASwouldhavenoexpectationthatitcouldsetupashellcompanyinIrelandtooperateitsaircraftusingimportedlabor,becausestandardbilateralagreementscontain"nationalityclauses"requiringthatcarriersbeownedandeffectivelycontrolledbytheirownnationals.
ThereisnoquestionthatNAIiscontrolledbyNorwegianinterests.
BecausetheEUisacollectionofindividualmemberstates,andtheU.
S.
isgovernedbyasinglesetoffederalaviationandlaborstandards,implementingthe1Iftheapplicationisnotdismissedoutright,theJointCarriersagreewithALPAandA4AthatmanyunansweredquestionsabouttheNAIschemeneedtobeaddressedthroughtheJointCommitteeandonthepublicdocket.
NorwegianJointReplyPage2U.
S.
-EUagreementpresentedspecialchallengestopreventexactlythistypeofforumshoppingandre-flaggingbyEUcarriers.
Forthisreason,thecarefullynegotiatedArticle17bisoftheU.
S.
-EUAgreementrecognizestheimportanceof"highlaborstandards"andthat"theopportunitiescreatedbytheAgreementarenotintendedtounderminelaborstandardsorthelabor-relatedrightsandprinciplescontainedintheParties'respectivelaws.
"TheNAIapplicationsarecontrarytotheseprovisionsandshouldberejectedbecausetheyareinconsistentwiththeU.
S.
-EUAgreement.
AsdetailedinALPA'sAnswer,althoughNAIdoesnotyethaveanIrishaircarriercertificate,itisbeingestablishedinIrelandsothatitsaffiliate,NorwegianAirShuttle,(NAS)canavoidthesociallawsofNorway--allowingNAItoprovidelowerwagesandlessdesirableworkingconditions.
NAI,inturn,willprovideaircraftandflightcrewsformarketingandsaleundertheNorwegianbrandthatwillbeusedincompetitionwithU.
S.
carriersonroutesfromLondontoNewYork,LosAngeles,andFt.
Lauderdale,andfromScandinaviatovariousU.
S.
points.
Inanopenletter,NASthisweekconfirmedthatNAIisbeingestablishedtotakeoveroperationsfromNorwegianLongHaul(NLH),aNorwegiancompanythatcurrentlyprovideslifttoNASusing787aircraft:"TheoperationsforNLHwillendinNorwayandwewillestablishNorwegianAirInternationalLtd.
(NAI)inIreland.
Withthis,allbusinessunderNLHwillbetransferredtoNAI.
"(Attachment1).
Atbottom,NAIandNASseektoestablishanewflagofconvenienceinIrelandtoavoidNorway'slaborlawsandlowerlaborcostsinviolationoftheU.
S.
-EUmultilateralagreement(usingcrewsworkingunderSingaporeemploymentcontracts),thusgivingNAIandNASacompetitiveadvantageontransatlanticroutesindirectcompetitionwithU.
S.
carriers.
AnimportantfocusoftheNAIoperationappearstobepoint-to-pointservicebetweentheU.
S.
andLondon.
TheUS-EUmultilateralisaspecialagreementthatallowsthisextraordinaryprivilegethatwouldotherwisebeprohibited7thfreedomsunderanyotherNorwegianJointReplyPage3bilateral.
But,inordertoreachthisextraordinaryopenness,Art.
17biswasagreedtopreventexactlywhatNAIistryingtodo.
EvenifNAI'splansdidnotspecificallyviolatetheU.
S.
-EUAirTransportAgreement,theapplicationshouldbedismissedbecauseitfailstomeettheDepartment'spublicintereststandard.
UndertheDOT'spublicintereststandard,akeyobjectiveis"strengtheningthecompetitivepositionof[U.
S.
]aircarrierstoatleastensureequalitywithforeignaircarriers.
"49U.
S.
C.
§§40101(a)(15)and(e)(1).
U.
S.
carriers'competitivepositionswouldbeunfairlyandunlawfullycompromisedbyapprovaloftheNAIscheme.
Respectfullysubmitted,/s/AlexanderVanderBellenManagingDirector,RegulatoryandInternationalAffairs&AssociateGeneralCounselDeltaAirLines,Inc.
/s/HowardKassVicePresident--RegulatoryAffairsAmericanAirlinesGroupInc.
/s/RobertA.
WirickManagingDirector,RegulatoryandInternationalAffairsAmericanAirlinesGroup,Inc.
/s/DanWeissManagingDirector–InternationalAffairsandRegulatoryUnitedAirlines,Inc.
CERTIFICATEOFSERVICEAcopyoftheforegoingReplyhasbeenservedthis20thdayofDecember,2013,uponthefollowingpersonsviaemail:romanow@pillsburylaw.
competer.
nelson@pillsburylaw.
comRussell.
Bailey@alpa.
orgsteve.
morrissey@united.
comdan.
weiss@united.
comsascha.
vanderbellen@delta.
comhoward.
kass@usairways.
comrobert.
wirick@aa.
comfrancis.
heil@aa.
comrpommer@atlasair.
commlbenge@zsrlaw.
comjesse.
elliot@faa.
govdouglas.
schwab@faa.
govnicholas.
tsokris@faa.
govjohn.
allen@faa.
govanita.
mosner@hklaw.
comjennifer.
nowak@hklaw.
comnssparks@fedex.
comdberg@airlines.
orgjcasey@airlines.
orgpaul.
gretch@dot.
govbrian.
hedberg@dot.
govesta.
rosenberg@dot.
govbrett.
kruger@dot.
govurskr@state.
govCristinaSA@state.
goveugene_alford@ita.
doc.
govinfo@airlineinfo.
comDearColleagues,As2013drawstoaclose,wepreparetoembarkonanewyearandanewchapterforNorwegian.
Justasin2012,theyearof2013presenteduswithmanyexcitingchallenges.
Wehavebeenthefocusofalotofmediaattentionthisyear,bothpositiveandnegative.
Itcanbechallengingwhenthestrategyofthecompanyisdebatedinthemedia,andnoteverythingisanaccuratereflectionofthesituation.
Thiscanputthecompanyinabadlightandcreateuncertaintyaboutjobsecurity.
NorwegianAirShuttle(NAS)hasreceivedadeliveryof14Boeing737-800aircraftandlaunchednewcrewbasesinSpainandintheUK.
NorwegianLongHaul(NLH)hasreceivedadeliveryof3Boeing787-8andlaunchedanewcrewbaseinThailand.
Withtheseexpansions,wehavewelcomedmanynewcolleagueswhowilljoinusindevelopingourorganisationsinthefuture.
Iamhappyforthewayinwhichournewcolleagueshavebeenwelcomedonboard,bothinternally,andofcourse,bymanyofoursatisfiedcustomers.
Inautumn,itwasannouncedthatNASwouldundergoanorganisationalrestructure.
Inlinewiththesechanges,NASwillnolongeroperateasonecompanyinthefuture,butinstead,operationswillbesetupasnewcompaniesthatwillhandleflightoperationsunderindividualAOCs.
NorwegianAirNorwayAS(NAN)hasnowbeenestablishedandthecompanyhasbeenissueditsownAOC.
ThisorganisationwillhandlealotofNASoperationswiththebasesinNorway,SwedenandDenmark.
NASwillcontinuetooperatebasesoutsideScandinavia.
InJune,NLHcommencedoperatingwithB787-8.
Duetotheinitialissuesexperiencedwiththesecondaircraftthatwasdelivered,wefacedanumberofchallengesinthebeginning.
Thiscausedalotofinconvenienceanddifficultiesforourpassengersandouremployees.
AftertheupgradecompletedbyBoeing,wehavesincedeliveredgoodontimeperformancefortheseoperationsaswell.
TheoperationsforNLHwillendinNorwayandwewillestablishNorwegianAirInternationalLtd.
(NAI)inIreland.
Withthis,allbusinessunderNLHwillbetransferredtoNAI.
Thiswillmeanthattheworklocationformanyofouremployeeswillchange.
Weunderstandthatthisischallengingforboththoseinvolvedandtheirfamilies.
Wehaveemphasisedthatthisshouldbevoluntary.
EstablishingNAIisnecessaryforustogetthetrafficrightsneededoutofEurope,whichwedonothavewithanAOCinNorway.
Allofthechangesthatarenowbeingimplementedaretosecurejobsandreducethecostofoperation,whichinturn,willallowustobemorecompetitiveinthefuture.
Althoughwehavefacedanumberofchallengesduringthelasttwomonths,onawhole,ourpunctualitythisyearhasbeenverygood,andwestrivetoensurethatthesepositiveresultswillcontinueintheyearsahead.
Thankyoutoallofyouwhohavecontributedtothesepositiveresults-werecognisethatthiscouldnotbeachievedwithoutalotofhardworkandclosecollaboration.
ThechangesthatmustnowbemadeinNorwegianwillalsoaffectmeandmyfamily.
WhenNAIisestablishedinIreland,Iwillalsobemovingtooverseetheoperations.
ThiswillmeanthatIwillberesigningfrommyroleasCOOandAccountableManagerforNAS.
IhavehadsomefantasticyearswithNASandIhavebeeninvolvedinmanychallengingtimesthathaveprovidedmewithalotofexperienceandknowledge,whichwillnodoubtbebeneficialformeinthefuture.
AlthoughIwillnolongerberesponsibleforNASoperations,IwillstillcontributetoensurethatNorwegianasagroupwillcontinuetogrowandthriveasacompetitiveaircarrierinthefuture.
IwillnodoubtbeonboardourflightsandwillbesuretovisittheheadquarterswhenIamhereinOslo.
Abigthankyoutoeveryonewhohashelpedtacklethechallengesof2013.
AnextrathankyoutothoseofyouwhohavetoworkduringtheChristmasandNewYearperiodtohelpkeepouroperationsrunningsmoothly.
IwisheveryoneaMerryChristmasandaHappyNewYeartogetherwithyourfamilyandfriends.