BEFORE THE U.S. DEPARTMENT OF TRANSPORTATION WASHINGTON, DC APPLICATION OF TACA INTERNATIONAL AIRLINES, S.A. FOR A STATEMENT OF AUTHORIZATION

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1 BEFORE THE U.S. DEPARTMENT OF TRANSPORTATION WASHINGTON, DC i3 :--* i - t5 r I- p 2: 55 Application of ) TACA INTERNATIONAL AIRLINES7 S.A. ) ( TACA ) ) Docket OST %- / for Statement of Authorization pursuant to ) 4 C.F.R. 22 ) APPLICATION OF TACA INTERNATIONAL AIRLINES, S.A. FOR A STATEMENT OF AUTHORIZATION Communications with respect to this document should be sent to: John H. Cravens Edificio Caribe San Salvador, El Salvador John R. Brimsek Mullenholz & Brimsek 50 Connecticut Avenue, NW, Suite 700 Washington, DC (503) Telephone (202) Telephone (503) Fax (202) Fax jcravens@taca.com jrb@,mbblawyers.com Director of Legal Affairs for Gmpo TACA Counsel for TACA International Airlines, S.A. DATED: August 3,2004

2 ~ BEFORE THE U.S. DEPARTMENT OF TRANSPORTATION WASHINGTON, DC Application of TACA INTERNATIONAL AIRLINES, S.A. ) ( TACA ) ) Docket OST for Statement of Authorization pursuant to ) 4 C.F.R. 22 ) APPLICATION OF TACA INTERNATIONAL AIRLINES, S. A. FOR A STATEMENT OF AUTHORIZATION TACA International Airlines, S. A. ( TACA ) hereby requests that the Department issue a Statement of Authorization pursuant to 4 C.F.R. Part 22 permitting TACA to carry the code of Iberia Lineas Aereas de Espana, S.A. ( Iberia ) on TACA flights between Miami, Florida and certain points in Central America for the purpose of transporting Iberia traffic between Central America and Spain. The authorization is requested for an indefinite period. TACA and Iberia desire to implement the code-share service on or about October,2004. In support of this application, TACA states as follows:. TACA holds underlying Open Skies route authority from points behind El Salvador via El Salvador and intermediate points to a point or points in the United States and beyond. Docket OST Iberia holds exemption authority to provide service between any point or points in Spain and Miami, via San Juan, and beyond Miami to/from coterminal TACA respectfully requests expeditious processing of this application so that marketing of this service may begin without delay.

3 points including Guatemala City, Guatemala; San Salvador, El Salvador; Managua, Nicaragua; and San Pedro Sula, Honduras. Notice of Action Taken, December 5,2003, Docket OST Under the arrangement, TACA will carry Iberia s code on the following routes which will connect with Iberia s service between Miami and Spain: Miami-San Pedro Sula-Miami Miami-Guatemala City-Miami Miami-Managua-Miami Miami-San Salvador-Miami Each of the non-san Salvador points is served as either a behind or intermediate point on TACA s operations between the United States and El Salvador as required by the United States-El Salvador Open Skies agreement. Only traffic between the above Central America points and Spain will be transported under the Iberia code on the TACA code-share flights. Iberia will not sell travel between those Central American points and the U.S. for movement on the code-share flights. 3. The proposed arrangement is fully consistent with the U.S.-E Salvador Open Skies Agreement which contains the liberal model code-share provision that authorizes thirdcountry carrier code-sharing. See U.S.-El Salvador Air Services Agreement, Art. 8. The Department has previously granted similar authority permitting TACA to carry Air France s code between Central American points and Miami. Docket OST TACA and Iberia will comply with the Department s policies and rules concerning code-sharing arrangements including (a) the requirement that the contract of carriage and the TACA s authority remains in effect as the result of a renewal application timely filed with the Department on September, 999 invoking the automatic extension provisions of the Adrmnistrative Procedures Act and Part 2

4 ticket reflect the carrier that is holding out the service, (b) the requirement that the carrier holding out the service accepts responsibility to its passengers according to the terms of its contract of carriage, and (c) the requirements of Part 257 with respect to giving reasonable and timely notice to actual and prospective passengers of the code-sharing arrangements. 5. Approval of the code-share arrangements will permit Iberia to provide single carrier service between Spain and points in Central America and thereby enhance its presence in the market. It also will be able to offer travelers the benefits of such service such as ease in ticketing and baggage handling. In addition, approval will improve the economics of TACA s service between Miami and Central American points which also will benefit the traveling public. Thus, the approval of the arrangement is consistent with the public interest. For all the foregoing reasons, TACA respectfully requests that the Department grant a Statement of Authorization to conduct the proposed operations. Respectfully submitted, DATED: August 3, of the Department s procedural regulations. 3

5 CERTIFICATE OF SERVICE I hereby certify that a copy of the for Authorization has this day been served on all telecopier, or first class mail, postage prepaid. DATED: August 3,2004 Carl.nelson@aa.com Sascha.vanderbellen@shawpittman.com Megan.rosia@nwa.com anbirdafedex. com dvaughan@kelleydrye.com prizzi@omm.com Jyoung@bakerlaw. com hkamen@coair.com jmanley@wilmer.com mcmillin@woa.com epfaberman@uhlaw.com j hill@dlalaw.com com anitamosner@gcwconsulting.com wkaras@steptoe.com cgosain@steptoe.com Director of Flight Standards U.S. Federal Aviation Administration 800 Independence Avenue, S.W. Room 82-AFS- Washington, DC 2059 Angela Gittens Director Miami-Dade Aviation Department P.O. Box AMF Miami, Florida