[Federal Register Volume 67, Number 150 (Monday, August 5, 2002)]
[Notices]
[Page 50745]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-19810]


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DEPARTMENT OF TRANSPORTATION

Office of the Secretary


Review Under 49 U.S.C. 41720 of United/US Airways Agreements

AGENCY: Office of the Secretary, Department of Transportation.

ACTION: Notice requesting comments.

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SUMMARY: United Air Lines and US Airways have submitted agreements to 
the Department for review under 49 U.S.C. 41720. That statute requires 
certain types of agreements between major U.S. passenger airlines to be 
submitted to the Department at least thirty days before the agreements' 
proposed effective date but does not require Department approval for 
the agreements. The Department may extend the waiting period for either 
or both of the United/US Airways agreements at the end of the thirty-
day period or take other appropriate action. The Department is inviting 
interested persons to submit comments that would assist the Department 
in determining whether further action should be taken.

DATES: Any comments should be submitted by August 15, 2002.

ADDRESSES: Comments must be filed with Randall Bennett, Director, 
Office of Aviation Analysis, Room 6401, U.S. Department of 
Transportation, 400 7th St. SW., Washington, DC 20590. Late filed 
comments will be considered to the extent possible. To facilitate 
consideration of comments, each commenter should file three copies of 
its comments.

FOR FURTHER INFORMATION CONTACT: Thomas Ray, Office of the General 
Counsel, 400 Seventh St. SW., Washington, DC 20590, (202) 366-4731.

SUPPLEMENTARY INFORMATION: Congress enacted a provision, 49 U.S.C. 
41720, that requires certain kinds of joint venture agreements among 
major U.S. passenger airlines to be submitted to the Department at 
least thirty days before they can be implemented. This requirement 
covers code-sharing agreements, long-term wet leases involving a 
substantial number of aircraft, and agreements concerning frequent 
flyer programs. The requirement would also cover certain other 
significant cooperative working arrangements designated by regulation. 
By publishing a notice in the Federal Register, we may extend the 
waiting period by 150 days with respect to a code-sharing agreement and 
by sixty days for the other types of agreements covered by the advance-
filing requirement. At the end of the waiting period (either the 
thirty-day period or any extended period implemented by us), the 
parties are free to implement their agreement. We may also allow the 
joint venture agreement to be implemented before the thirty-day waiting 
period expires.
    The statute does not require the parties to obtain our approval 
before they implement an agreement. To block two airlines from 
implementing an agreement, we would normally need to issue an order 
under 49 U.S.C. 41712 (formerly section 411 of the Federal Aviation 
Act) in a formal enforcement proceeding that determines that the 
agreement's implementation would be an unfair or deceptive practice or 
unfair method of competition that would violate that section.
    We have not adopted regulations expanding the scope of the filing 
requirement or establishing procedures for our review of agreements 
submitted under 49 U.S.C. 41720.
    In the past we have informally conducted the reviews authorized by 
49 U.S.C. 41720. The airline parties to a joint venture agreement have 
filed the agreement directly with the Department staff that reviews 
them, we have not established a docketed proceeding on any such 
agreement, and we have not sought comments from other parties. In 
determining whether to extend the waiting period (or start a formal 
proceeding under section 41712), we have focused on whether the 
agreement would reduce competition. Our review is analogous to the 
review of major mergers and acquisitions conducted by the Justice 
Department and the Federal Trade Commission under the Hart-Scott-Rodino 
Act, 15 U.S.C. 18a, since we are considering whether we should 
institute a formal proceeding for determining whether an agreement 
would violate section 41712. We consult the Justice Department as part 
of our review, and we avoid unnecessary duplication of efforts by the 
Justice Department and this Department. If an agreement appears to 
violate the antitrust laws, the Justice Department may file suit and 
seek injunctive relief against the parties to the agreement.
    On July 25 United and US Airways submitted code-share and frequent 
flyer program reciprocity agreements for review under 49 U.S.C. 41720. 
We still intend to conduct an informal review, but, due to the public 
interest in these agreements, we want to give interested persons an 
opportunity to submit comments. The views of outside parties may assist 
us in determining whether to extend the waiting period and whether 
either agreement presents serious issues under section 41712.
    Since the statute requires us to decide within thirty days of 
filing to determine whether to extend the waiting period, we request 
that any comments be filed by August 15. To assist the commenters, 
United and US Airways have prepared a redacted copy of the agreements 
that will be available for review and copying in room PL-401 of the 
Nassif Building, located in the northeast corner on the Plaza level, 
400 7th St. SW., Washington, DC. We are making the copy available 
there, even though this case is not docketed, because it is readily 
accessible to the public and has a copying machine for public use.

    Issued in Washington, DC on August 1, 2002.
Read C. Van de Water,
Assistant Secretary for Aviation and International Affairs.
[FR Doc. 02-19810 Filed 8-1-02; 2:33 pm]
BILLING CODE 4910-62-P