1466; EAS 431; 11 Bevans 825; entered into force, Jan. 1, 1945. It was amended: Aug. 6, 1954 (TIAS 3013; 5 UST 1411); July 8, 1958 (TIAS 4073; 9 UST 1012); June 7, 1966 (TIAS 6026; 17 UST 743); and Aug. 2, 1983 (TIAS ).

In an agreement dated Feb. 8, 1951, the air transport companies of Denmark, Norway, and Sweden established a consortium, Scandinavian Airlines System (SAS), for the operation of air services. A subsequent agreement of the three Governments provided for cooperation of their civil aviation authorities with respect to SAS operations. Agreement between Denmark, Norway, and Sweden Regarding Cooperation in the Field of Civil Aviation, signed at Oslo, Dec. 20, 1951, entered into force, May 28, 1952 (163 UNTS 293); as amended by the Additional Protocol signed at Oslo, Aug. 20, 1959, entered into force, Aug. 20, 1959 (344 UNTS 324). The text of the SAS consortium agreement, as amended Mar. 26, 1962, and Apr. 1, 1974, may be found at Dept. of State File No. P86 0105-0090.

-J.R.B.

United States-United Kingdom

On December 4, 1980, the United States and the United Kingdom exchanged notes at Washington amending their Agreement Concerning Air Services of July 23, 1977 (TIAS 8641; 28 U.S.T. 4309; entered into force, July 23, 1977), as amended.

The amending Agreement provided for a major expansion of operating rights through 1984, including the inauguration or expansion of services at Denver, Boston, Miami, St. Louis, New Orleans, and other United States cities to be selected by the Governments. It also provided for British authorities to authorize airline service from Belfast to the United States. Under the 1980 amendment an airline commencing service at a new gateway point is to receive market development protection (the exclusive right to provide nonstop service) for a period not to exceed three years. The amending Agreement included a new Annex 5 to the 1977 Agreement concerning Air Services, that liberalized North Atlantic air cargo operations over several years.

In connection with the exchange of notes, representatives of the two Governments exchanged three sets of letters on December 4, 1980, regarding: (1) the use of airports (to accommodate the British policy of expanding the range of services at London's Gatwick Airport and reducing congestion at Heathrow); (2) the application of United States antitrust laws; and (3) new gateways and passenger charters.

The exchange of notes signed at Washington, Dec. 4, 1980, together with the related letters, may be found at TIAS 10059; entered into force, Dec. 4, 1980; effective Apr. 1, 19980, except Annex 5, which became effective Jan. 1, 1980.

Research and Development

United States-France

—J.R.B.

On July 10, 1980, the United States Federal Aviation Administration (FAA) and the French Directorate General of Civil Aviation

(Direction Générale de l'Aviation Civile-DGAC) signed a Cooperation Agreement with respect to research and development activities in the field of civil aviation.

The Agreement establishes general terms and conditions under which the FAA and DGAC would combine their work and resources or conduct specific research and development activities, exchange information on research and development undertaken separately, and enter into new programs jointly. In implementation of the Agreement, specific projects would be described in annexes to be agreed subsequently and attached to the Agreement.

Article IV of the Agreement provides for exchange of technical personnel, and Article V sets out conditions covering the exchange of equipment. Article VI requires the joint consent of the parties for presentation of any information or material pertinent to projects or programs to third parties (other than contractors or subcontractors) or to any public forum, as well as for printing and distribution. It also prohibits the FAA from releasing information under the Freedom of Information Act which DGAC or its contractor has transmitted and which has been marked proprietary under the Act's exemption for such information [5 U.S.C. 552 (b)(4)]. The parties are to discuss jointly any request for information made under the Act.

The Cooperation Agreement signed at Washington and Paris, July 10, 1980, is at TIAS 9881; 32 UST 2873; entered into force, July 10, 1980.

In Schmidkunz v. Scandinavian Airlines System, 628 F.2d 1205 (9th Cir. 1980), a three-judge panel of the United States Court of Appeals for the Ninth Circuit considered an action against the Kingdom of Denmark, the Copenhagen Airports Authority, and Scandinavian Airlines System (SAS) for negligence in the operation and maintenance of a moving walkway at the Copenhagen airport. On August 15, 1980, the Court affirmed the district court's dismissal of Denmark and the Airports Authority as parties for lack of in personam jurisdiction.

The Court also affirmed the district court's order for summary judgment in favor of SAS, holding that the accident in which the plaintiff was injured did not take place on board or during the "operations of embarking or disembarking" an SAS aircraft within the meaning of Article 17 of the Warsaw Convention.

The Court noted that at the time of the accident the plaintiff had already left the airplane on which she had arrived in Copenhagen, had walked not closer than approximately 500 yards from the boarding gate to the SAS airliner that she was to take, was still within the common passenger area of the terminal, had not received her SAS boarding pass, was not imminently preparing to board the plane, and was not under the direction of SAS personnel. With regard to the plaintiff's argument that a woman who "may have been" an SAS employee had advised her that the walkway was safe, the Court ruled that this was insufficient to require SAS to go to trial in view of the plaintiff's failure to make any attempt at discovery.

The Warsaw Convention (the Convention for the Unification of Certain Rules Relating to International Transportation by Air, with Additional Protocol), concluded at Warsaw, Oct. 12, 1929, is at T.S. 876; 49 Stat. 3000, 2 Bevans 983; entered into force for the United States, Oct. 29, 1934.

$5

-J.R.B.

Domestic Law and Regulation

International Air Transportation Competition Act

On February 15, 1980, President Carter signed the International Air Transportation Competition Act of 1979. The Act (Pub. L. 96-192; 94 Stat. 35; codified at various sections of title 49, United States Code) amends the Federal Aviation Act of 1958 and has among its purposes the promotion of competition in international air transportation, the expansion of opportunities for United States air carriers, and the establishment of goals for developing United States international aviation negotiating policy. The Act creates a "standard foreign fare level" to permit fare flexibility in international air transportation. Section 17 of the Act (49 U.S.C. 1502(b)) sets out detailed goals for United States international aviation policy which emphasize "the greatest degree of competition that is compatible with a wellfunctioning international air transportation system." These goals include a strengthened competitive position for United States airlines, freedom to offer fares corresponding to demand, minimal restrictions on charters, maximum international authority for United States airlines to respond quickly to demand, elimination of operational and marketing restrictions, integration of domestic and international air transportation, more United States gateways, increased foreign carrier access to the United States if exchanged for permanently linked benefits for United States airlines or the traveling public, elimination of discrimination and unfair competitive practices faced by United States airlines abroad, and promotion of civil aeronautics and a privately owned United States air trans

port industry. The Act amends various technical provisions of the Federal Aviation Act to conform them with these policy goals.

The concept of "standard foreign fare level" (SFFL) established by section 24 of the Act resembles the "standard industry fare level" (SIFL) created under section 37 of the Airline Deregulation Act of 1978 (49 U.S.C. 1482(d)). SFFLs are based on fares in effect on October 1, 1979, but may be set at different levels if determined by the Civil Aeronautics Board (CAB) to be unjust or unreasonable. Subject only to narrow exceptions, airlines are permitted to set fares within a zone of 5% above and 50% below a SFFL. SFFLs are to be adjusted at least every 60 days to reflect changes in fuel costs and at least every 180 days to reflect changes in other costs.

Other important provisions of the Act: (1) authorize retaliatory measures to protect United States airlines from unjustifiable or unreasonable foreign practices; (2) permit foreign air carriers to perform interstate or overseas transportation for up to 30 days in certain emergencies; (3) extend the prohibition of “part charters” until December 31, 1981; (4) make applicable to all forms of intercarrier agreements the modified bank merger/local cartage text, with international comity and foreign policy considerations being added to the public interest factors which may justify an otherwise anticompetitive agreement; and (5) amend the "Fly America" program to relax limits on the use of foreign airlines between foreign points and, more generally, to permit foreign airlines to carry United States Government-financed passengers pursuant to international agreements meeting certain criteria.

Cargo

Charter Operations

-J.R.B.

On August 1, 1980, the Civil Aeronautics Board (CAB) adopted five related final rules to remove virtually all remaining limitations on cargo charters for both United States and foreign carriers (45 Fed. Reg. 53358 (1980), amending 14 C.F.R. Part 207; 45 Fed. Reg. 53363 (1980), amending 14 C.F.R. Part 208; 45 Fed. Reg. 53364 (1980), amending 14 C.F.R. Part 212; 45 Fed. Reg. 53365 (1980), amending 14 C.F.R. Part 214; and 45 Fed. Reg. 53366 (1980), amending 14 C.F.R. Part 241).

Consistent with the CAB's policy encouraging maximum competition in charter services, the final rules: (1) eliminate restrictions on off-route charter flights by scheduled air carriers and the requirement for carriers to report their off-route charter operations; (2) allow cargo to be carried on the main deck along with passengers on charter flights; (3) eliminate the requirement that all the available

cargo space be engaged before a charter flight is operated (thus permitting operation of less-than-fully-engaged aircraft); (4) allow charter cargo to travel on scheduled flights ("part charters"); and (5) permit foreign charter-only carriers to operate cargo charter flights without restriction within the scope of their permits, except that the CAB retains the right to require prior approval for such flights where a carrier's home government does not provide similar opportunities to United States air carriers.

Cargo/Passengers

In response to a petition by the National Air Carrier Association, the CAB proposed in January 1980 to amend its requirement for prior authorization of charters by foreign air carriers (45 Fed. Reg. 2331 (1980), to amend 14 C.F.R. Parts 207, 208, 212, 214, and 249). Under this proposal, prior authorization would normally be required for "fifth freedom" charters (between the United States and a country other than the home country of the carrier), but not for "off-route" charters as mandated by existing regulations. The CAB considered this new approach more closely related to the problems of reciprocity which the regulations seek to address. The CAB also proposed to consolidate its regulations governing charters by foreign air carriers into Part 212 of the Code of Federal Regulations and to delete certain requirements applicable to pro rata (affinity) charters which the CAB considered to serve no useful purpose.

On May 8, 1981, the CAB adopted a final rule consistent in essential elements with the 1980 proposal (46 Fed. Reg. 28368 (1981)).

Passengers

In July 1980, the CAB issued a notice of proposed rulemaking (45 Fed. Reg. 46812 (1980)), to amend 14 C.F.R. Parts 207, 208, 212, and 214 by eliminating the force majeure clause found in most charter contracts, through which airlines exempt themselves from the obligation to return stranded charter passengers. The presence of such a clause in the contract between an airline and a charter operator means that the airline is liable only to refund to the operator that portion of the operator's payment attributable to the unperformed air transportation. The charter operator, however, is required pursuant to 14 C.F.R. 380.32(k) to secure substitute transportation for the stranded passengers, almost always at a cost greater than the refund from the airline.

The effect of the amendments proposed by the CAB would be to require airlines to provide, or arrange for, return transportation of charter passengers stranded by a strike or other interruption of the airline's service. The amendments are also drafted to prohibit contract provisions between airlines and charter operators to pass