Agreement, and thus has acted contrary to the Government of China’s obligations under Annex I, Section I; Annex V; and Article 12(2) of the Agreement.
In light of these facts, which present a situation in which the Chinese aviation authorities have authorized no U.S. carrier scheduled passenger operations between the United States and China, we conclude that these circumstances require the Department’s action to restore a competitive balance and fair and equal opportunity among U.S. and Chinese air carriers in the scheduled passenger service marketplace. We, therefore, conclude that the public interest requires the suspension of all Chinese carrier scheduled passenger air services between the United States and China.[1] We will effectuate this under the Part 213 process by requiring all the affected Chinese carriers to reduce their level of scheduled passenger frequencies to zero.
Our overriding goal is not the perpetuation of this situation, but rather an improved environment wherein the carriers of both parties will be able to exercise fully their bilateral rights. Should the CAAC adjust its policies to bring about the necessary improved situation for U.S. carriers, the Department is fully prepared to revisit the action it has announced in this order.
ACCORDINGLY,
1. We disapprove all of the existing schedules for combination services filed by Air China Limited d/b/a/ Air China; China Eastern Airlines Corporation Limited; China Southern Airlines Company Limited; and Xiamen Airlines pursuant to Order 2020-5-4;
2. The disapproval specified in Ordering Paragraph 1 shall be effective on June 16, 2020, or otherwise immediately upon affirmative approval by the President of the United States;
3. We may amend, modify, or revoke this Order at any time and without hearing; and
4. We will serve this Order on Air China Limited d/b/a/ Air China; Beijing Capital Airlines Co., Ltd.; China Eastern Airlines Corporation Limited; China Southern Airlines Company Limited; Hainan Airlines Holding Co. Ltd.; Sichuan Airlines Co., Ltd.; and Xiamen Airlines; all certificated U.S. carriers operating large aircraft; the Embassy of the People’s Republic of China
- ↑ The Department has learned through diplomatic channels that Chinese carriers may be using passenger charter operations as a way of circumventing the CAAC Notice limitations on scheduled passenger services and thereby further increasing their advantage over U.S. carriers in providing U.S.-China passenger services. The Department is also concerned that some of the applications submitted to it for a number of these charter operations may not have accurately reflected the true nature of the services involved. All such charters are subject to prior approval by the Department, and, in light of these concerns, as well as the failure of China to honor the ability of U.S. carriers to exercise the rights to which they are entitled under the Agreement to operate scheduled passenger service, the Department intends to exercise its prior approval power as to any future Chinese carrier passenger charter applications with the highest degree of scrutiny. No Chinese carrier should assume that approval of any such applications will necessarily be forthcoming.
