Title 14: Aeronautics and Space
Browse Previous | Browse Next
PART 204DATA TO SUPPORT FITNESS DETERMINATIONS
Section Contents
Subpart AGeneral Provisions
204.1 Purpose.
204.2 Definitions.
Subpart BFiling Requirements
204.3 Applicants for new certificate or commuter air carrier
authority.
204.4 Carriers proposing to provide essential air service.
204.5 Certificated and commuter air carriers undergoing or proposing
to undergo substantial change in operations, ownership, or management.
204.6 Certificated and commuter air carriers proposing a change in
operations, ownership, or management which is not substantial.
204.7 Revocation for dormancy.
Authority: 49 U.S.C. Chapters 401, 411, 417.
Source: Docket No. 47582, 57 FR 38766, Aug. 27, 1992, unless otherwise
noted.
Subpart AGeneral Provisions
top
204.1 Purpose.
top
This part sets forth the fitness data that must be submitted by applicants
for certificate authority, by applicants for authority to provide service
as a commuter air carrier to an eligible place, by carriers proposing to
provide essential air transportation, and by certificated air carriers and
commuter air carriers proposing a substantial change in operations,
ownership, or management. This part also contains the procedures and
filing requirements applicable to carriers that hold dormant authority.
[72 FR 20036, Apr. 23, 2007]
204.2 Definitions.
top
As used in this part:
(a) All-cargo air carrier or section 41103 carrier means an air carrier
holding an all-cargo air transportation certificate issued under section
41103 of the Statute authorizing the transportation by aircraft in
interstate air transportation of only property or only mail, or both.
(b) Certificate authority means authority to provide air transportation
granted by the Department of Transportation or Civil Aeronautics Board in
the form of a certificate of public convenience and necessity under
section 41102 of the Statute or an all-cargo air transportation
certificate to perform all-cargo air transportation under section 41103 of
the Statute. Certificated carriers are those that hold certificate
authority.
(c) Citizen of the United States means:
(1) An individual who is a citizen of the United States;
(2) A partnership each of whose partners is an individual who is a citizen
of the United States; or
(3) A corporation or association organized under the laws of the United
States or a State, the District of Columbia, or a territory or possession
of the United States, of which the president and at least two-thirds of
the board of directors and other managing officers are citizens of the
United States, which is under the actual control of citizens of the United
States, and in which at least 75 percent of the voting interest is owned
or controlled by persons that are citizens of the United States.
(d) Commuter air carrier means an air carrier holding or seeking authority
under part 298 of this Chapter that carries passengers on at least five
round trips per week on at least one route between two or more points
according to its published flight schedules that specify the times, days
of the week, and places between which those flights are performed.
(e) Eligible place means a place in the United States that
(1) Was an eligible point under section 419 of the Federal Aviation Act of
1958 as in effect before October 1, 1988;
(2) Received scheduled air transportation at any time between January 1,
1990, and November 4, 1990; and
(3) Is not listed in Department of Transportation Orders 89937 and
891252 as a place ineligible for compensation under Subchapter II of
Chapter 417 of the Statute.
(f) Essential air service is that air transportation which the Department
has found to be essential under Subchapter II of Chapter 417 of the
Statute.
(g) Fit means fit, willing, and able to perform the air transportation in
question properly and to conform to the provisions of the Statute and the
rules, regulations and requirements issued under the Statute.
(h) Interstate air transportation means the transportation of passengers
or property by aircraft as a common carrier for compensation, or the
transportation of mail by aircraft
(1) Between a place in
(i) A State, territory, or possession of the United States and a place in
the District of Columbia or another State, territory, or possession of the
United States;
(ii) Hawaii and another place in Hawaii through the airspace over a place
outside Hawaii;
(iii) The District of Columbia and another place in the District of
Columbia; or
(iv) A territory or possession of the United States and another place in
the same territory or possession; and
(2) When any part of the transportation is by aircraft.
(i) Key personnel include the directors, president, chief executive
officer, chief operating officer, all vice presidents, the directors or
supervisors of operations, maintenance, and finance, and the chief pilot
of the applicant or air carrier, as well as any part-time or full-time
advisors or consultants to the management of the applicant or air carrier.
(j) Normalized operations are those which are relatively free of start-up
costs and temporary barriers to full-scale operations posed by the
carrier's limited experience.
(k) Relevant corporations are the applicant or air carrier, any subsidiary
thereof, any predecessor thereof (i.e., any air carrier in which any
directors, principal officers or persons having a substantial interest
have or once had a substantial interest), and any company (including a
sole proprietorship or partnership) which has a significant financial or
managerial influence on the applicant or air carrier. The latter includes:
(1) Any company (including a sole proprietorship or partnership) holding
more than 50 percent of the outstanding voting stock of the applicant or
air carrier; and
(2) Any company (including a sole proprietorship or partnership) holding
between 20 percent and 50 percent of the outstanding voting stock of the
applicant or air carrier and which has significant influence over the
applicant or air carrier as indicated, for example, by 25 percent
representation on the board of directors, participation in policy-making
processes, substantial inter-company transactions, or managerial personnel
with common responsibilities in both companies.
(l) Substantial change in operations, ownership, or management includes,
but is not limited to, the following events:
(1) Changes in operations from charter to scheduled service, cargo to
passenger service, short-haul to long-haul service, or (for a certificated
air carrier) small-aircraft to large-aircraft operations;
(2) The filing of a petition for reorganization or a plan of
reorganization under Chapter 11 of the federal bankruptcy laws;
(3) The acquisition by a new shareholder or the accumulation by an
existing shareholder of beneficial control of 10 percent or more of the
outstanding voting stock in the corporation; and
(4) A change in the president, chief executive officer or chief operating
officer, and/or a change in at least half of the other key personnel
within any 12-month period or since its latest fitness review, whichever
is the more recent period.
(m) Substantial interest means beneficial control of 10 percent or more of
the outstanding voting stock.
[Docket No. 47582, 57 FR 38766, Aug. 27, 1992, as amended at 60 FR 43523,
Aug. 22, 1995; 64 FR 12085, Mar. 11, 1999; 72 FR 20036, Apr. 23, 2007]
Subpart BFiling Requirements
top
204.3 Applicants for new certificate or commuter air carrier
authority.
top
An applicant for a type of certificate authority it does not currently
hold or for commuter air carrier authority shall file the data set forth
in paragraphs (a) through (v) of this section. In addition, the Department
may require an applicant to provide additional data if necessary to reach
an informed judgment about its fitness. If the applicant has previously
formally filed any of the required data with the Department or with
another Federal agency and they are available to the Department, and those
data continue to reflect the current state of the carrier's fitness, the
applicant may instead identify the data and provide a citation for the
date(s) and place(s) of filing. Prior to filing any data, the applicant
may contact the Air Carrier Fitness Division to ascertain what data
required by this section are already available to the Department and need
not be included in the filing.
Note: If the applicant intends to use as evidence data it has previously
filed pursuant to part 241 reporting requirements and those data contain
errors, the applicant must first file corrected reports in accordance with
241.22(g).
(a) The name, address, and telephone number of the applicant.
(b) The form of the applicant's organization.
(c) The State law(s) under which the applicant is organized.
(d) If the applicant is a corporation, a statement provided by the Office
of the Secretary of State, or other agent of the State in which the
applicant is incorporated, certifying that the applicant corporation is in
good standing.
(e) A sworn affidavit stating that the applicant is a citizen of the
United States.
(f) The identity of the key personnel who would be employed by the
applicant, including:
(1) Their names and addresses;
(2) The experience, expertise, and responsibilities of each;
(3) The number of shares of the applicant's voting stock held by each and
the percentage of the total number of such shares issued and outstanding,
and the citizenship and principal business of any person for whose
account, if other than the holder, such interest is held;
(4) The citizenship of each; and
(5) A description of the officerships, directorships, shares of stock (if
10 percent or more of total voting stock outstanding), and other interests
each holds or has held in any air carrier, foreign air carrier, common
carrier, person substantially engaged in the business of aeronautics or
persons whose principal business (in purpose or fact) is the holding of
stock in or control of any air carrier, common carrier or person
substantially engaged in the business of aeronautics.
(g) A list of all persons having a substantial interest in the applicant.
Such list shall include:
(1) Each person's name, address and citizenship;
(2) The number of shares of the applicant's voting stock held by each such
person and the corresponding percentage of the total number of such shares
issued and outstanding, and the citizenship and principal business of any
person for whose account, if other than the holder, such interest is held;
(3) If any two or more persons holding a substantial interest in the
applicant are related by blood or marriage, such relationship(s) shall be
included in the list; and
(4) If any person or subsidiary of a person having a substantial interest
in the applicant is or has ever been
(i) An air carrier, a foreign air carrier, a common carrier, or
(ii) Substantially engaged in the business of aeronautics, or
(iii) An officer or director of any such entity, or
(iv) A holder of 10 percent or more of total outstanding voting stock of
any such entity, the list shall describe such relationship(s).
(h) A list of the applicant's subsidiaries, if any, including a
description of each subsidiary's principal business and relationship to
the applicant.
(i) A list of the applicant's shares of stock in, or control of, any air
carrier, foreign air carrier, common carrier, or person substantially
engaged in the business of aeronautics.
(j) To the extent any relevant corporation has been engaged in any
business prior to the filing of the application, each applicant shall
provide:
(1) Copies of the 10K Annual Reports filed in the past 3 years by any
relevant corporation required to file such reports with the Securities and
Exchange Commission, and
(2) Copies of recently filed 10Q Quarterly Reports, as necessary, in order
to show the financial condition and results of operations of the
enterprise current to within 3 months of the date of the filing of the
application.
(k) If 10K Reports are not filed with the Securities and Exchange
Commission, the following, for the 3 most recent calendar or fiscal years,
reflecting the financial condition and results of operations of the
enterprise current to within 3 months of the date of the filing of the
application:
(1) The Balance Sheet of each relevant corporation;
(2) The Income Statement of each relevant corporation;
(3) All footnotes applicable to the financial statements, including:
(i) A statement as to whether the documents were prepared in accordance
with Generally Accepted Accounting Principles, and
(ii) A description of the significant accounting policies of each relevant
corporation, such as for depreciation, amortization of intangibles,
overhauls, unearned revenues, and cost capitalization;
(4) A statement of significant events occurring subsequent to the most
recent Balance Sheet date for each relevant corporation; and
(5) A statement identifying the person who has prepared the financial
statements, his or her accounting qualifications, and any affiliation he
or she has with the applicant.
(l) A list of all actions and outstanding judgments for more than $5,000
against any relevant corporation, key personnel employed (or to be
employed) by any relevant corporation, or person having a substantial
interest in any relevant corporation, including the amount of each
judgment, the party to whom it is payable, and how long it has been
outstanding.
(m) The number of actions and outstanding judgments of less than $5,000
against each relevant corporation, key personnel employed (or to be
employed) by any relevant corporation, or person having a substantial
interest in any relevant corporation, and the total amount owed by each on
such judgments.
(n) A description of the applicant's fleet of aircraft, including:
(1) The number of each type of aircraft owned, leased and to be purchased
or leased;
(2) Applicant's plans, including financing plans, for the purchase or
lease of additional aircraft; and
(3) A sworn affidavit stating that each aircraft owned or leased has been
certified by the FAA and currently complies with all FAA safety standards.
(o) A description of the current status of all pending investigations,
enforcement actions, and formal complaints filed by the Department,
including the FAA, involving the applicant or any relevant corporation,
any personnel employed (or to be employed) by any relevant corporation or
person having a substantial interest in any relevant corporation,
regarding compliance with the Statute or orders, rules, regulations, or
requirements issued pursuant to the Statute, and any corrective actions
taken. (If an applicant has a compliance history that warrants it,
additional information may be required.)
(p) A description of all charges of unfair or deceptive or anticompetitive
business practices, or of fraud, felony or antitrust violation, brought
against any relevant corporation or person having a substantial interest
in any relevant corporation, or member of the key personnel employed (or
to be employed) by any relevant corporation in the past 10 years. Such
descriptions shall include the disposition or current status of each such
proceeding.
(q) A description of any aircraft accidents or incidents (as defined in
the National Transportation Safety Board Regulations, 49 CFR 830.2)
experienced by the applicant, its personnel, or any relevant corporation,
which occurred either during the year preceding the date of application or
at any time in the past and which remain under investigation by the FAA,
the NTSB, or by the company itself, including:
(1) The date of the occurrence;
(2) The type of flight;
(3) The number of passengers and crew on board and an enumeration of any
injuries or fatalities;
(4) A description of any damage to the aircraft;
(5) The FAA and NTSB file numbers and the status of the investigations,
including any enforcement actions initiated against the carrier or any of
its personnel; and
(6) Positive actions taken to prevent recurrence. (If an applicant's
history of accidents or incidents warrants it, additional information may
be required.)
(r) A brief narrative history of the applicant.
(s) A description of all Federal, State and foreign authority under which
the applicant has conducted or is conducting transportation operations,
and the identify of the local FAA office and personnel responsible for
processing an application for any additional FAA authority needed to
conduct the proposed operations.
(t) A description of the service to be operated if the application is
granted, including:
(1) A forecast Balance Sheet for the first normal year ending after the
initially proposed operations have been incorporated, along with the
assumptions underlying the accounts and amounts shown; and
(2) A forecast Income Statement, broken down by quarters, for the first
year ending after the initially proposed operations are normalized, and an
itemization of all pre-operating and start-up costs associated with the
initiation of the proposed service. Such Income Statement shall include
estimated revenue block hours (or airborne hours, for charter operators)
and revenue miles by type of aircraft, number of passengers and number of
tons of mail and cargo to be carried, transport revenues and an estimate
of the traffic which would be generated in each market receiving the
proposed service. Such statements shall also include a statement as to
whether the statements were prepared on the accrual or cash basis, an
explanation of how the estimated costs and revenues were developed, a
description of the manner in which costs and revenues are allocated, how
the underlying traffic forecasts were made, and what load factor has been
assumed for the average and peak month. Pre-operating and start-up costs
should include, but are not limited to, the following: Obtaining necessary
government approval; establishing stations; introductory advertising;
aircraft, equipment and space facility deposits and rent; training; and
salaries earned prior to start-up.
(u) A signed counterpart of Agreement 18900 (OST Form 4523) as required by
part 203 of this chapter.
(v) The following certification, which shall accompany the application and
all subsequent written submissions filed by the applicant in connection
with its application:
Pursuant to title 18 United States Code section 1001, I [the individual
signing the application, who shall be a principal owner, senior officer,
or internal counsel of the applicant], in my individual capacity and as
the authorized representative of the applicant, have not in any manner
knowingly and willfully falsified, concealed or covered up any material
fact or made any false, fictitious, or fraudulent statement or knowingly
used any documents which contain such statements in connection with the
preparation, filing or prosecution of the application. I understand that
an individual who is found to have violated the provisions of 18 U.S.C.
section 1001 shall be fined nor more than $10,000 or imprisoned not more
than five years, or both.
(The reporting requirements contained in this section were approved by the
Office of Management and Budget under control number 21060023)
[Docket No. 47582, 57 FR 38766, Aug. 27, 1992, as amended at 60 FR 43524,
Aug. 22, 1995]
204.4 Carriers proposing to provide essential air service.
top
Applicants proposing to provide essential air service have been divided
into two categories, and are subject to differing data submission
requirements as set forth in paragraphs (a) and (b) of this section.
However, if a carrier has previously filed any of the required data with
the Department or other Federal agency and they are available to the
Department, and these data continue to reflect the current state of the
carrier's fitness, the carrier may instead identify the data and provide a
citation for the date and place of filing. All carriers may contact the
Air Carrier Fitness Division to ascertain what information is already
available to the Department and thus may not need to be resubmitted.
(a) Carriers who propose to begin or expand non-subsidized essential air
service when the incumbent leaves the market must file the following
information:
(1) All of the information required under 204.3 of this part.
(2) A description of the back-up aircraft available to the applicant,
including:
(i) The number of each type of such aircraft;
(ii) The conditions under which such aircraft will be available to the
carrier;
(iii) The carrier's plans for financing the acquisition or lease of such
additional aircraft; and
(iv) A sworn affidavit stating that all such aircraft have been certified
by the FAA and currently comply with all FAA safety standards.
(3) A description of the fuel available to perform the proposed essential
air services and the carrier's contracts with fuel suppliers.
(4) The carrier's systemwide on-time and completion record for the
preceding year and, if applicable, in the subject market(s).
(5) A list of the markets the carrier serves and the number of weekly
round trips it provides in each.
(6) A description of the average number of block hours each type of
aircraft is currently flown per day.
(7) An estimate of the impact the proposed essential air service would
have on the carrier's utilization of its aircraft fleet.
(8) A detailed schedule of the service to be provided, including times of
arrivals and departures, the aircraft to be used for each flight, and the
fares to be charged.
(9) A pro-forma income statement for the proposed operation for the first
annual period.
(b) Carriers filing proposals to provide subsidized service in response to
an order inviting proposals shall file:
(1) All of the information required under 204.3 of this part.
(2) All of the information required under paragraph (a) of this section.
(3) A forecast Income Statement covering the operations conducted in
essential air service for the first year following the initiation of the
proposed essential services. Such statement shall include:
(i) Subsidy needed;
(ii) Estimated block hours and revenue miles by type of aircraft;
(iii) Total projected revenue including volumes of passengers and freight
by essential air service market and the associated fares and rates;
(iv) An explanation of the derivation of estimates of operating expenses;
and
(v) A description of the manner in which costs and revenues are allocated.
(4) A traffic forecast including a load factor analysis on all segments
between the small community and the hub; and an estimate of the number of
seats available to and from the eligible point each day.
(Approved by the Office of Management and Budget under control number
21060023)
[Docket No. 47582, 57 FR 38766, Aug. 27, 1992, as amended at 60 FR 43524,
Aug. 22, 1995]
204.5 Certificated and commuter air carriers undergoing or proposing
to undergo substantial change in operations, ownership, or management.
top
(a) A certificated or commuter air carrier proposing a substantial change
in operations, ownership or management shall file the data set forth in
204.3. These data must be submitted in cases where:
(1) The proposed change requires new or amended authority, or
(2) The change substantially alters the factors upon which its latest
fitness finding is based, even if no new authority is required.
(b) Information which a carrier has previously formally filed with the
Department, or with another Federal agency where they are available to the
Department, which continues to reflect the current state of the carrier's
fitness may be omitted. The carrier instead should identify the data and
provide a citation for the date(s) and place(s) of filing. Prior to filing
any data, the carrier may contact the Department (Air Carrier Fitness
Division) to ascertain what data required by this section, if any, are
already available to the Department or are not applicable to the
substantial change in question and need not be included in the filing.
(c) Information filings pursuant to this section made to support an
application for new or amended certificate authority shall be filed with
the application and addressed to Docket Operations, M30, U.S. Department
of Transportation, Washington, DC 20590, or by electronic submission at
http://dms.dot.gov .
(d) Information filed in support of a certificated or commuter air
carrier's continuing fitness to operate under its existing authority in
light of substantial changes in its operations, management, or ownership,
including changes that may affect the air carrier's citizenship, shall be
addressed to the Chief, Air Carrier Fitness Division, Office of the
Secretary, U.S. Department of Transportation, Washington, DC 20590.
(Approved by the Office of Management and Budget under control number
21060023)
[Docket No. 47582, 57 FR 38766, Aug. 27, 1992, as amended at 72 FR 20036,
Apr. 23, 2007]
204.6 Certificated and commuter air carriers proposing a change in
operations, ownership, or management which is not substantial.
top
Carriers proposing to make a change which would not substantially affect
their operations, management, or ownership, such as certificated carriers
applying for additional authority which would not substantially change
their operations, will be presumed to be fit and need not file any
information relating to their fitness at time of the change. However, if
the Department concludes, from its own analysis or based on information
submitted by third parties, that such change may bring the carrier's
fitness into question, the Department may require the applicant carrier to
file additional information.
204.7 Revocation for dormancy.
top
(a) An air carrier that has not commenced any type of air transportation
operations for which it was found fit, willing, and able within one year
of the date of that finding, or an air carrier that, for any period of one
year after the date of such a finding, has not provided any type of air
transportation for which that kind of finding is required, is deemed no
longer to continue to be fit to provide the air transportation for which
it was found fit and, accordingly, its authority to provide such air
transportation shall be revoked.
(b) An air carrier found fit which commences operations within one year
after being found fit but then ceases operations, shall not resume
operations without first filing all of the data required by 204.3 at
least 45 days before it intends to provide any such air transportation.
Such filings shall be addressed to the Documentary Services Division,
Department of Transportation, 1200 New Jersey Avenue, SE., Washington, DC
20590. The Department will entertain requests for exemption from this
45-day advance filing requirement for good cause shown. If there has been
no change in fitness data previously formally filed with the Department,
the carrier shall file a sworn statement to that effect signed by one of
its officers. The carrier may contact the Department (Air Carrier Fitness
Division) to ascertain which data are already available to the Department
and need not be refiled. A carrier to which this paragraph applies shall
not provide any air transportation for which it is required to be found
fit, willing, and able until the Department decides that the carrier
continues to be fit, willing, and able to perform such air transportation.
During the pendency of the Department's consideration of a data submission
under this paragraph, the expiration period set out in paragraph (a) of
this section shall be stayed. If the decision or finding by the Department
on the issue of the carrier's fitness is favorable, the date or that
decision or finding shall be the date considered in applying paragraph (a)
of this section.
(c) For purposes of this section, the date of a Department decision or
finding shall be the service date of the Department's order containing
such decision or finding, or, in cases where the Department's decision or
finding is made by letter, the date of such letter.
(d) For purposes of this section, references to operations and to the
providing of air transportation shall refer only to the actual performance
of flight operations under an operating certificate issued to the carrier
by the FAA.
(Approved by the Office of Management and Budget under control number
21060023)
| File Type | text/plain |
| File Modified | 0000-00-00 |
| File Created | 0000-00-00 |