[Federal Register Volume 60, Number 140 (Friday, July 21, 1995)]
[Notices]
[Pages 37701-37703]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-17827]
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DEPARTMENT OF TRANSPORTATION
Office of the Secretary
Order Approving and Granting Antitrust Immunity
SUMMARY: This document approves and grants antitrust immunity to the
agreement in Docket 48831 and those portions of the agreement in Docket
49596 as set forth in the order. The order is published as an appendix
to this document.
DATES: The order was issued in Washington, DC, July 13, 1995 and the
order became effective on July 13, 1995.
FOR FURTHER INFORMATION CONTACT: Lawrence Myers, U.S. Department of
Transportation, Office of the Assistant General Counsel for
International Law, room 10105, 400 Seventh Street, SW., Washington, DC
(202) 366-9183.
Patrick V. Murphy,
Acting Assistant Secretary for Aviation and International Affairs.
[Order 95-7-19; Docket 48831 Resolution 600b Docket 49596 R-1, R-8]
Agreements adopted by the Cargo Services Conferences of the
International Air Transport Association relating to conditions of
contract.
Order
Various members of the International Air Transport Association
(IATA) have filed two agreements with the Department for approval
and antitrust immunity under sections 41309 and 41308 of Title 49,
United States Code, and Part 303 of the Department's regulations.
They were adopted at the annual meetings of the Cargo Services
Conferences in 1993 and 1994 for amended intended effectiveness on
October 1, 1994.\1\
\1\ IATA memoranda CSC/Reso/062, Docket 48831; and CSC/Reso/063,
Docket 49596.
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In 1989, IATA adopted Resolution 600b, which was a new,
abbreviated version of the standard Air Waybill Conditions of
Contract contained in Resolution 600b(II), which it was intended to
replace. Portions of Resolution 600b were disapproved by the
Department in Order 89-10-52 and the decision confirmed on
reconsideration in Order 91-10-21. As a result, the airlines
continued to use Resolution 600b(II). In 1993, IATA amended
Resolution 600b, taking into account the Department's expressed
concerns, and submitted the amended version for approval in Docket
48831 with an intended effective date of October 1, 1995. In 1994,
IATA further amended Resolution 600b, taking into account certain
U.S. court decisions interpreting provisions of the
[[Page 37702]]
Warsaw convention as applied to the contents of a cargo waybill. The
latter amendments to Resolution 600b were submitted to the
Department as R-1 in Docket 49596, with a revised intended effective
date of October 1, 1994, for the resolutions in both dockets.\2\
\2\ A French version of the amended Resolution 600b (R-1) was
submitted as Recommended Practice 16006 (R-8) in the same docket,
along with various other cargo resolutions. Orders 95-2-3 and 95-3-
12 approved all these resolutions except R-1 and R-8. In addition,
an expedited agreement amending resolutions 600AA, 600AB, 600B(II)
and 670A was filed in Docket 49595 and was approved by Order 94-7-
17.
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We will approve the text of Resolution 600b as submitted in
Docket 48831, CSC(15)600b. As IATA noted in its justification in
that docket, Order 89-10-52 approved the language of paragraph 7.1.1
only upon the understanding that the words ``immediately after
discovery of the damage'' do not constitute a time limit for filing
claims independent of the specified 14-day period from the date of
receipt of the cargo. IATA assures us that the words are ``intended
to encourage prompt reporting'' without constituting a separate
requirement. We will therefore approve IATA's language, subject to a
condition implementing this understanding.
However, with respect to the additional amendments to Resolution
600b submitted in Docket 49596, CSC(16)600b, we have two substantial
difficulties. First, IATA has proposed a new paragraph 4.2 which
states that in carriage to which the Warsaw Convention does not
apply, a carrier ``may'' permit a shipper to increase its cargo
liability limitation by declaring a higher shipment value and paying
a supplemental charge if so required. The cargo liability limitation
for this non-Warsaw carriage is the same as that set forth in
paragraph 3 for Warsaw carriage: 17 Special Drawing Rights (as
defined by the International Monetary Fund) per kilogram of cargo
lost, damaged or delayed. Paragraph 4.2 is intended, in IATA's
words, to provide the same ``option'' to shippers that is provided
by paragraph 4.1 for Warsaw carriage. However, paragraph 4.2 is
clearly permissive, while the language in paragraph 4.1 indicates
that the shipper's right to declare a higher value under the
Convention is absolute for cargo accepted for carriage. We have not
objected to the extension of the Warsaw cargo liability limit to
non-Warsaw carriage, but are firmly of the view that, in return, the
complementary right of the shipper to declare excess value should be
no less assured in the case of non-Warsaw carriage. We will
therefore defer action on paragraph 3 of Resolution 600b until IATA
changes the word ``may'' to ``shall'' in paragraph 4.2, or adopts
other acceptable language that assures the shipper of the same right
to declare excess value in non-Warsaw situations.
Our second problem with the latest amendments to Resolution 600b
is the addition of language to the Notice on the face of the air
waybill and similar language to paragraph 7 on the back which may be
interpreted by carriers, shippers and the courts as expanding the
applicability of the Warsaw Convention to carriage not heretofore
considered covered by its provisions, and which could cause great
uncertainty over its application.\3\
\3\ The words ``shipper agrees that the shipment may be carried
via intermediate stopping places which the carrier deems
appropriate'' would be added to the Notice on the face of the
waybill, and the underlined words ``Carrier is authorized by the
shipper to select the routing and all intermediate stopping places
that its deems appropriate or to change or deviate from the routing
shown on the face hereof'' would be added to the last sentence of
paragraph 7.
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IATA indicated in its justification that the proposed language
was prompted by ``recent court decisions'' interpreting Articles 8
and 9 of the Warsaw Convention.\4\ Article 8 of the Convention
requires, inter alia, that the air waybill shall contain various
particulars, including ``the agreed stopping places.'' Article 9 of
the Convention provides that if the waybill does not contain these
and other particulars, the carrier shall not be entitled to avail
itself of the provisions of the Convention which exclude or limit
its liability. Apparently, IATA is concerned that courts may deny
the carriers the Warsaw limits on their liability unless they list
all intermediate points that might be used for any type of stop or
else incorporate language such as that proposed which arguably makes
any stop selected by the carrier one agreed to by the shipper.
\4\ IATA provided no further explanation of its position, but,
upon request, provided the Department with a reference to one case,
Maritime Ins. Co. LTD. v. Emery Air Freight Corp., 983 F.2d 437 (2nd
Cir. 1993).
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If this is indeed IATA's position, we do not share its premise
or agree with its interpretation of the proposed language. In the
context of cargo service, whose hallmark is routing flexibility
which benefits shippers as well as carriers, the language proposed
by IATA is not objectionable from an operational standpoint, and we
therefore approved it on that basis by Order 94-7-17 in the context
of amendments to Resolution 600b(II). In this sense, the language is
merely an elaboration of the right of the carrier under the waybill
to determine the routing of the shipment.
However, it is neither necessary nor appropriate to construe the
proposed language as broadening the meaning of ``agreed stopping
place,'' as that term is used in the Warsaw Convention, where it
appears not only in Article 8 but also in Article 1. Article 1
confines the applicability of the Convention itself to carriage
between at least two contracting parties or within one contracting
party if there is an ``agreed stopping place'' in another
jurisdiction, whether or not it is a contracting party.
One of the primary goals of the Convention was legal
predictability, and that goal would be undermined if ``agreed
stopping place'' in Article 1 had been intended to encompass all
possible routings rather than just those expressly agreed to by the
shipper and entered on the waybill. Such an interpretation would
mean that the determination of many important contractual rights of
both carriers and shippers would depend on operational vagaries
which may not reflect assent by either party for jurisdictional
purposes and, indeed, which may engender wasteful litigation over
the facts of individual routings which deviate from points specified
on the waybill.
We will approve IATA's language as proposed in CSC(16)600b, but
only upon the condition that its reference to intermediate points
does not constitute an ``agreed stopping place'' for purposes of
jurisdiction under Article 1(2) of the ``Warsaw Convention.'' We
similarly clarify that our approval in Order 94-7-17 of amended
paragraphs 8./8.1 and 8.2 of Resolution 600b(II), submitted in
Docket 49595, is based on the same understanding.\5\
\5\ We understand that IATA intends for Resolution 600b to
replace Resolution 600b(II), but wish to make clear the scope of our
approval of the latter provisions to avoid the possibility of legal
confusion until Resolution 600b comes into effect.
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Acting under Title 49 of the United States Code, as amended,
(``the Code'') and particularly sections 40101, 4013(a), 41308 and
41309:
1. We do not find Resolution 600b, set forth in the agreement in
Docket 48831, to be adverse to the public interest or in violation
of the Code, subject to the condition that the phrase ``immediately
after discovery of the damage'' in paragraph 8.1.1 of Resolution
600b does not constitute a time limit for filing claims independent
of the 14-day period specified elsewhere in that paragraph;
2. Except as provided in finding paragraph 3 below, we do not
find R-1 and R-8 of the agreement in Docket 49596, to be adverse to
the public interest or in violation of the Code, subject to the
condition that the reference to intermediate stopping places in
paragraph 2 of Resolution 600b does not constitute an ``agreed
stopping place'' for purposes of jurisdiction under Article 1(2) of
the Warsaw Convention;
3. We find paragraph 4.2 of Resolution 600b, set forth in R-1 of
the agreement in Docket 49596, to be adverse to the public interest
and in violation of the Code; and
4. These agreements are a product of the IATA tariff conference
machinery, which the Department found to be anticompetitive but
nevertheless approved on foreign policy and comity grounds by Order
85-5-32, May 6, 1985. The Department found that important
transportation needs were not obtainable by reasonably available
alternative means having materially less anticompetitive effects.
Antitrust immunity was automatically conferred upon these
conferences because, where an anticompetitive agreement is approved
in order to attain other objectives, the conferral of antitrust
immunity is mandatory under title 49 of the United States Code, as
amended.
Order 85-5-32 contemplates that the products of fare, rate and
services conferences will be subject to individual scrutiny and will
be approved provided they are of a kind specifically sanctioned by
Order 85-5-32 and are not adverse to the public interest or in
violation of the Code. As with the underlying IATA conference
machinery, upon approval of a conference agreement, immunity for
that agreement must be conferred under the Act. Consequently, we
will grant antitrust immunity to the agreements set forth in finding
paragraphs 1
[[Page 37703]]
and 2 above, subject to the conditions imposed therein.
Accordingly,
1. We approve and grant antitrust immunity to the agreement in
Docket 48831 and to those portions of the agreement in Docket 49596,
set forth in finding paragraphs 1 and 2 above, subject to the
conditions imposed therein;
2. We disapprove that portion of the agreement in Docket 49596
set forth in finding paragraph 3, above; and
3. We attach the following condition to our approval in Order
94-7-17 of the amendments to paragraphs 8/8.1 and 8.2 of Resolution
600b (II) in Docket 49595: The references to intermediate stopping
places in paragraphs 8/8.1 and 8.2 of Resolution 600b (II) do not
constitute an ``agreed stopping place'' for purposes of jurisdiction
under Article 1(2) of the Warsaw Convention;
4. We defer action on paragraph 3 of Resolution 600b, set forth
in R-1 of the agreement in Docket 49596, until such time as IATA
amends paragraph 4.2 of the same resolution to assure shippers of
the same right to declare excess value when the Warsaw Convention is
not applicable as when it is applicable; and
5. We will publish this order in the Federal Register.
By:
Patrick V. Murphy,
Acting Assistant Secretary for Aviation and International Affairs.
[FR Doc. 95-17827 Filed 7-20-95; 8:45 am]
BILLING CODE 4910-62-P
