No C 320/4 Official Journal of the European Communities 20. 12. 90
Notice pursuant to Article 19 (3) of Regulation No 17 (') concerning Case IV/32 792 — IATA cargo agency programme (90/C 320/04)
I II
NOTIFICATIONS THE PARTIES: IATA AND ITS MEMBERSHIP
1. On 7 July 1988 the Director General on behalf of IATA and on behalf of its member airlines participating 4. IATA is an association of enterprises composed of in the IATA Cargo Agency Conference (CACONF) (2) 189 member air carriers. It was founded at the Inter applied for negative clearance of the IATA Cargo national Air Transport Operators Conference at Havana, Agency Programme as applicable within the EEC, and, Cuba, in April 1945. to the extent that such negative clearance could not be granted, for an exemption under Article 85 (3) of the Treaty establishing the European Economic Community. 5. Members of IATA are classified as active or associate. Any air transport enterprise operating an air The core of this application consisted of IATA resolution service between the territories of two or more States is 801 series, namely: eligible for membership as an active member.
— Resolution 801 — cargo agency administration rules, 6. The parties are the 154 active member airlines participating in the IATA Cargo Agency Conference — Resolution 801a — cargo agency agreement. (CACONF). Thirty-five IATA associate member airlines (3) do not offer international scheduled services nor participate in the CACONF. The arrangements, 2. Subsequent to this application the IATA CACONF however, affect them because they comply with them. adopted a new resolution 803 series replacing resolution 801 and introducing material changes to IATA's arrangements concerning cargo agencies. The new resol utions were notified on 2 October 1989. According to IATA they were developed with a view to the changing Ill regulatory environment and took into account, inter alia, the Commission's concerns regarding cargo agents. THE MARKET
3. By letter of 17 April 1990 IATA further notified resolution 805 series substituting resolution 803 as the 7. According to IATA the global operating revenues basic applicable regime in the European Community. for scheduled internatonal cargo services of all IATA Three resolutions were then filed: member airlines in 1989 were approximately US $ 12 500 million, out of total revenues for all services (passenger, cargo, mail and other) of about US $ 70 700 million. — Resolution 805 — IATA cargo agency distribution The individual members' total turnovers (passenger, cargo, mail and other) range from US $ 1,5 million to system rules — Europe, US $ 9 960 million.
— Resolution 805d — agency commissioner, According to the Association of European Airlines — Resolution 805e — conduct of review by agency (AEA) Yearbook Statistical Appendices for 1988, the 4 commissioner. total revenues of AEA airlines based in the EEC ( ) coming from international cargo traffic amounted to These resolutions contain a number of changes in US $ 4 899 million. comparison to the provisions of the earlier resolutions. Many of these changes were introduced following the Commission's intervention.
(3) See Annex. (4) EEC carriers in AEA comprise Aer Lingus, Air France, (') OJ No 13, 21. 2. 1962, p. 204/62. Alitalia, British Airways, Iberia, KLM, Lufthansa, Luxair, (2) IATA active members, listed in Annex. Olympic, Sabena, SAS, TAP and UTA. 20. 12. 90 Official Journal of the European Communities No C 320/5
8. All IATA member airlines use the Agency scale and the benefits of standardization and auto Programme for their sales. IATA accredited cargo agents mation in the collection and distribution of monies — which number approximately 1 000 in the EEC, of a due from IATA agents to airlines; total of some 3 000 IATA agents registered worldwide — are in the majority independent businesses. (It is estimated that in the EEC there are approximately 300 to (c) vocational training programmes, helping interme 400 professional intermediaries handling international diaries, both IATA agents and others which may cargo not registered as IATA cargo agents.) However, seek IATA accreditation, to achieve and maintain in they may sometimes be part of a group of companies. In a cost-effective manner the standards required to a few instances, they are controlled by transport enter help the customer to make his choice of the airline prises such as railways and shipping lines and even by services offered; this is particularly important in member airlines of IATA. developing competence in handling of dangerous goods, to ensure safety of passengers, of crew and of aircraft on which these shipments are loaded. 9. Sales take the form of a contract for carriage (air waybill) issued by the airline or, within the terms of the arrangements, by the airline's appointed agent on the 12. The management of the programme is assigned to airline's behalf. The airlines have their own sales outlets the agency administration division, within the IATA in their biggest markets, but make, according to secretariat. estimates, approximately 70 % of their sales in Europe through IATA cargo agents, the remainder being handled through airlines' own sales offices, or through their general sales agents. The IATA resolutions under examination (')
IV Qualifications for accreditation and retention as an IA TA cargo agent THE IATA CARGO AGENCY PROGRAMME
13. Any person in possession of the appropriate official licences, where required, may become an IATA General cargo agent by making an application in the form prescribed to the IATA agency administrator in the country where such person carries on business, and by meeting the qualifications set out below. Such qualifi 10. The cargo agency programme, which has been cations must continue to be met in order to ensure established by the CACONF and is the IATA's system retention as an IATA cargo agent. For this purpose the for appointing intermediaries in the field of cargo term 'applicant' should be understood to include an carriage, is one of its basic institutions. It is argued that aiready accredited agent. the main objective of the programme is to ensure that cargo agency outlets selling on behalf of IATA Members are professional, provide safe handling of dangerous goods, provide dependable service to shippers and 14. The applicant must submit independently appointing airlines, and handle shippers' goods and produced financial statements prepared in accordance airlines' monies with integrity. with local accounting practices as specified and published by the IATA body entrusted with accreditation; such statements are evaluated pursuant to the methodology and standards established from time to time by the same 11. The programme incorporates three main features: body. To obtain a satisfactory evaluation, the applicant may be required to provide additional financial support in the form of recapitalization or of a bank or insurance guarantee. When the financial position of an agent is (a) accreditation, whereby any person may seek reviewed, if the agent is unable to meet the financial approval to promote, sell and process international criteria, normal business fluctuations are taken into air cargo transportation for remuneration by IATA account, and the agent will be provided with a member airlines, by satisfying specified basic criteria reasonable period of time to meet those criteria. and entering into contractual relations with those airlines;
(b) cargo accounts settlement systems (CASS), which (') Unless otherwise specified the provisions above are provide to both airlines and agents economies of contained in resolution 805. No C 320/6 Official Journal of the European Communities 20. 12. 90
15. The applicant is required to employ at all places (c) delivering (or arranging for delivery of) where it makes air cargo ready for carriage full-time consignments to an airline at any airport designated staff competent and qualified to provide the services and by the airline for general acceptance of all handling functions set by LATA. The applicant must consignments ready for carriage; supply evidence that:
(d) accepting restricted articles for carriage and delivery (or arranging for delivery) to an airline in (a) two such persons hold an adequate basic diploma accordance with the applicable dangerous goods having completed an acceptable course; regulations;
(e) collecting charges from customers, and remitting (b) two such persons, at the time of application and at monies due to carriers. all times subsequent to registration:
18. Where officially required, the applicant must be in (i) hold an LATA advanced diploma including possession of a valid licence to trade. Suspension or training in handling of dangerous goods, withdrawal of this licence constitute grounds to initiate a obtained within the previous two years; or review of the agent.
(ii) have completed, within the previous two years, 19. The applicant must not have a name which is: an equivalent dangerous goods course of training given by an LATA member, or another (a) the same as, or misleadingly similar to that of an training course in handling dangerous goods IATA member or IATA; or recognized by LATA offered by another entity;
(b) the same as that of another IATA cargo agent in the same country; this prohibition does not apply to where the applicant's staff at such places is limited to persons entered on the cargo agency list prior to 1 two such persons, both must meet the requirements set April 1984. forth in (a) and (b).
The place of business must not be identified as an office of an IATA member. 16. The applicant must, in the country concerned:
20. The applicant, its managerial staff, its principal (a) maintain and operate at least one office (or a stockholders (and persons for whom they act as department of such an office) engaged in the nominees), directors, officers and managers must not promotion or sale of international air cargo trans have been found guilty of wilful violations of fiduciary portation over the lines of IATA members, and the obligations incurred in the course of business, nor be handling of consignments therein; undischarged bankrupts.
(b) have adequate insurance to cover its liability for loss Procedures for accreditation of or damage to shippers' cargo. 21. The applicant is required to complete an application form and submit it to the IATA agency 17. The applicant must have premises, staff and administrator, accompanied by the necessary documents equipment for the performance of the following and financial statements and by fees, including functions as a minimum: application, entry and first annual agency fees. The agency administrator may ask the applicant to provide additional information. (a) quoting airlines' rates and charges and conditions pertaining to such rates and charges; 22. The administrator will publish a listing of the applications received in order that the IATA members may within 30 days file evidence and indicate the (b) assisting customers in completing the required grounds why, in their opinion, the applicant does not formalities for the transportation of cargo by air, meet the qualifications. In this case the applicant is including reservation services; informed and invited to respond. 20. 12. 90 Official Journal of the European Communities No C 320/7
23. A decision must be taken within 45 days of the Resolution 805 contains rules as to how to calculate date of publication of the listing. The applicant is to be commission, and rules related to interline sales, payment notified promptly in writing and, in the event of of commission to applicants, duties of agents in order to rejection, must be given clear reasons why the be paid commission (acceptance and delivery of goods, application failed. provision of air waybills and collection of payment), agents in country of destination, charter transportation, government transportation and refunds. There is no ban on splitting commissions to the benefit of the shipper. 24. A rejected applicant may, within 30 calendar days of the administrator's notice, request reconsideration of his decision, and then, if necessary invoke the procedures for review by the agency commissioner referred to in resolution 805d. (See paragraph 33 below.) Administrative rules
25. Successful applicants will be entered on the IATA cargo agency list and the IATA Director General will execute a cargo agency agreement with each person 30. Resolution 805 also contains technical and admin registered as an agent. The agency administrator must istrative rules on how to collect funds and remit promptly notify all airlines of the names of parties payments through the CASS or directly to airlines, rules executing cargo agency agreements and the dates of such on agents' irregularities and default, and rules on change agreements. The agency administratory is required to of ownership, legal status, name or address. maintain, publish and circulate from time to time, a cargo agency list of all persons with whom the Director General has entered into a cargo agency agreement.
Default procedures 26. An IATA member may appoint an agent which is on the cargo agency list:
31. If at any time after receipt of a declaration of (i) by depositing with the agency administrator a default from a member the agency administrator statement of general agreement for the appointment becomes aware that there exists between that member of all agents. IATA shall from time to time publish a and the agent a commcercial dispute in respect of the list of members having deposited such a statement of period for which the notice of irregularity was sent general agreement; and/or in respect of previous periods, the agency admin istrator is required to withhold or to withdraw, as the case may be, the declaration of default. If such ii) alternatively, a member may inform the agent, in declaration is withdrawn, the agency administrator must writing with copy to the agency administrator, that terminate actions against the agent and notify all the member specifically concurs in its appointment as members and, where applicable, the CASS management an agent. accordingly. Upon receipt of such notification, members must pay any commission withheld from the agent. The notice of irregularity giving rise to the withheld or withdrawn declaration of default must be removed by 27. Any member airline having appointed an agent the agency administrator. If a declaration of default was may cancel such appointment by so notifying the agent the result of an error and the declaring member so in writing with a copy to the agency administrator. notifies the agency administrator and submits details in writing, the agency administrator must withdraw the declaration of default and the procedures above also 28. The provision of air waybills shall be at the option apply in such a case. of the member. The member may, also at its option, authorize the agent to issue neutral air waybills on the member's behalf.
Measures affecting agents' standing Payment of Commission
29. Agents duly appointed by IATA members are paid 32. Agents may relinquish accreditation or may be commission for the sale and handling of international air removed by IATA for the reasons specified in Resolution cargo transportation, at such rate as may be authorized 805 (e.g. not meeting the qualifications for retention, from time to time by individual member airlines. because of default or irregularities, losing the licence to No C 320/8 Official Journal of the European Communities 20. 12. 90
trade in the countries where this is required, etc.). They jeopardy, has the right to obtain such member's criteria may also be suspended or reprimanded. The procedures for appointing agents or the reasons for the refusal or and the effects of the various situations are specified. withdrawal. If the agent believes such justification is unreasonable then the agent is required, in the first instance, to seek clarification and satisfaction from the Review of LATA agency administrator's decisions affecting member. If the issue is not thereby resolved, the agent applicants and agents, and review of agents' status has the right to have the member's decision reviewed by the agency commissioner. Where the member's decision 33. Decisions affecting applicants and agents, issued to withdraw its appointment, stock of air waybills or by the competent LATA bodies, may be reviewed at first authorization to issue neutral air waybills from the agent instance by an expressly appointed LATA commissioner, was made in application of the collective provisions of referred to in resolution 805d, who will also deal with resolution 805 the agent's right for review is not to be the review of the agents' status when some grievance exercised against the member individually but as set forth against him has been raised by the LATA agency admin in the particular provisions concerned and in resolution istrator. The decisions of the commissioner are, for their 805e. part, subject to review by arbitration. Procedures for review by the commissioner are contained in resolution 805e. Procedures for review by arbitration are contained Implementation in resolution 805. 35. Resolutions 805, 805d and 805e will be implemented in all EEC Member States by not later than Review of a member's individual decisions 1 July 1991.
34. Resolution 805 provides for the right of review of At the same time the regimes set forth by LATA resol LATA members' individual decisions affecting agents. utions series 801 and 803 will no longer apply within the Accordingly, an agent which considers itself aggrieved Community. by the decision of a member:
(a) to refuse to appoint such agent; or V (b) to withdraw its appointment of such agent; or THE COMMISSION'S INTENTIONS (c) to refuse to; 36. The Commission proposes to take a favourable (i) supply the agent with a stock of its air waybills; decision concerning the resolutions referred to in or paragraph 3 of this notice.
(ii) authorize the agent to issue neutral air waybills 37. Before taking this decision, the Commission on its behalf; or invites interested third parties to send their comments within one month from the publication of this notice to (d) to withdraw: the following address, quoting the reference IV/32 792 — LATA cargo agency programme. (i) its air waybill stock from the agent; or Commission of the European Communities (ii) its authorization to the agent to issue neutral air Directorate-General for Competition, waybills on its behalf; Directorate for Restrictive Practices, Abuse of Dominant Positions and other Distortions of Competition III, with the result that such agent's commercial interests are 200 rue de la Loi, adversely affected to the point of placing its business in B-1049 Brussels. 20. 12. 90 Official Journal of the European Communities No C 320/9
ANNEX
International Air Transport Association — Membership
189 members (154 active and 35 associate) on 15 February 1990
Active members Caribbean Air Cargo Company Ltd Ceskoslovenske Aerolinie (CSA) Adria Airways Compafiia Mexicana de Aviacion SA de CV (Mexicana) Aer Lingus pic Continental Airlines Inc Aeroflot Soviet Airlines Cook Islands International Airlines Ltd Aerolineas Argentinas Crossair Aerolineas Nicaraguenses SA (Aeronica) Cruzeiro do Sul SA-Servicos Aereos Aerovias de Mexico SA de CV (Aeromexico) Cyprus Airways Ltd Aerovias Nacionales de Colombia SA (Avianca) Dan-Air Services Ltd Affretair (PVT) Ltd Delta Air Regionalflugverkehr GmbH Air Afrique Democratic Yemen Airlines (Alyemda) Air Algerie Deutsche Lufthansa AG (Lufthansa) Air Botswana Eastern Air Lines Inc. Air Bremen GmbH & Co. Egyptair Air Bridge Carriers Ltd El Al Israel Airlines Ltd Air Canada Emirates Air Europe Ltd Empresa Consolidada Cubana de Aviaci6n (Cubana) Air France Empresa de Transporte Aereo del Peru (Aeroperu) Air Gabon Empresa Ecuatoriana de Aviacidn SA (Ecuatoriana) Air Guin6e Ethiopian Airlines Corporation Air Jamaica Ltd Federal Express Corporation Air Littoral Finnair Oy Air Madagascar Friendly Islands Airways Ltd Air Malawi Ltd Gambia Air Shuttle Ltd Air Malta Company Ltd Garuda Indonesia Air Martinique German Wings Luftfahrtunternehmen GmbH Air Mauritius Ghana Airways Corporation Air New Zealand Ltd Gulf Air Company GSC Air Niugini Hong Kong Dragon Airlines Ltd (Dragonair) Air Pacific Ltd Iberia (Lineas Aereas de Espafia SA) Air Seychelles Ltd Icelandair Air Tanzania Corporation Indian Airlines Air Tungaru Corporation Iran Air, The Airline of the Islamic Republic of Iran Air UK Iraqi Airways Air Zaire Jamahiriya Libyan Arab Airlines Air Zimbabwe Corporation Japan Airlines Co. Ltd Air-India Japan Air System Co. Ltd Airline of the Marshall Islands Jugoslovenski Aerotransport (JAT) Alaska Airlines Inc. Kenya Airways Ltd Alisarda SpA KLM Royal Dutch Airlines Alitalia — Linee Aeree Italiane SpA Korean Air All Nippon Airways Co., Ltd Kuwait Airways Corporation American Airlines Inc. LAM — Linhas Aereas de Mozambique America West Airlines, Inc. Lauda Air Luftfahrt AG Ariana Afghan Airlines Co. Ltd Lesotho Airways Corporation Austrian Airlines Linea Aerea del Cobre SA (Ladeco) Balkan Bulgarian Airlines Linea Aerea Nacional-Chile SA (LAN-Chile) Berlin European UK Ltd Lineas Aereas Costarricenses SA (Lacsa) Birmingham European Airways pic Lineas Aereas Paraguayas — LAP Braathens SAFE Lloyd Aereo Boliviano SA (LAB) British Airways pic Loganair Ltd British Midland Airways Ltd London City Airways Brymon Airways Malev — Hungarian Airlines Cameroon Airlines Manx Airlines Ltd Canadian Airlines International Ltd Middle East Airlines Airliban (MEA) No C 320/10 Official Journal of the European Communities 20. 12. 90
Nationair Canada Virgin Atlantic Airways NFD Luftverkehrs AG YEMENIA Yemen Airways Nigeria Airways Ltd Zambia Airways Corporation Ltd Nippon Cargo Airlines (NCA) ZAS Airline of Egypt Olympic Airways, SA Pakistan International Airlines Corp. (PIA) Pan America World Airways, Inc. Associate members Philippine Airlines Inc. PLUNA — Primeras Lineas Uruguayas de Navegacion Aerea Aero Lloyd Flugreisen GmbH & Co. Luftverkehrs-KG Polskie Linie Lotnicze (LOT) Air America (Air Specialities Corp. d/b/a Air America) Polynesian Airlines Ltd Air Ecosse Ltd Qantas Airways Ltd Air Inter (Lignes Aeriennes Interieures) Royal Air Maroc Air Reunion Royal Jordanian (ALIA — The Royal Jordanian Airline) Air Tahiti Royal Swazi National Airways Corp. Ltd Aloha Airlines, Inc. Ryanair Ltd Ansett Airlines of Australia Sabena (Societe anonyme beige d'exploitation de la navij Ansett New Zealand aerienne) Austral Lineas Aereas SA Saudi Arabian Airlines Corp. (Saudia) Australian Airlines Ltd Scandinavian Airlines System (SAS) Aviaci6n y Comercio, SA (Aviaco) Scottish European Airways Commercial Airways (Pty) Ltd Solomon Airlines DLT Deutsche Luftverkehrsgesellschaft mbH Somali Airlines Douglas Airways (Pty) Ltd South African Airways (SAA) East-West Airlines Sudan Airways Company Ltd Falcon Cargo AB Swedair AB Flight West Airlines Ltd Swiss Air Transport Co. Ltd (Swissair) Intair Syrian Arab Airlines IPEC Aviation TAAG — Linhas Aereas de Angola (Angola Airlines) Kendell Airlines TAP — Air Portugal LAR Transregional (Linhas Regionais SA) Tempelhof Airways USA Inc. Mount Cook Airlines Tower Air Inc. Namib Air (Pty) Ltd Trans-Mediterranean Airways SAL (TMA) Salair AB Transavia Holland BV d/b/a Transavia Airlines Sunflower Airlines Ltd Trans World Airlines Inc. (TWA) Sunstate Airlines Trinidad & Tobago (BWIA International) Airways Corp. TALAIR (Pty) Ltd Tunis Air Transbrasil SA Linhas Aereas (Trans Brasil) Turk Hava Yollari AO (Turkish Airlines) Trans-Jamaican Airlines Ltd United Airlines Transport Aerien Transregional (TAT) USAir, Inc. Vayudoot Ltd UTA (Union de Transports Aeriens) Viacao Aerea Sao Paulo SA (VASP) VARIG SA (Viacao Aerea Rio-Grandense) Wairarapa Airlines Ltd Venezolana Internacional de Aviacion SA (Viasa) Wideroe Flyveselskap A/S