BEFORE THE i

DEPARTMENT OF TRANSPORTATION 'A? , a=--, . . _

WASHINGTON, D.C. i , : * : ;7

Application of:

TRANSPORTACION AEREA DEL MAR DE ) CORTES, S.A. de C.V. ) Docket OST-07- 277aA-I

1 1

under 49 U.S.C. Section 40109 ) for a one year exemption (MEXICO-US) )

APPLICATION OF

TRANSPORTACION AEREA DEL MAR DE CORTES, S.A. de C.V

FOR AN EXEMPTION

Pursuant to 49 U.S.C. 40109 and Subpart D of the Department's

Rules of Practice in Proceedings, TRANSPORTACION AEREA DEL MAR

DE CORTES, S.A. de C.V. (CORTES), A mexican air taxi operator

of small aircraft, requests an exemption from 49 U.S.C 41301

to authorize CORTES to engage in charter foreign air

transportation of persons and their accompanying baggage

between Mexico and the United States. CORTES also requests

stopover privileges and relief from the requirement to obtain

advance approval for each Mexico-U.S. flight. CORTES requests

that this exemption be granted for a period of at least one

year.

1

In support of this application, and pursuant to the

Department's Procedural Regulations, CORTES states the following:

1. CORTES, incorporated in Mexico in 2001, is a privately held

corporation that is 100% owned and controlled by Mexican

citizens. Name, citizenship and percentage of ownership of

CORTES are enumerated in Exhibit A.

The full name and corporate address of CORTES is:

TRANSPORTACION AEREA DEL MAR DE CORTES, S.A. MONTE CAUCASO # 915 40 PIS0 Lomas de Chapultepec Mexico, D.F. 11000 MEXICO

2. The name and official address of the government air transport

authority in Mexico having regulatory jurisdiction over CORTES

is :

Secretaria de Comunicaciones y Transportes Direccion General de Aeronautica Civil ( IIDGAC") Av. Providencia No. 807, Piso 1-7 Colonia del Valle Delegacion Benito Juarez Mexico, D.F. 03100 MEXICO

3. As noted above, CORTES is seeking transborder charter

authority to engage in foreign air transportation of persons and

their belongings without the need for prior Department approval

2

of each flight, or series of flights. CORTES is also requesting

stopover privileges.

4. CORTES is operationally and financially qualified to perform

the service for which authority is requested herein. As evidence

thereof:

(a) The Mexican DGAC has issued a permit authorizing

CORTES to conduct non-scheduled, international air taxi

transportation of passengers in the North and South American

Continents. This permit is valid indefinitely and is attached as

Exhibit B.

(b) In 2006, CORTES received its DGAC permits and

commenced commercial flight operations. From its base in Toluca,

Edo. de Mexico, CORTES provides air transportation to domestic

and international passengers, consisting of members of the

following institutions which form part of the governing body,

owners, and stock holders of CORTES:

TRANSPORTACION AEREA DEL MAR DE CORTES, S.A. GRUPO AZUCARERO MEXICO, S.A. GRUPO EMBOTELLADORAS UNIDAS, S.A.

Future operations, including its proposed U.S. service, are

likely to be a continuation of this type of operation. CORTES

3

estimates that it will operate 15 round trip flights

annually between Mexico and the United States with an average

load of five passengers per flight; all of which will originate

in Mexico.

(c) CORTES owns and operates a single 8 pass ngei

Brittish Aerospace Hawker Mod 800a Jet aircraft with Mexican

registration XA-TVI.

(d) CORTES maintains its aircraft pursuant to a

maintenance service agreement with Aero Servicios Tecnicos ; in

Monterrey, Mexico, an authorized D.G.A.C. Service Center. In

accordance with an airworthiness program approved by the Mexican

DGAC in compliance with ICAO Annexes 1,6 (Part I) and 7.

(e) CORTES has established a well qualified management

team with the necessary experience in providing domestic and

international air taxi services.

Sr. Juan I. Gallardo Thurlow has served as the

President of CORTES since its inception in 2001

Cap. Federico Peters Acosta has served as the General

Manager of CORTES since its inception in 2001.

Capt. Federico Peters Acosta has been with the company

4

since 2001. Capt. Peters received his Pilot's License in 1977.

He received his Commercial Pilot's License in 1979 and has

accumulated over 5500 hours of flight during his years of

aviation experience, with over 2000 hours in the Hawker 800.

Capt. Peters is licensed to operate the company's Hawker

aircraft. He attends annual flight training courses at Simuflite

in Wichita, Kansas.

He also holds the position of Chief Pilot in the company.

Capt. Jose T. Barajas has been with CORTES since 2005.

Capt. Barajas received his Pilot's License in 1981. He received

his Commercial Pilot's License in 1985 and has accumulated over

6000 hours of flight during his years of aviation experience,

with over 2000 hours in the Haker 800a. Capt. Barajas is licensed

to operate the company's Hawker 800. He attends annual flight

training courses at Simuflite in Wichita, Kansas.

He also holds the position of Chief of Security and Quality

Control in the company.

A composite of CORTES's key personnel is shown in Exhibit C.

5

(f) CORTES's financial statement for calendar year 2006

up to September of 2006 is Exhibit D. As can be seen, CORTES has

been self-sufficient and fully capable to continue providing

transportation services to the companies enumerated in Paragraph

4 (b) . (9) A copy of OST form 6411, Foreign Air Carriers

Certificate of Insurance, is attached as Exhibit E. As shown

therein, CORTES's limits of liability exceed the requirements of

14 CFR Part 205.

(h) CORTES has not been involved in any safety

violations, tariff violations or fatal accidents since its

inception.

(i) CORTES does not have any agreement or cooperative

working arrangements with any U.S. air carrier affecting its

proposed services to the United States

5. CORTES's proposed U.S. services are consistent with the public

interest for the following reasons:

(a) CORTES will be carrying executives to the U.S. on

business, thereby fostering commerce between Mexico and the

United States consistent with the objectives of the North

American Free Trade Agreement (NAFTA) .

6

(b) CORTES's request for stopover privileges is

consistent with the need of the executives using its services who

will, from time to time, need to stop at two or more places in

the U.S. as part of their round trip itineraries. CORTES submits

that no regulatory purpose would be served by preventing CORTES

from responding to the stopover needs of its customers.

WHEREFORE, CORTES respectfully requests exemption authority

to engage in charter foreign air transportation of persons and

their accompanying baggage with small aircraft as set forth

herein, and such other relief as may be in the public interest.

W Agent for Service in the U.S. for

TRANSPORTACION AEREA DEL MAR DE CORTES, S.A.

22 March 2007

7

CORTES EXHIBIT A

OWNERSHIP

of

TRANSPORTACION AEREA DEL MAR DE CORTES, S.A. de C.V.

SR. EDUARDO SANCHEZ N. MEXICAN 25%

CERTIFIED TRUE

EUGENE SMITH AGENT FOR SERVICE f o r TRANSPORTACION AEREA DEL MAR DE CORTES, S.A. de C.V.

CORTES EXHIBIT B

D.G.A.C. INTERNATIONAL AIR TAXI PERMIT

of

TRANSPORTACION AEREA DEL MAR DE CORTES, S.A. de C.V.

,. . SUBSECRETARIA DE TRANSPORTE. DIRECCION GENERAL DE AERONAUTICA CIVIL. OFlClO NO. 4. I. I02.306,-898

SECRETARIA Y TRANSPORTES DE coMuNICAC1oNES ASUNT0:Se concede permiso para establecer y explotar un servicio priblico de transporte no regular de taxi a6reo internacional de pasajeros.

* OPERADOR MEXICANO.

MQxico, D.F. a 0' 6 3UN 20% *

TRANSPORTACI~N AEREA

EL PERMISION ART~CULOS 14 Y I 5

1 1 ) ~ El presente permi transporte de taxi abreo naci fecha 25 de mayo del 2004.

844 un servicio pljblico de

EQUIPO AUTORIZADO A OPERAR HACIA TODO EL MUNDO (SUJETANDOSE A LOS L~MITES GEOGRAFICOS ESTABLECIDOS EN LA POLIZA NO. ~ ~ 8 5 7 2 2 2 ) :

BRITISH AEROSPACE HS- 125-800A MATR~CULA: XA-TVI. /

....................................................................,...................................................... . . ./2

GAC-PE-03-DTCA-GRL-P-0 I -FE-AZ I

SUBSECRETARIA DE TRANSPORTE. DlRECCldN GENERAL DE AERONAUTICA CIVIL.

SECRETARIA DE C6MUNICACIONES Y TRANSPOUTES -

- 2 -

I

Ill).- El presente permiso deberti ser inscrito en el Registro Aeron6utico Mexicano, conforme .a1

. .

Secretaria de Comunicaciones

9.- Apl icdn en est0 Tarifas, Transporte Ferrovi

Direccibn General de

Aeroniiutica-Civil (Departamento de Programaci6n y Estadisticas), en la forma DGAC-1857-1,

XII).- La Empresa deber5 contratar y mantener vigente un seguro que cubra las responsabilidades pw 10s daiios a pasajeros y equipaje, ad como daiios a' personas o cosas que se encuentren en la superficie de territorio mexicano en tCrminos de 10s Articulos 70, 72 y'74 de la Ley de Aviaci6n Civil, 64, 65, 66, V 67,68,69,70,71 y 72 de su Reglame&.

....I 3

I -FE-A2 I

SUBSECRETARIA DE TRANSPORTE. DIRECCION GENERAL DE AERONAUTICA CIVIL

SECRETARIA DE ~MUNICXCIONES Y TRANsPoms

- 3 -

otorgarles todas las facilidades para estos fines, as; corno a proporcionar a la Secretaria 10s informes con 10s datos que permitan conocer la operaci6n y explotaci6n d e 10s servicios de transporte abreo.

....I4

GAC-PE-03-DTCA-GRL-P-0 I -FE-A2 I A,

SUBSECRETARIA DE TRANSPORTE. DIRECCION GENERAL DE AERONAUTICA CIVIL.

L

SECRETARIA DE CDMUNICACIONES Y TRANSPORTES -

- 4 -

v

or un monto

garantizar el curnplimi Ley de Vias Generales de te mientras est6 en vigor

XXIV).- El perrnisionario debed proceder al pago y, por consiguiente, acreditar ante esta Secretaria de Comunicaciones y Transportes, mediante recibo oficial al entero de 10s derechos previstos en 10s articulos 159, fracci6n I I , y 153,, fracci6n. I I , de la Ley Federal de Derechos, 1% cantidades de $10,050.00 M.N. y $535.00 M.N., por concepto.de1 otorgamiento de este permiso e inscripci6n en el Registro Aeroniiutico Mexicpo, 10s cuales fueron cubiertos mediante recibos de pago de fecha 15 de febrero del 2006. *

,...I5

GAC-PE-03-DTCA-GRL-P-0 I -FE-A2 I A

SUBSECRETARIA DE TRANSPORTE. DIRECCI~N GENERAL DE AERONAUTICA CIVIL.

SECRETARIA DE COMUNICACIONES Y TRANSPORTES -

- 5 -

Por otra parte, el permisionario deber4 cubrir anualmente y acreditar mediante recibo oficial, el pago de 10s derechos correspondientes por cada uno de 10s aiios en que se encuentre vigente el perrniso,

. de conformidad con lo dispuesto en 10s articulos 84 de la Ley de Aviaci6n Civil, I93 de su Reglamento y 155, de la Ley Federal de Deiechos, vigente.

I cas0 de IosWios subsecuentes, a cual se"haya otorgado dicho

C.C.P. Direcci6n General. Ofn C.C.P. Direcci6n General de Tarifas, C.C.P. Direcci6n General Adjunta de Aviaci6n.- Ofnas. C.C.P. Direcci6n General Adjunta de Seguridad.- Ofnas. C.C.P. Direcci6n de Aeropuertos.- Ofnas. C.C.P. Direcci6n de Desarrollo Estrat6gfco.- Ofnas. C.C.P. Direcci6n de Registro Aeronhtico y Control de Empresas.- Ofnas. C.C.P. Oficina de Seguros y Fianzas.- Ofnas.

DGAC-PE-03-DTCA-GRL-P-0 I -FE-A2 I

CORTES EXHIBIT C

LIST OF KEY PERSONNEL

CAP. FEDERICO PETERS CHIEF PILOT MEXICAN 011-52722-279-3000

CAP. FEDERICO PETERS CHIEF OPS MEXICAN 0 1 1 - 5 2 7 2 2 - 2 7 9 - 3 0 0 0

CAP. JOSE T. BARAJAS CHIEF SECURITY MEXICAN 011-52722-279-3000

COMPANY ADDRESS FOR ABOVE PERSONNEL IS:

TRANSPORTACION AEREA DEL MAR DE CORTES, S.A. de C.V. MONTE CAUCASO # 915, 4th. FLOOR LOMAS DE CHAPULTEPEC MEXICO, D.F. MEXICO 11000

CORTES EXHIBIT D

FINANCIAL STATEMENT

of

TRANSPORTACION AEREA DEL MAR DE CORTES, S.A. de C.V.

Transportacibn Abrea del Mar de Cortbs, SA de CV.

Expresados en pesos Estado de resultados del 01 de enero a130 de septiembre de 2006

30.1X.06 31.XII. 05

lngresos por senricios de transporte Vueios nacionales Vuelos intemacionales y en franja fronteriza Cuota de exclusividad Pwnoda otros Total

8.971.675 3.283.424 4.950.000

80.234 13.702

17.299.035 17.549.858

Cost0 de lngresos y/o senricios Cos& Fiios

Costos Variables Servicios Calificados Empresas y Servicios Organizados Bosques Gmpo Casa Juan Gallatdo Nons0 Cewera Costos Variables Transmar rentas de vuelos Rf%?xpresi(in Total

5.174.321 6.498.597

2.151.086 100.459 195.198

1.092.669 299.655 180.720 592.608 10.91 9

358.110 374.222

7.995.286 155.685

9.188.963

utilidad m 8.360.896 9.303.749

Gastos de generales Administraci&n Operaddn Reexpresih Total

2.1 05.525 1.1 50.987

3.305.976 9 30.852

247.696 12.914.524 3.256.51 2

Utiridad deoperaci6n 6.047.237 (4.553.628)

ResuJtado integral de financiamiento: intereses ganados Jntereses pagados Resultado cambiario, net0 Reexpmsi6n Total

(25.164) 378.044 102.314

(11.157) 73.929 (4.544)

4.037 (80.525) 455.194

otros (productos) gastos 1 19.335

252.261

CORTES EXHIBIT E

FOREIGN AIR CARRIERS CERTIFICATE OF INSURANCE

OST FORM 6411

of

TRANSPORTACION AEREA DEL MAR DE CORTES, S.A. de C.V.

U.S. Department of Transportation Office of the Secretary of Transportation

effective from December 13th, 2006 terminate coverage is received by the Department of Transportation.

NOTE: Part 205 of the Department‘s Regulations does not allow for a predetermined termination date, and a certificate showing such a date is unacceptable.

1. The Insurer (Check One): IJ is an approved surplus line insurer in the State@) of [XI is licensed or approved by the government of MEXICO 0 is an approved surplus line insurer in the State(s) of

until ten ( IO) days after written notice from the insurer or carrier of the intent to

to issue aircraft insurance policies; or

to comment on the accuracy of the estimate or make suggestions for reducing this burden, please direct your comments to the Department of Transportation at the following address:

’ US. Department of Transportation Office of Aviation Analysis, X-56 400 7th Street, SW. Washington, DC 20590

2, The insurer assumes, under the policy or policies listed below, aircraft accident liability insured to minimums at least equal to the following during operation, maintenance, or use of aircraft in “foreign air transportation” as that term is defined in the Federal Aviation Act. (Complete applicable section(s) below):

A. CANADIAN CHARTER AIR TAXI OPERATORS WITH PART 294 AUTHORITY ONLY The aircraft covered by this policy have (I) 30 or fewer passenger seats and a maximum payload capacity of 7,500 pounds or less; and/or (2) a maximum authorized takeoff weight on wheels of no more than 35,000 pounds. (Check separate or combined coverage as appropriate):

0 Separate Coverages: Minimum Limit

Policy No. Type of Liabilify Each person Each Occurrence

Combined Bodily Injury (Excluding Passengers other than cargo attendants) and Property Damage Liability $ 75,000 $2,000,000 (*) see note

Passenger Bodily Injury Liability $75,000 $75,000 x 75% of total number of passenger seats installed in aircraft

0 Combined Coverage: This combined coverage is a single limit of liability for each occurrence at least equal to the required minimums stated above for bodily injury (excluding passengers), property damaged, and passenger bodily injury.

Policy No. . Amount of Coverage

0 This policy covers CARGO operations only and excludes passenger liability insurance.

* NOTE: If the aircraft covered by this policy have more than 30 passenger seats or more than a maximum payJoad capacity of 7,500 pounds, the minimum limit per occurrence shall be $20,000,000.

OST Form 6410

0 Separate Coverages:

Policy No. Type of Liability Each person Each Occurrence

Combined Bodily Injury (Excluding Passengers other than cargo attendants) and Property Damage Liability $300,000 $2,000,000

Passenger Bodily Injury $300,000 $300,000 x 75% of total number of passenger seats installed in aircraft

Combinec?Coverage: This combined coverage is a single limit of liability for each occurrence at least equal to the required minimums stated above for bodily injury (excluding passengers), property damaged, and passenger bodily injury.

Policy No. AVIMTAR / 955

This policy covers CARGO operations only and excludes passenger liability insurance.

Amount of Coverage $50.000,000. U.S. Dollars 1

C. FOREIGN AIR CARRIERS OPERATING LARGE AIRCRAFT The aircraft covered by this policy are LARGE AIRCRAFT (Le., with more than 60 passenger seats or with a maximum payload capacity of more than 18,000 pounds). (Check separafe or combined coverage as appropn'afe):

17 Separate Coverages: Minimum Limit

Policy No. Type of Liabi/ify Each person Each Occurrence

Combined Bodily Injury (Excluding Passengers other than cargo attendants) and Property Damage Liability $300,000 $20,000,000

Passenger Bodily Injury $300,000 $300,000 x 75% of total number of passenger seats installed in aircraft

0 Combined Coverage: This combined coverage is a single limit of liability for each occurrence at least equal to the required minimums stated above for bodily injury (excluding passengers), property damaged, and passenger bodily injury.

Policy No. Amount of Coverage

17 This policy covers CARGO operations on/y and excludes passenger liability insurance. ~~

Make and Model FAA or Foreign Flag

Rayhtheon Hawker 800,

The policy or policies listed in this certificate insure(s) (Check One):

Operations conducted with all aircraft operated by the insured 0 Operations conducted with the following types of aircraft:

Operations with the following aircraft: (Use additional page if necessary) SERIAL 258004 YEAR 1984

3.

4. Each policy listed in this certificate meets or exceeds the requirements in 14 CFR Part 205. ALLIANZ MEXICO CIA SEGUROS

(Name of Insurer) Willis MEXICO

(Name of Broker, if applicable)

Blvd.. Manuel Avila Camacho 164 Av. Santa Fe No 495 Piso I O (Address) (Address)

Col. Lomas de Barrilaco Mexico D.F CP 11010 (City, State, Zip Code)

Col. Cruz Manca CP 05349 (City, State, Zip Code)

Juan Pablo Cas0 Consuelo Martinez Contact (person who can verify the effectiveness of the coverage) (Officer or authorized representative)

5255-5201 -31 77 / 5255-5201-3188 (3177)

December 13th, 2006 (Date)

Decembdr 13th, 2006 (Date)