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CNMI’S FREEDOM AIR RUNS INTO LICENSE TURBULENCE Continental urges U.S. transportation agency to review

By Haidee V. Eugenio SAIPAN, CNMI (Saipan Tribune, Dec. 1, 2010) – The Commonwealth of the Northern Mariana Islands (CNMI) Governor Benigno R. Fitial, and other regional leaders support Freedom Air's application with the U.S. Department of Transportation (DOT) to expand the airline's charter services to Hong Kong, Manila, Shanghai, Taipei and Palau, while others like the Air Line Pilots Association International (ALPA) wants the application denied.

Cape Air and Continental Micronesia also separately urged DOT to investigate and carefully consider Freedom Air and its partners Fly Micronesia and World Aviation Inc. before acting on the application.

[PIR editor’s note: Continental Micronesia is a fully owned subsidiary airline of Continental Airlines. It is based at the Antonio B. Won Pat International Airport on Guam and operates daily flights to Hawaii, Asia, Micronesia and Australia.]

Freedom Air, a small commuter air carrier, currently provides air services to Guam, Saipan, Tinian and Rota.

In June, Aviation Services Ltd. doing business as Freedom Air, applied for authority to engage in foreign charter air transportation of persons, property and mail using large aircraft, and asked that its commuter air carrier authority be preserved or other exemption be granted.

Since that filing, Freedom Air's application has received comments and responses to comments in support of and against its application.

Fitial said Freedom Air's pending expansion would provide a significant benefit to Guam and the Commonwealth of the Northern Mariana Islands (CNMI), who both rely on tourism.

"Authorizing Freedom Air to provide charter services will provide more choices for travelers to visit the Northern Marianas and will enable us to further promote economic growth, employment and revenue," Fitial said in a letter to U.S. Transportation Secretary Ray La Hood.

The Air Line Pilots Association said the air transportation that would be provided on these certificates would be provided not by a U.S. citizen but by Fly Micronesia Ltd., a foreign citizen.

The ALPA asks DOT to deny Freedom Air's applications.

Continental Micronesia said it does not oppose Freedom Air's application, but does urge Department of Transportation to consider carefully several unusual issues raised by the application before granting Freedom Air any authority to transform itself from a very small commuter air carrier offering scheduled service with a single Shorts 330 aircraft and air taxi service with small aircraft.

Continental cited, among other things, that although Freedom Air has projected start-up costs of over US$2.56 million, Freedom Air's balance sheet as of February 29, 2010 indicates it has only US$11,185.50 cash in the bank and only US$402,850.72 in total assets.

It also cited that the initial contract between Freedom Air and World Aviation Inc. states that Freedom Air wishes to expand its operations to fly to Hong Kong, China, Japan and the Philippines "but lacks resources to fund this expansion."

Cape Air said substantial questions requiring rigorous examination by DOT are raised by Freedom Air's applications, and "urges the department to investigate Freedom Air, Fly Micronesia, and WAI Asia thoroughly

CNMI Delegate Gregorio Kilili Sablan and Guam Delegate Madeleine Bordallo also separately wrote to Department of Transport in full support of Freedom Air's application.

The Marianas Visitors Authority and the American Samoa Visitors Bureau separately wrote to DOT, in support of Freedom Air's application.

Others who wrote to the Department to support Freedom Air in its applications were the A.B. Won Pat/Guam International Airport Authority and the Guam Chamber of Commerce.

The Department of Transport earlier asked Freedom Air to submit additional information and clarify other information.

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