THE COMMISSION OF THE CARTAGENA AGREEMENT,

HAVING SEEN: Chapter XI of the Cartagena Agreement, the Act of La Paz, signed on the occasion of the IV Andean Presidential Council, the Recommendations issued by the II Meeting of the Andean Committee of Aeronautical Authorities, Resolution I-RE.123 of the I Special Meeting of Ministers of Transportation, Communications and Public Works of the Member Countries of the Cartagena Agreement, held in Caracas, Venezuela on May 13 and 14, 1991, and Board Proposal 234/Rev. 1;

WHEREAS:

The Strategic Design for the Orientation of the Andean Group points out that "there is a noticeable general trend toward economic opening aimed at, among other things, exposing the production system to the rigors of competition and prompting increased competition." It also "underscores the execution of policies and actions aimed at improving, broadening and modernizing the capacity of the infrastructure and the rendering of transport and communication services, whose shortage and high costs today are impeding the rapid and secure interlinkage of the centers of production and consumption."

In the sphere of regional physical integration, the Strategic Design resolved "to hold a meeting of national air transport authorities in order to promote bilateral and multilateral agreements for improving Subregional air services and cooperation agreements for the joint use of the infrastructural and equipment capacities, and the adoption of joint positions vis-�-vis third parties."

In the Act of La Paz, signed at the IV Andean Presidential Council, the Presidents of the Subregional countries decided to adopt the "Andean open skies" policy and instructed the Board of the Cartagena Agreement to draw up a proposal for study at the next meeting of the Presidential Council, based on the initiatives put forward by Venezuela and Colombia in this regard;

The Andean Committee of Aeronautical Authorities, at its II Meeting held on March 18 and 19, 1991, approved through Resolution CAAA No. II-1, the document entitled "Andean Air Transport Policy," which includes a series of principles designed in response basically to that Presidential Guideline:

DECIDES:

CHAPTER I

DEFINITIONS

Article 1.- For purposes of this Decision, the following definitions apply:

All-included package: The combined air transport and tourist services that the traveler purchases in a single operation.

Board: Board of the Cartagena Agreement.

Commission: Commission of the Cartagena Agreement.

Competent National Agencies: The Civil Aeronautical Authorities of the Member Countries.

Country of Origin: The territory of the State of which the carrier that embarks passengers and loads cargo and in which the respective air transport fares and rates are set, is a national.

First Freedom: The right to fly through the territory of another country without landing.

Second Freedom: The right to land in another country for non-commercial purposes.

Third Freedom: The right to, in another country, disembark passengers and unload cargo and mail that had embarked and been loaded in the territory of the country of which the carrier is a national.

Fourth Freedom: The right to, in a country, embark passengers and load cargo and mail that are to be flown to the territory of the country of which the carrier is a national.

Fifth Freedom: The right to, in a country other than that of which the carrier is a national, embark passengers and load cargo and mail that are to be flown to another country in the Subregion or outside it, which is also not the country of which the carrier is a national.

Member Country: One of the Member Countries of the Cartagena Agreement.

Multiple designation: The designation by a country of two or more airlines to provide international air transport services.

Operating certificate: The document issued by the Aeronautical Authority of a Member Country accrediting the authorization granted to a carrier to provide a given air service.

Regular flights: Flights that are made following pre-established itineraries and timetables.

Series of flights: Two or more unscheduled flights that are planned and made together.

Unscheduled flights: Flights that are made which are not subject to pre-established itineraries and timetables.

CHAPTER II

SCOPE OF APPLICATION

Article 2.- The Member Countries shall implement this Decision in providing regular and unscheduled international air passenger, cargo and mail transport services in their respective territories and between them and countries outside the Subregion.

Article 3.- This Decision in no way implies restricting the facilities that Member Countries have granted or could grant to each other under bilateral or multilateral agreements.

Article 4.- Without detriment to the freedoms granted in this Decision, the Member Countries also concede to each other the right to the first and second air freedoms.

CHAPTER III

ON THE CONDITIONS FOR MAKING REGULAR AND

UNSCHEDULED FLIGHTS WITHIN THE SUBREGION

Article 5.- The Member Countries grant each other the free exercise of the third, fourth and fifth air freedoms for regular passenger, cargo and mail flights within the Subregion.

Article 6.- The Member Countries adopt a regime of freedom for the unscheduled cargo flights of their carriers that are made within the Subregion.

Article 7.- The Member Countries, in compliance with this Decision and pursuant to the provisions of the Andean Air Transport Policy, shall review the operating permits, bilateral agreements or other administrative acts in effect between them and shall make any changes in accordance with them; these they shall orient toward the free exchange of commercial air rights within the Subregion which are in the interest of the community and which ensure healthy competition and the quality and efficiency of international air transport service.

Article 8.- Insofar as taxes are concerned, the pertinent provisions of the Agreement between the Member Countries to avoid double taxation, approved through Commission Decision 40, shall be applied to Subregional carriers.

Article 9.- The Member Countries accept the principle of multiple designation for the provision of regular passenger, cargo and mail services. The Andean Committee of Aeronautical Authorities shall adopt, within a period of ninety (90) days after approval of this Decision, the necessary uniform regulations for the application of this principle, while guaranteeing free access to the market at all times.

Article 10.- The corresponding Competent National Agencies shall automatically grant authorizations to provide unscheduled passenger, cargo and mail air transport services within the Subregion by the national carriers of the Member Countries.

The following conditions shall be observed in granting authorizations to provide unscheduled passenger flights:

a) The applications shall be presented to the respective Authority, accompanied by the documents containing the operating certificates of the country of which the carrier is a national, and the corresponding insurance contract. These documents may be included in a certification issued by the Competent National Agency.

b) They shall be authorized for provision between points where there are no established regular air services. If such regular services do exist, the authorizations shall be granted provided that the unscheduled flights offered do not jeopardize the economic stability of existing regular services.

c) When series of unscheduled flights are requested, they must be part of "all-included packages" and shall necessarily be provided on a round-trip basis, with pre-established departure and arrival times.

Failure to comply with these conditions shall result in the application of penalties in accordance with the legislation in effect in each Member Country.

CHAPTER IV

ON THE CONDITIONS FOR MAKING FLIGHTS OUTSIDE

THE SUBREGION

Article 11.- The Member Countries shall, before December 31, 1992 and subject to bilateral or multilateral negotiations, while maintaining the principle of equity and under appropriate formulas for compensation, grant each other fifth freedom air traffic rights for regular flights. They shall also establish the conditions for making unscheduled passenger flights between Subregional and third countries.

Article 12.- The Member Countries shall adopt a regime of freedom for their carriers� unscheduled cargo flights between Subregional and third countries.

CHAPTER V

ON THE ANDEAN COMMITTEE OF AERONAUTICAL AUTHORITIES

Article 13.- The Andean Committee of Aeronautical Authorities, created by Resolution V.104 of the V Meeting of Ministers of Transportation, Communications and Public Works of the Member Countries, shall be responsible for ensuring integral compliance with and application of this Decision.

Article 14.- The Andean Committee of Aeronautical Authorities shall be comprised of the authority responsible for civil aviation in each Member Country and his alternate, who shall act as the Titular and Alternative Representatives of that country, respectively, and shall be accredited before the Board.

Article 15.- The Andean Committee of Aeronautical Authorities has the following responsibilities:

a) To ensure and evaluate the implementation of Commission Decisions on air transport;

b) To recommend solutions to any problems that may arise with regard to that matter both in and outside the Subregion;

c) Those stipulated in the Commission Decisions;

d) To recommend objectives, policies, programs and actions for developing and facilitating air services;

e) To promote the harmonization and updating of the legal rules and regulations, techniques, and provisions in effect in the Member Countries with regard to aeronautical matters;

f) To call the attention of the Board or of the competent national agencies to the working documents and guidelines studied previously at the Committee meetings, in order to arrive at resolutions and agreements concerning the aeronautical sector;

g) To ask the Board or, through it, the competent national agencies and the international organizations, for the necessary assistance in performing studies, conducting seminars, implementing working programs and taking other actions aimed at modernizing air transport services and making them more effective;

h) To continuously register and disseminate information about the air carriers operating in the Andean Subregion, the statistics on the traffic in passengers and goods, and the rules, regulations and provisions in each Member Country that are applicable to air transport;

i) To set up working groups to prepare studies or take actions that would complement Committee resolutions;

j) To coordinate joint positions for negotiating with third parties that would enable the Subregion to obtain maximum benefits, to which end it shall set up a negotiating team in each case; and

k) To issue its own regulations.

Article 16.- The Andean Committee of Aeronautical Authorities shall meet at least twice a year in regular session, such to take place in the first and third quarters of each year.

It shall also meet in special session whenever requested to do so by one or more of the competent national agencies of the Member Countries, the Board or the Commission.

CHAPTER IV

GENERAL PROVISIONS

Article 17.- Each Member Country shall let the other Member Countries know the names of the designated national carriers and the commercial air rights they shall exercise, both in and outside the Subregion. They shall also let each other know the names of the carriers from outside the Subregion and the commercial air rights they shall exercise.

Article 18.- Each Member Country shall inform the other Member Countries and the Board, on a timely basis, about the national provisions in effect in their respective territories for conceding authorizations for routes, frequencies, itineraries and regular flight schedules, as well as authorizations for unscheduled flights.

Article 19.- The Commission, within a period of one hundred and eighty days (180) after this Decision enters into force, shall adopt and put into effect a regulatory framework aimed at preventing or correcting distortions created by unfair trade practices in air transport services.

Article 20.- The country of origin principle shall be applied to rates within the Subregion.

Article 21.- This Decision shall enter into force on the day of its publication in the Official Gazette of the Cartagena Agreement.


Signed in the city of Caracas, Venezuela, on the sixteenth of May of nineteen ninety-one.