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Agreement between the Government of Canada and the Government of the Islamic Republic of Pakistan on Air Transport [1996] CATSer 2 (15 January 1996)

E100242 - CTS 1996 No. 3

AGREEMENT BETWEEN THE GOVERNMENT OF CANADA AND THE GOVERNMENT OF THE ISLAMIC REPUBLIC OF PAKISTAN ON AIR TRANSPORT

The Government of Canada and the Government of the Islamic Republic of Pakistan, hereinafter referred to as the Contracting Parties,

Being parties to the Convention on International Civil Aviation opened for signature at Chicago, on the 7th day of December, 1944,

And desiring to conclude an agreement for the purpose of establishing air services between their respective territories and beyond.

Have agreed as follows:

ARTICLE I

For the purpose of this Agreement, unless otherwise stated:

(a) "Aeronautical Authorities" means, in the case of Canada, the Minister of Transport and the Canadian Transport Commission and, in the case of Pakistan, the Director-General of the Civil Aviation Authority, or, in both cases, any other authority or person empowered to perform the function now exercised by the said authorities;

(b) "Agreed Services" means scheduled air services on the routes specified in the Annex to this Agreement for the transport of passengers, cargo and mail, separately or in combination;

(c) "Agreement" means this Agreement, the Annex attached thereto, any amendments to the Agreement or to the Annex;

(d) "Convention" means the Convention on International Civil Aviation opened for signature at Chicago on the seventh day of December 1944 and includes any Annex adopted under Article 90 of that Convention and any amendment of the Annexes or of the Convention under Articles 90 and 94 thereof so far as those Annexes and amendments have been adopted by both Contracting Parties;

(e) "Designated airline" means an airline which has been designated and authorized in accordance with Articles IV and V of this Agreement;

(f) "Tariffs" means the prices to be paid for the carriage of passengers, baggage and cargo and the conditions under which those prices apply, including prices and conditions for other services performed by the carrier in connection with air transportation, but excluding remuneration and conditions for the carriage of mail;

(g) "Territory", "Air service" "International Air service"" "Airline" and "Stop for non-traffic purposes" have the meaning respectively assigned to them in Articles 2 and 96 of the Convention;

ARTICLE II

1. Each Contracting Party grants to the other Contracting Party, except as otherwise specified in the Annex, the following rights for the conduct of international air services by the airline or airlines designated by that other Contracting Party:

(a) to fly without landing across its territory;

(b) to land in its territory for non-traffic purposes; and

(c) to land in its territory for the purpose of taking up and discharging, while operating the routes specified in the Annex, international traffic in passengers, cargo and mail, separately or in combination.

2. The airlines of each Contracting Party, not otherwise designated in accordance with Articles IV and V of this Agreement, but licensed to operate schedule international air services on regular basis, and are in practice operating such services, shall also enjoy the rights specified in paragraph 1 (a) and 1 (b) of this Article.

3. Nothing in paragraph 1 of this Article shall be deemed to confer on a designated airline of one Contracting Party the privilege of taking up, in the territory of the other Contracting Party, passengers, cargo and mail carried for the remuneration or hire and destined for another point in the territory of that other Contracting Party.

ARTICLE III

A designated airline of one Contracting Party may make a change of aircraft at any point on the specified route only on the following conditions:

(i) That it is justified by reason of economy of operation;

(ii) that the capacity of the aircraft used on the section of the route more distant from the territory of the Contracting Party designating the airline is not larger than that used on the nearer section;

(iii) that the aircraft of smaller capacity shall operate only in connection with the aircraft of larger capacity and shall be scheduled to do so; the former shall arrive at the point of change for the purpose of carrying traffic transferred from, or to be transferred into, the aircraft of larger capacity; and their capacity, shall be determined with primary reference to this purpose;

(iv) that there is an adequate volume of through traffic;

(v) that the airline shall not hold itself out to the public by advertisement or otherwise as providing a service which originates at the point where the change of aircraft is made, unless otherwise permitted;

(vi) that in connection with any one aircraft flight into the territory of the other Contracting Party, only one flight may be made out of that territory unless the airline is authorized by the aeronautical authorities of the other Contracting Party to operate more than one flight; and

(vii) that the provisions of Article XI of the present Agreement shall govern all arrangements made with regard to change of aircraft.

ARTICLE IV

Each Contracting Party shall have the right to designate, by diplomatic note, an airline or airlines to operate the agreed services on the routes specified in the Annex for such a Contracting Party and to substitute another airline for that previously designated.

ARTICLE V

1. Following receipt of a notice of designation or of substitution pursuant to Article IV of this Agreement, the aeronautical authorities of the other Contracting Party shall, consistent with its law and regulations, grant without delay to the airline or airlines so designated the appropriate authorizations to operate the agreed services for which that airline has been designated.

2. Upon receipt of such authorizations the airline may begin at any time to operate the agreed services, in whole or in part, provided that the airline complies with the applicable provisions of this Agreement in particular that tariffs are established in accordance with the provisions of Article XIV of this Agreement.

ARTICLE VI

1. The aeronautical authorities of each Contracting Party shall have the right to withhold the authorizations referred to in Article V of this Agreement with respect to an airline designated by the other Contracting Party, to revoke or suspend such authorizations or impose conditions, temporarily or permanently:

(a) in the event of failure by such airline to qualify before the aeronautical authorities of that Contracting Party under the laws and regulations normally and reasonably applied by these authorities in conformity with the Convention;

(b) in the event of failure by such airline to comply with the laws and regulations of that Contracting Party;

(c) in the event that they are not satisfied that substantial ownership and effective control of the airline are vested in the Contracting Party designating the airline or in its nationals; and

(d) in case the airline otherwise fails to operate in accordance with the conditions prescribed under this Agreement.

2. Unless immediate action is essential to prevent infringement of the laws and regulations referred to above, the rights enumerated in paragraph 1 of this Article shall be exercised only after consultations with the aeronautical authorities of the other Contracting Party in conformity with Article XXI of this Agreement.

ARTICLE VII

1. The laws, regulations and procedures of one Contracting Party relating to the admission to, remaining in, or departure from its territory of aircraft engaged in international air navigation or to the operation and navigation of such aircraft shall be complied with by the designated airline or airlines of the other Contracting Party upon entrance into, departure from and while within the said territory.

2. The laws and regulations of one Contracting Party respecting entry, clearance, transit, immigration, passports, customs and quarantine shall be complied with by the designated airline or airlines of the other Contracting Party and by or on behalf of its crews, passengers, cargo and mail upon transit of, admission to, departure from and while within the territory of such a Contracting Party.

ARTICLE VIII

1. Certificates of airworthiness, certificates of competency and licences, issued or rendered valid by one Contracting Party and still in force, shall be recognized as valid by the other Contracting Party for the purpose of operating the agreed services on the routes specified in the Annex provided that such certificates or licences were issued or rendered valid pursuant to, and in conformity with, the standards established under the Convention. Each Contracting Party reserves the right, however, to refuse to recognize, for the purpose of flights above its own territory, certificates of competency and licences granted to its own nationals by the other Contracting Party.

2. If the privileges or conditions of the licences or certificates referred to in paragraph 1 above, issued by the aeronautical authorities of one Contracting Party to any person or designated airline or in respect of an aircraft operating the agreed services on the routes specified in the Annex, should permit a difference from the standards established under the Convention, and which difference has been filed with the International Civil Aviation Organization, the aeronautical authorities of the other Contracting Party may request consultation in accordance with Article XXI of this Agreement with the aeronautical authorities of that Contracting Party with a view to satisfying themselves that the practice in question is acceptable to them. Failure to reach a satisfactory agreement in matters regarding flight safety will constitute grounds for the application of Article VI of this Agreement.

ARTICLE IX

1. Consistent with their rights and obligations under international law, the Contracting Parties reaffirm that their obligation to each other to protect the security of civil aviation against acts of unlawful interference forms an integral part of this Agreement.

2. Without limiting the generality of their rights and obligations under international law, the Contracting Parties shall in particular act in conformity with the provisions of the Convention on Offences and Certain Other Acts Committed on Board Aircraft, signed at Tokyo on September 14, 1963 the Convention for the suppression of Unlawful Seizure of Aircraft, signed at The Hague on December 16, 1970 and the Convention for the Suppression of Unlawful Acts Against the Safety of Civil Aviation, signed at Montreal on September 23, 1971 and any other multilateral agreement governing aviation security binding upon both Contracting Parties.

3. The Contracting Parties shall provide upon request all possible assistance to each other to prevent acts of unlawful seizure of civil aircraft and other unlawful acts against the safety of such aircraft, their passengers and crew, airports and air navigation facilities, and any other threat to the security of civil aviation.

4. The Contracting Parties shall act in conformity with the aviation security provisions established by the International Civil Aviation Organization and designated as Annexes to the Convention on International Civil Aviation to the extent that such security provisions are applicable to the Contracting Parties; they shall require that operators of aircraft of their registry, operators of aircraft who have their principal place of business or permanent residence in their territory, and the operators of airports in their territory act in conformity with such aviation security provisions.

5. Each Contracting Party agrees that its operators of aircraft may be required to observe the aviation security provisions referred to in paragraph 4 above required by the other Contracting Party for entry into, departure from, or while within the territory of that other Contracting Party. Each Contracting Party shall ensure that adequate measures are effectively applied within its territory to protect the aircraft and to inspect passengers, crew, carry-on items, baggage, cargo and aircraft stores prior to and during boarding and loading.

6. Each Contracting Party shall give sympathetic consideration to any request from the other Contracting Party for reasonable special security measures to meet a particular threat.

7. Each Contracting Party shall also give sympathetic consideration to a request from the other Contracting Party, in accordance with Article XXI, paragraph (1) whereby the aeronautical authorities of one Contracting Party could visit the aeronautical authorities of the other Contracting Party, on a reciprocal basis, for the purpose of assessing the security measures being carried out by aircraft operators in respect of flights destined to the territory of the first Contracting Party.

8. When a Contracting Party has reasonable grounds to believe that the other Contracting Party has departed from the previsions of this Article, the first Contracting Party may request immediate consultations with the other Contracting Party. Failure to reach a satisfactory agreement will constitute grounds for the application of Article VI of this Agreement.

9. When an incident or threat of an incident of unlawful seizure of civil aircraft or other unlawful acts against the safety of such aircraft, their passengers and crew, airports or air navigation facilities occurs, the Contracting Parties shall assist each other by facilitating communications and other appropriate measures intended to terminate rapidly and safely such incident or threat thereof.

ARTICLE X

1. The charges imposed in the territory of one Contracting Party on the designated airline of the other Contracting Party for the use of airports and other aviation facilities by the aircraft of the designated airline of the other Contracting Party shall not be higher than those imposed on a national airline of the first Contracting Party engaged in similar international services.

2. Each Contracting Party shall encourage consultations between its competent charging authorities and the designated airlines using the services and facilities, and where practicable, through the airlines representative organizations. Reasonable notice should be given to users of any proposals for changes in user charges to enable them to express their views before changes are made.

3. Neither of the Contracting Parties shall give preference to its own or any other airline over an airline engaged in similar international air services of the other Contracting Party in the application of its customs, immigration quarantine and similar regulations or in the use of airports, airways, air traffic services and associated facilities under its control.

ARTICLE XI

1. There shall be fair and equal opportunity for the designated airline or airlines of each Contracting Party to operate the agreed services on the routes specified in the Annex to this Agreement.

2. In operating the agreed services, the designated airline or airlines of each Contracting Party shall take into account the interest of the airline or airlines of the other Contracting Party so as not to affect unduly the services which the latter provides on the whole or part of the same route.

3. The agreed services provided by the designated airlines of the Contracting Parties shall bear reasonable relationship to the requirements of the public for transportation on the specified routes and shall have as their primary objectives the provision, at a reasonable load factor, of capacity adequate to meet the current and reasonably anticipated requirements for the carriage of passengers, cargo and mail between the territories of the Contracting Parties which have designated the airline or airlines and the countries of ultimate destination of the traffic.

4. Provision for the carriage of passengers, cargo and mail both taken up and discharged at points on the specified routes in the territories of States other than that designating the airline shall be made in accordance with the general principle that capacity shall be related to:

(a) traffic requirements to and from the territory of the Contracting Party which has designated the airline;

(b) traffic requirements of the area through which the airline passes after taking into account of other transport services established by airlines of the States comprising the area; and

(c) the requirement of through airline operation.

5. The capacity to be provided on the specified routes shall be agreed between the designated airlines in accordance with the principles laid down in this Article and subject to the approval of the aeronautical authorities of the Contracting Parties. In the absence of an agreement between the designated airlines, the matter shall be referred to the aeronautical authorities of the Contracting Parties which will endeavour to resolve the problem, if necessary, pursuant to Article XXI of this Agreement. Pending an arrangement either at the airline level or between the aeronautical authorities the status quo shall be maintained.

ARTICLE XII

1. The aeronautical authorities of each Contracting Party shall provide or shall cause their designated airlines to provide the aeronautical authorities of the other Contracting Party, upon request, periodic or other statements of statistics as may be reasonably required for the purpose of reviewing the operation of the agreed services, including, but not limited to, statements of statistics related to the traffic carried by its designated airlines between points on the routes specified in the Annex to this Agreement showing the initial origins and final destinations of the traffic.

2. The details of the methods by which such statistics shall be provided shall be agreed upon between the aeronautical authorities and implemented without delay after a designated airline of one or both Contracting Parties commences operation, in whole or in part, on the agreed services.

ARTICLE XIII

1. Each Contracting Party shall on a basis of reciprocity exempt the designated airline or airlines of the other Contracting Party to the fullest extent possible under its national law from import restrictions, customs duties, excise taxes, inspection fees and other national duties and charges on aircraft, fuel, lubricating oils, consumable technical supplies, spare parts including engines, regular aircraft equipment, aircraft stores (including liquor, tobacco and other products destined for sale to passengers in limited quantities during the flight) and other items intended for use or used solely in connection with the operation or servicing of aircraft of the designated airline or airlines of such other Contracting Party operating the agreed services, as well as printed ticket stock, air way bills, any printed material which bears the insignia of the company printed thereon and usual publicity material distributed without charge by that designated airline.

2. The exemptions granted by this Article shall apply to the items referred to in paragraph 1 of this Article:

(a) introduced into the territoty of one Contracting Party by or on behalf of the designated airline or airlines of the other Contracting Party;

(b) retained on board aircraft of the designated airline or airlines of one Contracting Party upon arriving in or leaving the territory of the other Contracting Party;

(c) taken on board aircraft of the designated airline or airlines of one Contracting Party in the territory of the other Contracting Party and intended for use in operating the agreed services;

whether or not such items are used or consumed wholly within the territory of the Contracting Party granting the exemption, provided such items are not alienated in the territory of the said Contracting Party.

3. The regular airborne equipment, as well as the materials and supplies normally retained on board the aircraft of the designated airline or airlines of either Contracting Party may be unloaded in the territory of the other Contracting Party only with the approval of the Customs authorities of that territory. In such case, they may be placed under the supervision of the said authorities up to such time as they are re-exported or otherwise disposed of in accordance with Customs regulations.

ARTICLE XIV

1. The tariffs to be charged by the designated airline or airlines of one Contracting Party for carriage to or from the territory of the other Contracting Party shall be established at reasonable levels, due regard being paid to all relevant factors, including cost of operation, reasonable profits, and where it is deemed suitable, the tariffs of other airlines.

2. The tariffs referred to in paragraph 1 of this Article shall be agreed by the designated airlines concerned for both Contracting Parties and such agreement may be reached by the use of the procedures of the International Air Transport Association for the working out of tariffs.

3. The tariffs so agreed shall be submitted for the acceptance of the aeronautical authorities of both Contracting Parties at least forty-five (45) days before the proposed date of their introduction. In special cases, this period may be reduced, subject to the agreement of the said authorities.

4. If neither of the aeronautical authority has expressed disapproval within thirty (30) days from the date of submission, in accordance with paragraph 3 of this Article, these tariffs shall be considered as approved. In the event of the period for submission being reduced, as provided for in paragraph 3, the aeronautical authorities may agree that the period within which any disapproval must be notified shall be less than thirty (30) days.

5. If a tariffs cannot be agreed in accordance with paragraph 2 of this Article, or if, during the period applicable in accordance with paragraph 4 of this Article, one aeronautical authority gives the other aeronautical authority notice of its disapproval of a tariff agreed in accordance with the provisions of paragraph 2 of the aeronautical authorities of the two Contracting Parties shall endeavour to determine the tariffs by mutual agreement.

6. If the aeronautical authorities cannot agree on any tariff submitted to them under paragraph 3 of this Article, or on the determination of any tariff under paragraph 5 of this Article, the dispute shall be settled in accordance with the provision of Article XXIII of this Agreement.

7. (a) No tariff shall come into force if the aeronautical authorities of either Contracting Party are dissatisfied with it except under the provisions of Article XXI of this Agreement.

(b) When tariffs have been established in accordance with the provisions of this Article, those tariffs shall remain in force until new tariffs have been established in accordance with the provisions of this Article or Article XXI of this Agreement.

8. If the aeronautical authorities of one of the Contracting Parties becomes dissatisfied with or wishes to review an established tariff they shall notify the aeronautical authorities of the other Contracting Party and the designated airlines shall attempt to reach an agreement. Should the designated airlines fail to agree, the procedures as set out in paragraph 5 and 6 of this Article shall apply.

9. The aeronautical authorities of both Contracting Parties shall endeavour to ensure that (A) the tariffs charged and collected conform to the tariffs accepted by both aeronautical authorities and (B) no airline rebates any portion of such tariffs by any means.

10. The tariffs of the designated airline or airlines of one Contracting Party for carriage between the territory of the other Contracting Party and points on the agreed services in third countries can, for the same class of service, match but shall not be lower or their conditions less restrictive than the tariffs of the designated airline or airlines of the other Contracting Party or of the third countries involved.

ARTICLE XV

1. The designated airline or airlines of one Contracting Party shall be allowed, on the basis of reciprocity, to maintain in the territory of the other Contracting Party their representatives and commercial, operational and technical staff as required in connection with the operation of agreed services.

2. These staff requirements may, at the option of the designated airline or airlines of one Contracting Party, be satisfied by its own personnel or by using the services of any other organization, company or airline operating in the territory of the other Contracting Party, and authorized to perform such services in the territory of that Contracting Party.

3. The representatives and staff shall be subject to the laws and regulations in force of the other Contracting Party, and consistent with such laws and regulations, each Contracting Party shall, on the basis of reciprocity and with the minimum of delay, grant the necessary employment authorizations, visitors visas or other similar documents to the representatives and staff referred to in paragraph 1 of this Article.

4. Both Contracting Parties shall dispense with the requirement of employment authorizations for personnel performing certain temporary duties not exceeding ninety (90) days.

ARTICLE XVI

Each designated airline shall have the right to engage in the sale of air transportation in the territory of the other Contracting Party directly and, at its discretion, through its agents. Each designated airline shall have the right to sell such transportation, and any person shall be free to purchase such transportation in the currency of that territory or in freely convertible currencies of other countries, subject to relevant national laws and regulations.

ARTICLE XVII

Each Contracting Party shall grant to the designated airlines of the other Contracting Party the right of transfer of excess of receipts over expenditure earned by the airlines in the territory of the First Contracting Party in connection with the carriage of passengers, mail and cargo, in accordance with the foreign exchange regulations in force under terms and conditions no less favourable than those applied to any other foreign airline operating international services to and from the territory of that Contracting Party.

ARTICLE XVIII

Income or profits from the operation of aircraft in international traffic derived by a designated airline which is resident for purposes of income taxation in the territory of one Contracting Party shall be exempt, throughout the life of this Agreement, in accordance with the provisions of the Convention between Canada and the Islamic Republic of Pakistan for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income signed at Ottawa on February 24, 1976 and particularly with reference to Article VIII thereof, provided that, if the said Convention is amended or revised at some subsequent date, taxation shall be governed by the provisions of the said convention as amended or revised, as the case may be.

ARTICLE XIX

All non-stop flights and flights with en route technical landings by air carriers of the Contracting Parties transporting passengers between the territories of the Contracting Parties, except flights chartered by a single person, company, or organization and in respect of which no charge or other financial obligation is imposed on any passenger in connection with such a charter flight, shall be smoke-free no later than July 1, 1994.

ARTICLE XX

1. The provisions set out in Articles VII, VIII, IX, X, XII, XIII, XV, XVI, XVII, XVIII, XIX, and XXI of this Agreement shall be applicable also to charter flights operated by an air carrier of one Contracting Party into or from the territory of the other Contracting Party and to the air carrier operating such flights.

2. The provision of paragraph 1 of this Article shall be subject to the national laws and regulations governing the right of air carriers to operate charter flights or the conduct of air carriers or other parties involved in the organizations of such operations.

ARTICLE XXI

1. In a spirit of close co-operation, the aeronautical authorities of the Contracting Parties shall consult each other from time to time with a view to ensuring the implementation of, and satisfactory compliance with, the provisions of this Agreement.

2. Such consultations shall begin within a period of sixty (60) days of the date of receipt of such a request, unless otherwise agreed by the Contracting Parties.

ARTICLE XXII

If either of the Contracting Parties considers it desirable to modify any provision of this Agreement, it may request consultations with the other Contracting Party. Such consultations, which may be between aeronautical authorities and which may be through discussion or by correspondence, shall begin within a period of sixty (60) days from the date of the request. Any modification agreed pursuant to such consultations shall come into force when it has been confirmed by an exchange of diplomatic notes.

ARTICLE XXIII

1. If any dispute arises between the Contracting Parties relating to the interpretation or application of this Agreement, the Contracting Parties shall in the first place endeavour to settle it by negotiation.

2. If the Contracting Parties fail to reach a settlement by negotiation, they may agree to refer the dispute for decision to some person or body, or either Contracting Party may submit the dispute for decision to a Tribunal of three arbitrators, one to be nominated by each Contracting Party and the third to be appointed by the two arbitrators. Each of the Contracting Parties shall nominate an arbitrator within a period of sixty (60) days from the date of receipt by either Contracting Party from the other of a notice through diplomatic channels requesting arbitration of the dispute and the third arbitrator shall be appointed within a further period of sixty (60) days. If either of the Contracting Parties fails to nominate an arbitrator within the period specified, or if the third arbitrator is not appointed within the period specified, the President of the Council of the International Civil Aviation Organization may be requested by either Contracting Party to appoint an arbitrator or arbitrators as the case requires. In all cases the third arbitrator shall be a national of a third State, shall act as President of the Tribunal and shall determine the place where arbitration will be held.

3. The Contracting Parties undertake to comply with any decision given under paragraph 2 of this Article.

4. The expenses of the Tribunal shall be shared equally between the Contracting Parties.

5. If and so long as either Contracting Party fails to comply with any decision given under paragraph 2 of this Article, the other Contracting Party may limit, withhold or revoke any rights or privileges which it has granted by virtue of this Agreement to the Contracting Party in default or to the designated airline in default.

ARTICLE XXIV

Either Contracting Party may at any time from the entry into force of this Agreement give notice in writing through diplomatic channels to the other Contracting Party of its decision to terminate this Agreement; such notice shall be communicated simultaneously to the International Civil Aviation Organization. The Agreement shall terminate one (1) year after the date of receipt of the notice by the other Contracting Party, unless the notice to terminate is withdrawn by mutual consent before the expiry of this period. In the absence of acknowledgment of receipt by the other Contracting Party, the notice shall be deemed to have been received fourteen (14) days after the receipt of the notice by the International Civil Aviation Organization.

ARTICLE XXV

This Agreement and any amendment thereto shall be registered with the International Civil Aviation Organization.

ARTICLE XXVI

If a general multilateral air convention comes into force in respect of both Contracting Parties, the provisions of such convention shall prevail. Consultations in accordance with Article XXII of this Agreement may be held with a view to determining the extent to which this Agreement is affected by the provisions of the multilateral convention.

ARTICLE XXVII

This Agreement shall enter into force on the date of signature.

IN WITNESS WHEREOF, the undersigned, duly authorized thereto by their respective Governments, have signed the present Agreement.

DONE in duplicate at Islamabad on this 15th day of January, 1996, in the English and French Languages, each version being equally authentic.

Roy MacLaren

GOVERNMENT OF CANADA

Aftab Shahban Mirani

GOVERNMENT OF THE ISLAMIC REPUBLIC OF PAKISTAN

ANNEXURE

(Schedule of Routes)

Section I

1. The following route may be operated by the airline or airlines designated by the Government of the Islamic Republic of Pakistan:

Agreed Route:

2. Any point or points in the above columns may be omitted provided that flights originate or terminate in Pakistan.

Section II

1. The following route may be operated by the airline or airlines designated by the Government of Canada

Agreed Route:

2. Any point or points in the above columns may be omitted provided that flights originate or terminate in Canada.