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Exchange of Notes constituting an Agreement to amend the Air Transport Agreement between Canada and the Swiss Confederation, done at Ottawa on 20 February 1975 [2006] CATSer 7 (17 May 2006)

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EXCHANGE OF NOTES CONSTITUTING AN AGREEMENT TO AMEND THE AIR TRANSPORT AGREEMENT BETWEEN CANADA AND THE SWISS CONFEDERATION, DONE AT OTTAWA ON 20 FEBRUARY 1975

I

The Ambassador of Canada to the Federal Councillor of the Swiss Confederation

Bern, June 1st, 2005

Letter N^o 025

Madam Micheline Calmy-Rey
Federal Councillor
Head of the Federal Department of Foreign Affairs of the Swiss Confederation
Parliament Building West
Bern, Switzerland

Madam,

I have the honour to refer to the Agreement between Canada and the Swiss Confederation on Air Transport signed at Ottawa on February 20, 1975, hereinafter referred to as “the Agreement”, the related Exchange of Notes of the same date and to consultations between representatives of our two Governments held in Ottawa February 8-9, 1996, and in Bern October 17-18, 2002.

I have the further honour to propose, on behalf of the Government of Canada, that the Agreement be amended as follows:

1. Paragraph a) of Article I (Definitions) of the Agreement is superseded and replaced by the following:

(a) “Aeronautical authorities" means, in the case of Canada, the Minister of Transport and the Canadian Transportation Agency and, in the case of Switzerland, the Federal Office for Civil Aviation or, in both cases, any other authority or person empowered to perform the functions exercised by the said authorities;

2. Article II of the Agreement is superseded in its entirety and the following is substituted therefor:

ARTICLE II

(Grant of Rights)

1. Each Contracting Party grants to the other Contracting Party the following rights for the conduct of international air services by the airline or airlines designated by that other Contracting Party:

(a) the right to fly without landing across its territory;

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

(c) except as otherwise determined in this Agreement, the right to make stops in its territory on the routes specified in this Agreement for the purpose of taking up and discharging international traffic in passengers and cargo, including mail, separately or in combination.

2. The airlines of each Contracting Party operating scheduled services, other than those designated under Article III of this Agreement, shall also enjoy the rights specified in paragraph 1(a) and (b) of this Article.

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

3. Paragraph 1 of Article III is superseded and replaced by the following:

ARTICLE III

(Designation)

1. 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 this Agreement for that Contracting Party and to withdraw a designation or to substitute another airline for one previously designated.

4. Article V of the Agreement is superseded in its entirety and the following is substituted therefor:

ARTICLE V

(Capacity)

1. The designated airlines shall enjoy fair and equal opportunities to operate the agreed services between the territories of the Contracting Parties.

2. The designated airline of each Contracting Party shall take into consideration the interests of the designated airline of the other Contracting Party so as not to affect unduly the agreed services of the latter airline.

3. The main objective of the agreed services shall be to provide capacity corresponding to traffic demands between the territory of the Contracting Party which has designated the airline and the points served on the specified routes.

4. The right of each of the designated airlines to carry international traffic between the territory of the other Contracting Party and the territories of third countries, shall be exercised in conformity with the general principles of normal development to which both Contracting Parties subscribe and subject to the condition that the capacity shall be adapted:

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

(b) to traffic demands of the areas through which the services passes, local and regional services being taken into account;

(c) to the requirements of through airline operations.

5. Except as otherwise specified, neither Contracting Party may unilaterally impose any restrictions on the designated airline of the other Contracting Party with respect to capacity, frequency or type of aircraft employed in connection with services over any of the routes specified in the Annex attached to this Agreement. In the event that one of the Contracting Party believes that the operation proposed or conducted by the designated airline of the other Contracting Party unduly affects the agreed services provided by its designated airline, it may request consultations pursuant to Article XIV of this Agreement.

5. Article VI of the Agreement is superseded in its entirety and the following is substituted therefor:

ARTICLE VI

(Application of Laws)

1. The laws, regulations and procedures of one Contracting Party relating to the admission to 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, sojourn, exit, clearance transit, emigration and immigration, passports, customs and quarantine shall be complied with by the designated airline or airlines of the other Contracting Party and its crews, passengers, cargo and mail upon transit of, admission to, departure from and while within the territory of such a Contracting Party.

3. Passengers, baggage and cargo in transit across the territory of one Contracting Party and not leaving the area of the airport reserved for such purpose shall only be subject to a very simplified control. Baggage and cargo in direct transit shall be exempt from customs duties and other similar taxes.

4. Neither of the Contracting Parties shall give a preference to its own or any other airline over the airline or airlines of the other Contracting Party engaged in similar international air services in the application of the laws and regulations provided for by this Article.

6. Article VII of the Agreement is superseded in its entirety and the following is substituted therefor:

ARTICLE VII

(Safety Standards, Certificates and Licences)

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 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, 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 consultations in accordance with Article XIV of this Agreement with the aeronautical authorities of that Contracting Party with a view to clarifying the practice in question.

3. Each Contracting Party may request consultations concerning the safety standards maintained by the other Contracting Party relating to aeronautical facilities, aircrew, aircraft, and operation of the designated airlines. If following such consultations, one Contracting Party finds that the other Contracting Party does not effectively maintain and administer safety standards and requirements in these areas that at least equal the minimum standards which may be established pursuant to the Convention, the other Contracting Party shall be notified of such findings and the steps considered necessary to conform with these minimum standards, and shall take appropriate corrective action. In the event the other Contracting Party does not take such appropriate action within a reasonable time, the provisions of Article IV shall apply.

7. Article VIII of the Agreement is superseded in its entirety and the following is substituted therefor:

ARTICLE VIII

(Use of Airports and Aviation Facilities)

1. Airports, airways, air traffic control and air navigation services, aviation security, and other related facilities and services that are available in the territory of one Contracting Party shall be provided without preference to any airline over an airline of the other Contracting Party engaged in similar international air services.

2. The setting and collection of fees and charges imposed in the territory of one Contracting Party on an airline of the other Contracting Party for the use of airports, airways, air traffic control and air navigation services, aviation security, and other related facilities and services shall be just, reasonable and not unjustly discriminatory. Any such fees and charges shall be assessed on an airline of the other Contracting Party on terms not less favourable than the most favourable terms available to any airline engaged in similar international air services at the time the fees or charges are imposed.

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

8. Article XI of the Agreement is superseded in its entirety and the following is substituted therefor:

ARTICLE XI

(Tariffs)

1. The tariffs for carriage on agreed services to and from the territory of the other Contracting Party shall be established by the designated airlines on the basis of market forces, due regard being paid to all relevant factors including cost of operation, characteristics of service, reasonable profit, the tariffs of other designated airlines and other commercial considerations in the marketplace.

2. The tariffs referred to in paragraph 1 of this Article may be established individually or, at the option of the designated airline or airlines, through coordination with each other or with other airlines. Each designated airline shall be responsible only to its own aeronautical authorities for economic justification of its tariffs.

3. Tariffs shall be filed, where required, with the aeronautical authorities of both Contracting Parties and received by those authorities at least one (1) day before the proposed effective date. The aeronautical authorities of both Contracting Parties shall give prompt and sympathetic consideration to applications for short notice filing especially if intended for matching a tariff that has been filed, or for introducing tariff changes resulting from circumstances beyond the control of the designated airline or airlines. A designated airline which has established a tariff individually shall, at the time of filing, provide to the designated airline or airlines of the other Contracting Party, a copy of the tariff filed.

4. Designated airlines shall be permitted to sell transportation on the agreed services in accordance with proposed tariffs upon filing provided that all sales are for transportation commencing not earlier than the proposed effective date and the tariffs clearly indicate that the tariffs are subject to government approval.

5. If the aeronautical authorities of one Contracting Party are dissatisfied with a proposed tariff, they shall notify the aeronautical authorities of the other Contracting Party and the designated airline concerned within ten (10) days from the date of receipt of the proposed tariff. In the event that a shorter period for the filing of a tariff is accepted by the aeronautical authorities, they may also agree that the period for giving notice of dissatisfaction be less than ten (10) days.

6. If the aeronautical authorities of one Contracting Party become dissatisfied with a tariff in effect, they shall notify the aeronautical authorities of the other Contracting Party and the designated airline concerned.

7. If a notice of dissatisfaction has been issued pursuant to paragraph 5 or 6 of this Article, the aeronautical authorities receiving the notice of dissatisfaction shall acknowledge the notice, including an indication of their agreement or disagreement with it, within ten (10) days of receipt of the notice. Communication pursuant to this Article may be done by means of a letter or any type of electronic communication which produces printed text.

8. No tariff shall come into effect or remain in effect if:

(a) it applies to carriage between the territories of the Contracting Parties and the aeronautical authorities of both Contracting Parties are dissatisfied with it; or

(b) it applies to carriage between the territory of the other Contracting Party and a third country, and the aeronautical authorities of that Contracting Party are dissatisfied with it.

9. The designated airline or airlines of each Contracting Party shall have the right to match, on a timely basis, any publicly available lawful tariff on scheduled services for carriage between the territories of both Contracting Parties, on a basis which would not necessarily be identical but broadly equivalent in terms of routing, aircraft type, applicable conditions and standard of service. Similarly, the designated airline or airlines of each Contracting Party shall have the right to match, on a timely basis, a tariff for carriage between the territory of the other Contracting Party and any third country, provided that the resulting tariff does not undercut the tariffs of the third- and fourth-freedom airlines in that market.

10. 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. Nevertheless, a tariff shall not be prolonged by virtue of this paragraph for more than twelve (12) months after the date on which it would otherwise have expired.

11. The aeronautical authorities of either Contracting Party may request consultations on tariffs at any time. Such consultations, which may be conducted orally or in writing, shall be held within fifteen (15) days of receipt of the request, unless otherwise agreed between the aeronautical authorities.

12. The aeronautical authorities of both Contracting Parties shall endeavour to ensure that the tariffs charged and collected conform to the tariffs lawfully in force.

9. Article XIII of the Agreement is superseded in its entirety and the following is substituted therefor:

ARTICLE XIII

(Taxation)

The Contracting Parties shall act in accordance with the relevant provisions of the Convention between Canada and Switzerland for the Avoidance of Double Taxation with respect to Taxes on Income and on Capital signed at Bern on August 20, 1976, and any subsequent Conventions or amendments thereto, in respect of the operation of aircraft in international traffic.

10. The following two new articles are added to the Agreement, bearing the article numbers shown:

ARTICLE VI bis

(Aviation Security)

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, the Convention for the Suppression of Unlawful Acts Against the Safety of Civil Aviation, signed at Montreal on September 23, 1971, and the Protocol for the Suppression of Unlawful Acts of Violence at Airports Serving International Civil Aviation, signed at Montreal on 24 February 1988 and any other multilateral agreement governing aviation security binding upon both Contracting Parties.

3. The Contracting Parties shall provide upon request all necessary 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. 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.

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

ARTICLE XIX bis

(Applicability to Non-Scheduled Flights)

1. The provisions set out in Article VI (Application of Laws), VII (Safety Standards, Certificates and Licences), Article VI bis (Aviation Security), VIII (Use of Airports and Aviation Facilities), IX (Statistics), X (Customs Duties and Other Charges), XII (Sales and Transfer of Funds, Airline Representatives), XIII (Taxation), and XIV (Consultations) of this Agreement shall be applicable also to non-scheduled 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 provisions of paragraph 1 of this Article shall not affect national laws and regulations governing the authorization of non-scheduled operations or the conduct of air carriers or other parties involved in the organization of such operations.

ROUTE SCHEDULE

SECTION I

The following route may be operated in either or both directions by an airline(s) designated by the Government of Switzerland:

Notes:

1. Any Intermediate Points and/or Points Beyond may be omitted on any or all services, provided that all services originate or terminate in Switzerland. Points in Canada may be served separately or in combination.

2. Only transit and own stopover rights shall be available at Intermediate Points and at Points in Canada. Stopover rights shall not be available between Points in Canada. The designated airline(s) of Switzerland may, at any point on the specified routes and at is option, transfer traffic between its aircraft without any limitation as to type or number of aircraft, provided that, in the outbound direction, the transportation beyond such point is a continuation of the transportation from Switzerland and, in the inbound direction, the transportation to Switzerland is a continuation of the transportation from beyond such point and provided that all flights involved in the transfer originate or terminate in Switzerland.

3. Subject to the regulatory requirements normally applied to such operations by the aeronautical authorities of Canada, each designated airline of Switzerland may enter into cooperative arrangements for the purpose of:

a) holding out the agreed services on the specified routes by code-sharing (i.e. selling transportation under its own code) on flights operated by an airline(s) of Switzerland, of Canada, and/or of any third country; and /or

b) carrying traffic under the code of any other airline(s) where such other airline(s) has been authorized by the aeronautical authorities of Canada to sell transportation under its own code on flights operated by that designated airline of Switzerland.

Code sharing services involving transportation between Points in Canada shall be restricted to flights operated by an airline(s) authorized by the aeronautical authorities of Canada to provide service between Points in Canada and all transportation between Points in Canada under the code of the designated airline(s) of Switzerland shall only be available as part of an international journey.

All airlines involved in code-sharing arrangements shall hold the appropriate underlying route authority.

The aeronautical authorities of Canada shall not withhold permission for code-sharing services identified in 3 a) above by the designated airline(s) of Switzerland on the basis that the airline(s) operating the aircraft does not have the right from Canada to carry traffic under the code of the designated airline(s) of Switzerland.

SECTION II

The following route may be operated in either or both directions by an airline(s) designated by the Government of Canada:

Notes:

1. Any Intermediate Points and/or Points Beyond may be omitted on any or all services, provided that all services originate or terminate in Canada. Points in Switzerland may be served separately or in combination.

2. Transit and own stopover rights shall be available at Intermediate Points and at Points in Switzerland. Stopover rights shall not be available between Points in Switzerland. The designated airline(s) of Canada may, at any point on the specified routes and at its option, transfer traffic between its aircraft without any limitation as to type or number of aircraft, provided that, in the outbound direction, the transportation beyond such point is a continuation of the transportation from Canada and, in the inbound direction, the transportation to Canada is a continuation of the transportation from beyond such point and provided that all flights involved in the transfer originate or terminate in Canada.

3. Fifth freedom rights shall be available beyond Zurich and/or Geneva to the following points to be named by Canada: a) four points from the following countries: Poland, Hungary, Austria, Yugoslavia, b) five points in Asia, including a point or points in India; and beyond, and beyond to Canada, c) a point in Kenya and four points in Africa south of the Tropic of Cancer. Fifth freedom rights shall not be exercised to each specific point beyond simultaneously from both Zurich and Geneva.

4. Subject to the regulatory requirements normally applied to such operations by the aeronautical authorities of Switzerland, each designated airline of Canada may enter into cooperative arrangements for the purpose of:

a) holding out the agreed services on the specified routes by code-sharing (i.e. selling transportation under its own code) on flights operated by an airline(s) of Canada, of Switzerland, and/or of any third country; and /or

b) carrying traffic under the code of any other airline(s) where such other airline(s) has been authorized by the aeronautical authorities of Switzerland to sell transportation under its own code on flights operated by that designated airline of Canada.

Code sharing services involving transportation between Points in Switzerland shall be restricted to flights operated by an airline(s) authorized by the aeronautical authorities of Switzerland to provide service between Points in Switzerland and all transportation between Points in Switzerland under the code of the designated airline(s) of Canada shall only be available as part of an international journey.

All airlines involved in code-sharing arrangements shall hold the appropriate underlying route authority.

The aeronautical authorities of Switzerland shall not withhold permission for code-sharing services identified in 4 a) above by the designated airline(s) of Canada on the basis that the airline(s) operating the aircraft does not have the right from Switzerland to carry traffic under the code of the designated airline(s) of Canada.

If the foregoing is acceptable to your Government, I have the honour to propose that this Letter, the text of which is equally authentic in English and French, and your reply in confirmation thereto, shall constitute an Agreement between Canada and the Swiss Confederation to amend the Air Transport Agreement, signed at Ottawa on February 20, 1975, which shall enter into force when each Government shall have notified the other of the fulfilment of their internal procedures required for the entry into force of this Agreement, pursuant to Article XV of the Agreement. Pursuant to Article XVIII of the Agreement, Canada will register this Agreement with ICAO once it has entered into force.

Jean-Paul Hubert

II

The Federal Councillor of the Swiss Confederation to the Ambassador of Canada

(Translation)

Bern, June 13, 2005

His Excellency Jean-Paul Hubert
Ambassador of Canada
Bern

Dear Ambassador,

I refer to your letters of June 1, 2005, which are equally authentic in English and French, regarding an amendment to the February 20, 1975, Air Transport Agreement between the Swiss Confederation and Canada; the French version of these letters contain the following:

(See the letter from the Ambassador of Canada)

I have the honour to inform you that the foregoing is acceptable to the Swiss Federal Council. Consequently, your letters, along with this response, constitute an agreement modifying the February 20, 1975, Air Transport Agreement between the Swiss Confederation and Canada that will enter into force once the two governments will have notified to each other the fulfilment of their internal formalities required for the entering into force of this Agreement, in accordance with the provisions of Article XV of the Agreement.

Please accept, Excellency, the assurances of my highest consideration.

Micheline Calmy-Rey