Air Canada Law Branch International and Regulatory Affairs

1. LAWDEPARTMENT AFFAIRES JURIDIQUES Air Canada Law Branch International and Regulatory Affairs An overview Presented to: IASL, McGill University By: Martine De Serres Counsel, Regulatory and International March 16, 2009

2. Law Branch – Internal Structure • Commercial (5 lawyers) • Aircraft Financing (3 lawyers) • Labour & Employment (4 lawyers) • Privacy & Human Rights (1 lawyer + 1 paralegal) • Litigation (2 lawyers + 2 paralegals) • Regulatory and International (2 lawyers) • + VP & General Counsel

3. Law Branch Tasks – International & RegulatoryGeneral Guidance • Legal advice on applicable legislation in the countries we serve • Obtain and understand applicable legislation • Coordinate with external counsel, if needed • Ensure compliance by working with various client groups • Legal advice on acceptable practices based on: • International conventions • IATA regulations • Canadian law • Prior advice from external counsel • In-house seminars • Competition Law worldwide: key principles, Dos and Don’ts • Misleading Advertising: Dos and Don’ts • Environmental Due Diligence: Canadian legal regime

4. Law Branch – International & Regulatory – TasksLicencing Requirements and Authorities • Canadian and Foreign authority licencing requirements, seasonal renewals and/or notifications • Application and schedule of operations • Insurance • Various documents (AOC; CofR; CofA; Incorporation; Manuals; …) • Required for: • Own scheduled operations • Charter operations • Wet lease operations • Code share operations • Extra sections • Subject to various conditions and requirements

5. Law Branch – International & Regulatory – TasksContractual Support • Draft, negotiate, review, and give advice on contracts: • Slot Exchange/Loan/Lease Agreements • Code share agreements • Wet lease agreements • Capacity purchase agreements • Joint ventures • Ground Handling Agreements • Tariffs

6. Recent developments – Passenger Rights • EU regulation (delays and cancellation) + all-inclusive pricing • US Denied Boarding revised rule • Australia – new all-inclusive pricing • Brazil – call centers and 12 point-font legislation • Canada – Flight Rights Canada & the new private bill • Passengers with a disability… next slide

7. Recent developments - Accessibility • US Part 382 now applies to foreign carriers • EU legislation • On-going Canadian case law • 1P1F • Oxygen decision • Service animals

8. Canadian Transportation Agency’s Jurisdiction • Air • Marine • Rail • Accessible transportation • No undue obstacle to mobility • Acceptance of determination of self-reliance • Equivalent to human rights legislation

9. Deregulation in Canada • Domestic travel deregulated • Exceptions: • 120 days prior notice for discontinuance / reduced service • Unreasonable fares if only carrier on domestic route (review upon complaint) • Unreasonable terms and conditions (review upon complaint) • International & Transborder travel still regulated– review on own-motion

10. Is the aviation industry deregulated? • Is power to review upon complaint real deregulation? • International travel still “regulated” in Canada • Regulation of fares and fees mostly deregulated world-wide • Countries have differing scales of regulations • Increased passenger rights regulations world-wide • => A new trend for regulation?

11. Inherent International Regulatory Conflicts • Regulating code share relationships: • Operating carrier rule vs. marketing carrier rule • Competition law: managing cultural and legislative differences • Consumer protection: increasing in number, variety and scope • Lack of uniformity - Apply the highest standard

12. Questions? • Thank you!