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der iscribe only a just and reasonable maximum or minimum, or maximum and der eine minimum rate, fare, or charge."

SEC. 4. Subsection (e) of section 1002 of the Federal Aviation Act of 1958 (49 led day U.S.C. 1482(e)) is amended by inserting the words “and foreign air carriers" jie sa im after the words "air carriers” where they appear in paragraphs (2) and (3)

of the subsection, and by inserting the words “and foreign air carrier" after Faden du. the words “air carrier” where they appear in paragraph (5).

Sec. 5. Subsection (f) of section 1002 of the Federal Aviation Act of 1958 pateren (49 U.S.C. 1482(f)) is amended to read as follows:

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"RATES AND PRACTICES IN FOREIGN AIR TRANSPORTATION "(f) Whenever, after notice and hearing, upon complaint or upon its own intoy itiative, the Board shall be of the opinion that any individual or joint rate, fare,

or charge demanded, charged, collected, or received by any air carrier or foreign air carrier for foreign air transportation, or any classification, rule, regulation,

or practice affecting such rate, fare, or charge or the value of the service sig for thereunder, is or will be unjust or unreasonable or unjustly discriminatory, or

unduly preferential, or unduly prejudicial, the Board may alter the same to the extent necessary to correct such unjustness, unreasonableness, discrimination, preference, or prejudice and make an order that the air carrier or foreign air carrief shall discontinue demanding, changing, collecting, or receiving any such unjust, unreasonable, discriminatory, preferential, or prejudicial rate, fare, or charge, or enforcing any such unjust, unreasonable, discriminatory, preferential or prejudicial, classification, rule, regulation, or practice. The Board may in the aforesaid order set forth and prescribe the lawful rate, fare, or charge (or the maximum or minimum or the maximum and minimum thereof)

thereafter to be demanded, charged, collected, or received, or the lawful classiy los fication, rule, regulation, or practice thereafter to be made effective."

Sec. 6. Subsection (g) of section 1002 of the Federal Aviation Act of 1958 (49 U.S.C. 1482(g)) is amended

(1) by striking out the words "interstate or overseas”;

(2) by amending the parenthetical phrase following the word "joint” to read as follows: “(between air carriers, between foreign air carriers, or between an air carrier or carriers and a foreign air carrier or carriers)"; and

(3) by inserting the words "or foreign air carrier" after the words "air carrier” wherever they appear therein. Sec. 7. Subsection (i) of section 1002 of the Federal Aviation Act of 1958 (49 U.S.C. 1482(i)) is amended by changing the colon following the word "operated” to a period and striking out the following: "Provided, That as to joint rates, fares, and charges for overseas transportation the Board shall determine and prescribe only just and reasonable maximum or minimum or maximum and minimum joint rates, fares, or charges.

SEC. 8. The ai ments made by this Act shall become effective thirty days after the date of enactment of the Act.

Passed the Senate November 26, 1963.
Attest:

FELTON M. JOHNSTON, Secretary.

EXECUTIVE OFFICE OF THE PRESIDENT,

BUREAU OF THE BUDGET,

Washington, D.C., May 23, 1963.
Hon. OBEN HARRIS,
Chairman, Committee on Interstate and Foreign Commerce,
House of Representatives, Washington, D.C.

DEAR MR. CHAIRMAN: This is in reply to your letter of February 20, 1963, requesting the views of the Bureau of the Budget on H.R. 1716, a bill to amend section 1002 of the Federal Aviation Act to authorize the Civil Aeronautics Board to suspend certain rates relating to foreign air transportation, and for other purposes.

The Bureau of the Budget strongly supports the objective of this bill but believes it to be seriously inadequate to achieve this objective, i.e., to create in the Government of the United States equal powers over the rates and practices of air carriers and foreign air carriers operating between the territory of the

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United States and foreign countries as foreign governments have over the rates and practices of U.S. air carriers flying between the United States and their territories. H.R. 1716 would not appear to give the Civil Aeronautics Board more than suspension powers for a period of 365 days; any rates desired bf for eign carriers could be put into effect at the end of the suspension period without remedy for the Board.

The Bureau of the Budget greatly prefers a Civil Aeronautics Board draft
bill to amend the Federal Aviation Act of 1958 to provide for the regulation of
rates and practices of air carriers and foreign air carriers in foreign air trans-
portation, and for other purposes, which the President transmitted to the Con
gress by letter of May 14, 1963.
Sincerely yours,

PHILLIP S. HUGHES,
Assistant Director for Legislative Reference.

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CIVIL AERONAUTICS BOARD,

Washington, D.C., April 28, 1961
Hon. OREN HARRIS,
Chairman, Committee on Interstate and Foreign Commerce, House of Repre.

scntatives, Washington, D.C.
DEAR MR. CHAIRMAN : This is in further reply to your letter of February 3.
1963. requesting a report by the Board on H.R. 1716, a bill to amend section
1002 of the Federal Aviation Act of 1958 to authorize the Civil Aeronautics Board
to suspend certain rates relating to foreign air transportation, and for other
purposes.

H.R. 1716 would empower the Board to suspend tariffs of air carriers and foreign air carriers engaged in foreign air transportation, while H.R. 640, which is also pending before your committee, would not only authorize the Board to suspend tariffs but also to regulate the rates and practices of such carriers.

The Board pointed out to your committee in a letter dated May 29, 1993 that the provisions of H.R. 6400 were identical to those of a draft bill submitted by the President to the Congress on May 14, 1963, and urged that prompt and favorable consideration be given to such bill for the reasons set forth in the "Statement of Purpose and Need" accompanying the draft legislation. The Board repeated its endorsement of H.R. 6400 in a letter to your committee dated March 30, 1964, urging that prompt and favorable consideration be giren to such bill rather than to S. 1540, a similar bill.

In view of the foregoing, the Board is opposed to the enactment of HR. 1716, and again urges that prompt and favorable consideration be given to H.R. 6400

The Board has been advised by the Bureau of the Budget that there is no objection to the submission of this report from the standpoint of the administration's program. For the Civil Aeronautics Board :

HAROLD R. SANDERSON, Secretary.

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CIVIL, AERONAUTICS BOARD,

Washington, D.C., May 29, 1963.
Hon. OREN HARRIS,
Chairman, Committee on Interstate and Foreign Commerce, House of Repre-

sentatives, Washington, D.C.
DEAR MR. CHAIRMAN. This is in reply to your letter of May 23, 1963, requesting
a report by the Board on H.R. 6400, a bill to amend the Federal Aviation Act
of 1958 to provide for the regulation of rates and practices of air carriers and
foreign air carriers in foreign air transportation, and for other purposes.

The provisions of H.R. 6400 are identical to those of a draft bill submitted by the President to Congress on May 14, 1963.

For the reasons set forth in the “Statement of Purpose and Need" which accompanied the draft bill, a copy of which is enclosed, the Board urges that prompt and favorable consideration be given to H.R. 6400. Sincerely yours,

ALAN S. BOYD, Chairman.

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COMPTROLLER GENERAL OF THE UNITED STATES,

Washington, June 25, 1963. fe Hon. OREN HARRIS, Chairman, Committee on Interstate and Foreign Commerce, House of Repre

sentatives, Washington, D.C. DEAR MR. CHAIRMAN : We again refer to your letter of May 23, 1963, in which you ask for our comments on H.R. 6400.

This bill is designed to amend the Federal Aviation Act of 1958, 49 U.S.C. 1301, et seq., to give the Civil Aeronautics Board more power and control than it now possesses over foreign air transportation. Under the present law, the Civil Aeronautics Board has practically no direct authority over the rates and

practices of either United States or foreign air carriers engaged in foreign air Pazi transportation. The only power as to the adjustment of rates and practices in

foreign air transportation now possessed by the Board (apart from its power to disapprove agreements among air carriers and foreign air carriers fixing rates

and practices in foreign air transportation) is that of ordering a carrier to re17 move a discrimination in its rate structure if, after notice and hearing, such a

discrimination is found to exist (49 U.S.C. 1482(f)).

If enacted, H.R. 6400 would not affect the functions and activities of the Genegre i eral Accounting Office. Its provisions generally seem to be in the public interest

and we are not opposed to enactment.

The need for some type of legislative control has been emphasized by the publicity given to a recent proposal of the International Air Transport Association, an international organization of 90 airlines that set fares and rates for most of the world's international air routes, to increase fares on the North Atlantic routes. The United States found it necessary to agree to the proposal. We note that the provisions of H.R. 6400 accord with a statement of U.S. international air transport policy, recently approved by the President after submission to him by an Interagency Steering Committee, and that the bill would serve to implement paragraph II (j) of the annex to the Agreement Between the Government of the United States of America and the Government of the United Kingdom Relating to Air Services Between Their Respective Territories, commonly called the Bermuda Agreement (60 Stat. 1499, 1506 (1946)). Sincerely yours,

JOSEPH CAMPBELL, Comptroller General of the United States.

EXECUTIVE OFFICE OF THE PRESIDENT,

BUREAU OF THE BUDGET,

Washington, D.C., June 27, 1963.
Hon. OREN HARRIS,
Chairman, Committee on Interstate and Foreign Commerce,
House of Representatives, Washington, D.C.

DEAR MR. CHAIRMAN : This is to acknowledge and reply to your letter of May 23, 1963, requesting the views of the Bureau of the Budget on H.R. 6400, a bill to amend the Federal Aviation Act of 1958 to provide for the regulation of rates and practices of air carriers and foreign air carriers in foreign air transportation, and for other purposes.

While the immediate problem of the breakdown of the system of rate negotiations developed by the International Air Transport Association lends urgency to this proposal, there is a longstanding underlying need to place the U.S. Government, through the Civil Aeronautics Board, in a position more nearly equal to that of foreign governments with respect to the control of international air rates. Virtually all important international air carrier nations, except the United States, assert this power. At the present time, however, the powers of the CAB over the rates and practices of both U.S. carriers in foreign air transportation and foreign air carriers is limited to removing discriminatory or prejudicial rates found to exist after notice and hearing.

In keeping with the Administration's international air policies, this Government, in the interests of U.S. citizens who travel abroad by air and U.S. businessmen shipping goods by air in international commerce, should maintain continuous surveillance of international air rates and should press for the lowest rates consistent with reasonable profits for U.S.-flag carriers who are believed to be the most efficient.

The proposed bill would give the Board authority to prescribe rates an practices and to suspend tariffs, but these powers would be exercised consis ently with the provisions of our international agreements, as provided by sectiu 1102 of the Federal Aviation Act, and would be subject to the approval of the President to assure consistency with the general foreign policy and securit objectives of the U.S. Government.

The Bureau of the Budget strongly recommends enactment of H.R. 6400 and advises that it would be in accord with the program of the President. Sincerely yours,

PHILLIP S. HUGHES,
Assistant Director for Legislative Reference.

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U.S. DEPARTMENT OF JUSTICE,
OFFICE OF THE DEPUTY ATTORNEY GENERAL,

Washington, D.C., May 5, 1964
Hon. OREN HARRIS,
Chairman, Committee on Interstate and Foreign Commerce,
House of Representatives, Washington, D.C.

DEAR MR. CHAIRMAN: This is in response to your request for the views of the Department of Justice on H.R. 6100, a bill to amend the Federal Ariation Act of 1958 to provide for the regulation of rates and practices of air carriers and foreign air carriers in foreign air transportation, and for other purposes.

The bill would amend the Federal Aviation Act of 1958 to give the Cirl Aeronautics Board discretionary authority, subject to Presidential approval

, to prescribe rates and practices and to suspend tariffs in international air transportation to and from the United States under the same standards now appli

. cable to interstate transportation. The bill embodies the recommendations of an interdepartmental committee and was transmitted to the Congress by Presi. dent Kennedy on May 14, 1963.

On November 26, 1963, the Senate passed S. 1540, companion bill to H.R. 640, and S. 1540 is likewise with the House Committee on Interstate and Foreign Commerce. As S. 1540 passed the Senate, it differs from H.R. 6400 in only one respect. Whereas H.R. 6400 requires Presidential approval of Board orders or actions relative to foreign air transportation, S. 1540 merely requires that Board orders or actions be reported to the President prior to publication,

Whether or not this legislation should be enacted involves policy considera. tions concerning which the Department of Justice makes no recommendation. Howerer, the Bureau of the Budget has advised that although there is no objection to the submission of this report, the enactment of H.R. 6400 would be in accord with the program of the President. Sincerely yours,

NICHOLAS DEB, KATZENDACH,

Deputy Attorney General.

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DEPARTMENT OF STATE,

Washington, July 26, 1963.
Hon. OREN HARRIS,
Chairman. Committee on Interstate and Foreign Commerce,
House of Representatives, Washington, D.C.

DEAR MR. CHAIRMAN: In your letter of May 23, 1963, you requested the De partment's view on H.R. 6400, a bill to amend the Federal Aviation Act of 1958 to provide for the regulation of rates and practices of air carriers in foreign air transportation, and for other purposes. The Department strongly supports enactment of this legislation.

Passage of the hill would achieve two objectives. By giving the Civil Aero nautics Board anthority to fix rates in international air transportation, H.R. 6400 would greatly improve the position of the United States in the bilateral agreements it has with more than 40 countries. Moreover, if the Civil Aeronatics Board has clear ratemaking authority over international air transportation, the United States will go with a far stronger hand into any intergovernmental conference on rates that may come out of the present situation.

Since the subject of this legislation is primarily within the furisdiction of the Civil Aeronautics Board, this statement is directed primarily to those aspects of

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the bill which bear upon the series of bilateral air agreements to which the United States is a party. Specifically, this statement is directed to the question of how the legislation would affect the position of the United States under the alternative rate articles in our present "Bermuda type” bilateral air services agreements. In presenting this detailed analysis, however, we wish to emphasize the effect upon our existing bilateral is not the only aim of the bill. We believe that passage of H.R. 6400 would make it possible for the United States to work far more effectively than at present for our position that international air fares should be lowered and not raised.

We shall use as examples of the two alternative rate provisions article II (e) E and II(f) of the annex to the Bilateral Air Agreement between the United States * kasi and the United Kingdom. Both articles provide for the submission of proposed

rates by the carriers of one country to the aeronautical authorities of the other, and provide for a 30-day period in which notice of dissatisfaction may be given and consultations may be held.

At the present time, because the CAB has no ratemaking authority over interpational air services, the article which is now in force is II (f). It provides, ini substance, that if no agreement has been reached on the proposed rate at the end of 30 days, the country objecting to the proposed rate "may take such steps as it may consider necessary to prevent the inauguration or continuation

of the service in question at the rate complained of.” On the other hand, under AT ME" the alternative article II (e), which would be applicable if H.R. 6400 were z enacted, a proposed rate goes into effect provisionally, unless the aeronautical

authorities of the country whose flag carrier proposed the rate agrees to sus1 personpend its operation.

The critical factor in determining which of the two alternative rate articles Paso applies is whether "power is conferred by law upon the aeronautical authorities

of the United States to fix fair and economic rates for the transport of persons

and property by air on international services and to suspend proposed rates in to a manner comparable to that in which the Civil Aeronautics Board at present

is empowered to act with respect to such rates for the transport of persons and

property by air within the United States * * *." In the Department's view, H.R. namesto 6400 meets this criterion in every relevant respect.

Section 4 of the hill would amend section 1002(e) of the Federal Aviation Act of 1958 which sets forth the criteria to be applied by the Board in determination of rates. By inserting the words “foreign air carriers" at each point in the present section 1002(e) where only the words "air carriers" now appear, the bill would make precisely the same criteria applicable with respect to rates in international air transportation as are presently applicable with respect to rates in air transportation within the United States. This is made clear by the definition of “foreign air carriers" which appears in section 101 (19) of the present act, and the definition of "foreign air transportation" which appears in section 101 (21).

Section 5 of the bill would amend section 1002(f) of the Federal Aviation Act, which sets forth the powers of the Civil Aeronautics Board with respect to rates in international air transportation. Under the present section 1002(f), the only authority vested in the Board over rates in international air transportation relates to removal of unjustly discriminatory, or unduly preferential, or unduly prejudicial rates or practices. This authority is clearly not comparable to that vested in the Board by section 1002(d) with respect to rates in domestic air transportation. The proposed amendment would add to the CAB's present authority over existing rates definite power to review and disapprove "unjust" or "unreasonable" rates. The Board's authority would be to alter, set forth, and prescribe the lawful rate, after notice and hearing, upon complaint or upon its own initiative.

Section 6 of the bill would amend section 10021g) of the Federal Aviation Act, which sets forth the authority of the Board with respect to suspension of proposed rates. By striking the words "interstate or overseas" qualifying the words "air transportation," and by adding the words "or foreign air carriers" wherever they appear in the present section, the bill would give the CAB precisely the same power to suspend rates in international air transportation as it now has with respect to rates proposed by U.S. air carriers for transportation within the United States. This authority would be to suspend new rates, according to the criteria set forth in section 1002(e), for a period of up to 90 days, which may be extended to an aggregate of up to 180 days.

Thus, in all relevant respects the bill would accomplish the purpose of bringing into force the preferable rate article_article II (e) of the annex to the

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