Aviation Regulation – History and Practice – Part 2

Aviation Regulation – History and Practice

Part Two

FOREIGN AIR MAIL CONTRACTS

The airmail legislation described in Part One did not apply to air transportation of foreign mail. Eventually, with the U.S. government strongly supporting mail service between North and South America, the U.S. Congress passed the Foreign Air Mail Act of 1928 to regulate such international service. This, however, was preceded by the formation of Pan American Airways and its inauguration of international airline services between the U.S. and Cuba.

Pan American Airways, Inc. (PAA) was founded on 14 March 1927 by Air Force Majors “Hap” Arnold, Carl Spaatz and John H. Jouett, later joined by John K. Montgomery and Richard B. Bevier, as a counterbalance to German-owned carrier “SCADTA” (Colombo-German Aerial Transport Co) that had been operating in Colombia since 1920. SCADTA was viewed as a possible German aerial threat to the Panama Canal.  Eventually Montgomery petitioned the US government to call for bids on an U.S. airmail contract between Key West and Havana (FAM 4) and won the contract.  However, PAA lacked any aircraft to perform the job and did not have landing rights in Cuba.  Under the terms of the contract, PAA had to be flying by 19 October 1927.

juan-t-trippeOn 2 June 1927, Juan Trippe formed the Aviation Corporation of America (ACA) with financially powerful and politically well-connected backing, and raised $300,000.  On 1 July Reed Chambers and financier Richard Hoyt formed Southeastern Airlines.   On 8 July Trippe formed Southern Airlines and on 11 October Southeastern was reincorporated as Atlantic, Gulf and Caribbean Airways.  Trippe then proposed a merger between these three groups and in doing so played a trump card:  He and John A. Hambleton, one of his backers, traveled to Cuba and persuaded the Cuban president to grant landing rights to the Aviation Corporation, making Montgomery’s mail contract useless as a bargaining chip.  After much wrangling between the groups, including a meeting on Hoyt’s yacht during which Assistant Postmaster General Irving Grover threatened that if there was no deal he would not be awarding any contract to anyone, the Aviation Corporation of the Americas was formed, operating as Pan American Airways, headed by Juan Trippe.  Later the corporation’s name was changed to Pan American Airways.

The deadline of 19 October still loomed, however. A Fokker F-VII aircraft was selected for the operation, but could not be used becaFairchildFC-2 La Ninause Meacham’s Field in Key West was not completed and could not accommodate the aircraft. What transpired was an eleventh hour miracle. Pan American’s representative in Miami learned that a Fairchild FC-2 monoplane was in Key West, sitting out a hurricane threat.  The aircraft was owned by West Indian Aerial Express (the Fairchild Group) and a deal was made to charter the aircraft.  The pilot was offered $145.50 to carry mail to Havana that had just arrived on the Florida East Coast and Atlantic Coast Line railroads.  The hurricane threat disappeared and the trip was made.  The rest is history.

On 28 October 1927, the Fokker finally left Key West on Pan American’s inaugural international flight, carrying 772 lb. of mail.

FOKKER F7-staff

Under the Act, Foreign Airmail contracts (FAMs) were put up for bidding and Pan American was able to win them, making it the only US-flagged carrier with authority from the U.S. government to carry mail to foreign countries on international routes.  Operating authority to these countries, however, needed to be secured and at the time there was no framework within the US government to accomplish that. Pan American’s Juan Trippe was able to do it. He carried out then what the U.S. Departments of State and Transportation do today with respect to foreign routes.

Pan American established services first in the Caribbean, the whole of Latin America and eventually across the 1930s colorfulPacific Ocean. Authority across the Pacific, however, was not Trippe’s original transoceanic ambition. It was the Atlantic. However the geopolitical situation coupled with technological limitations made that option impossible. The path to Europe was through Newfoundland. Unfortunately, negotiations between Trippe, Britain, Canada and Newfoundland in 1932 did not provide the access desired, although some understanding was achieved between Pan American and Britain’s Imperial Airways with regard to traffic rights. Because Newfoundland appeared to be in doubt, Trippe looked south. Unfortunately, the political situation in Portugal made it difficult for Pan American to negotiate for traffic rights there as well.

What is interesting here, with respect to the negotiations over Newfoundland, is that it was not the American government doing Pan American’s bidding. It was Juan Trippe. And it was Trippe who personally dealt with the governments of Britain, Canada and Newfoundland, following a pattern used when he negotiated traffic rights to countries in Latin America.

Any hope for trans-Atlantic operations, however, was dashed when, in April 1934, the British government demanded reciprocity with the United States over traffic rights.  The British government spoke for Imperial and questioned why the U.S. government did not speak for Pan American, as both entities were instruments of national policy. Trippe had overestimated his diplomatic skills and his “go-it-alone diplomacy” was not working. He admitted that he did not see much future for Pan American in the North Atlantic. In addition the British, in 1934, had nothing like Pan American’s S-42, then the most advanced aircraft in the world. Until Imperial Airways had a similar aircraft that could cross the Atlantic to the United States, Pan American would find itself blocked from operating to Britain.

S-42The focus thus switched to the Pacific. After a “great circle” trans-Pacific route through the north was ruled out due to issues between the United States and the Soviet Union, it was decided to take the route that represented the longest distance between the United States and the Orient: the mid-Pacific.

Here, the issue of traffic rights was not a problem for Pan American. The route involved stops at Honolulu, Midway, Wake and Guam, terminating in Manila, all of which were under U.S. jurisdiction. At Guam and the Philippines, the U.S. Navy had established bases on the pretext of potential confrontation with Japan. Midway was being used by the Navy for war games staged in the area. Wake, a tiny island, discovered by Trippe in the New York Public Library, was an uninhabited coral atoll, and a minor trophy of the Spanish-American War. It was a critical point for the trans-Pacific flight. Trippe eventually got permission to use the island as a base.

On 24 October 1935 the U.S. Post Office awarded Trippe the trans-Pacific FAM and on 22 November, the China Clipper inaugurated service from the mainland United States across the Pacific.

China Clipper

 

U.S. REGULATION OF AIR TRANSPORTATION

The first instance of United States regulation of aircraft and airmen was in the Air Commerce Act of 1926. It defined “Air Commerce” as carriage by aircraft of persons or property for hire, and the navigation of aircraft in the furtherance of or for the benefit of a business. It established federal regulations regarding aircraft, airmen, navigational facilities and air traffic, including the development and maintenance of airways and aircraft altitude separation. The Act required that aircraft were to be inspected for airworthiness and were required to have markings on the outside for identification. It also provided the requirement that airmen be tested for aeronautical knowledge and have a physical examination completed to insure their physical fitness.

The Act also promoted civil aviation to attract capital and provide a legal basis necessary for its development. The Aeronautics Branch of the Department of Commerce was established by an amendment to the Act in 1929 and was responsible for overseeing and implementing the Act. The regulations promulgated would be known as Civil Air Regulations (CARs).

caa1938In 1935, the Federal Aviation Commission (FAC), a board created by Congress in 1934 to study airline regulation and recommend policy called for creation of a centralized and independent authority to regulate the airline industry. As a result Congress passed the Civil Aeronautics Act of 1938 that was signed into law by President Roosevelt. The Act established the Civil Aeronautics Authority (CAA) and transferred federal responsibilities for non-military aviation to that new independent agency. The Act also gave the CAA quasi-judicial and legislative functions related to economic and safety regulation. This included regulation of fares and routes the air carriers would serve. The CAA was also responsible for aviation regulations, airways, navigational facilities and air traffic control.

The Act created a three-member Air Safety Board that investigated accidents and made recommendations to eliminate the causes of accidents and also provided for an Administrator, who performed executive functions related to the development, operation and administration of air navigations, as well as the promotion of aviation. Airmail contracts were replaced by “Certificates of Public Convenience and Necessity”.

CAAwing

In 1940, President Roosevelt split the CAA into two agencies, the Civil Aeronautics Administration, which went back to the Department of Commerce, and the Civil Aeronautics Board (CAB). The offshoot of the original CAA retained responsibility for ATC, airmen and aircraft certification, safety enforcement, and airway development. CAB Welch Pogue NASM Archivesresponsibilities included safety rulemaking, accident investigation and economic regulation of the airlines. The latter included passenger fares, air mail rates, route entry and exit, mergers and acquisitions and inter-carrier agreements. The routes of the then existing airlines were “grandfathered” and these airlines became later known as “trunks”, a term borrowed from the trunk railroads of the day. These trunk airlines were certified to operate on medium and long-haul interstate routes under Section 401 of the enabling legislation and were sometimes referred to as “401 carriers”.  In 1942, L. Welch Pogue, Esq., was appointed Chairman of the CAB and served until 1946.

UAL_Route_Map_1940

1941-april-27-american-airlines-timetables-route-maps-and-history_4712

TWA 1935

American_DC-3     Boeing 247-1

 

EARLY EUROPEAN AVIATION

Initial Operations

In the United Kingdom, Aircraft Transport and Travel, a fixed-wing airline, operated the first international route in the world between Hounslow Heath outside London and Le Bourget near Paris. The airline also won the first British DH16-AT&Tcivil airmail contract between Hawkinge and Cologne. Handley Page, another airline, operated a London-Paris passenger service.

In France, Société Générale des Transports Aériens operated flights between Toussus, le Noble and Kenley (near Croydon, outside London), and Compagnie des Messageries Aériennes operated airmail and freight service between Le Bourget and Lille.

In Germany, Deutsche Luft Hansa was created in 1926 and became a major investor in airlines outside Europe, particularly in South America. The German manufactured Junkers, Dornier and Fokker aircraft were at the time the most advanced in the world.

In the Netherlands, KLM, the oldest continuously operating airline in the world made its first flight in 1920 between Croydon Airport, London and Amsterdam.KLM-poster-1919

In Finland, Aero O/Y (now Finnair) started operations in 1924 between Helsinki and Tallinn, Estonia.

And in the Soviet Union, the Chief Administration of Civil Air Fleet was established in 1921. Later, a German-Russian joint venture was established to provide flights to the west from Russia. Domestic operations were begun in 1923 by Dobrolyot and from 1932, all operations were carried under the name “Aeroflot”.

Farman-goliath France

European Airlines Recognized as Airmail Carriers

The period of 1920-1927 was a period of significant development for air transportation but the postalHandley_Page_0_100_aircraft administrations and airlines were in the dark as to future possibilities for international airmail. By 1924, the idea of using aircraft for the transportation of mail began to gain momentum, and in September, 1927, at a conference called at the suggestion of the Air Transport Committee of the International Chamber of Commerce held at The Hague, an agreement was reached that established airlines as officially recognized carriers of the mail. The Conference also initiated rules and regulations concerning the acceptance and rapid delivery of airmail, a rate-making structure, the expeditious handling of airmail by countries without air services, and the basis of accounting procedures for international airmail. Another provision agreed was that the PAR AVION labels should have a blue color and, when the mail did not actually travel by air, such labels or annotations should be crossed out.

EUROPEAN CONSOLIDATION AND EXPANSION

Consolidation 

In the United Kingdom, there was a movement toward consolidation to compete with the subsidized French and German airlines. In 1924, Imperial Airlines was formed through a merger of four airlines, and was able to compete with these French and German carriers. In addition the airline began survey flights to far-flung parts of the British Empire. The airline also ordered the Handley Page W8f City of Washington.

Tanken van een vliegtuig met twee propellers. Schiphol, Nederland, 1927.

In France, Air Union was formed in January 1923 and later merged with four other airlines to become Air France in 1933.

Expansion

After consolidation survey flights, Imperial Airlines extended its operations during the late 1920s and 1930s to the furthest reaches of the British Empire. Destinations included South Africa, Australia, British India, Rangoon, Singapore, Basra, Karachi, Hong Kong, etc. The aircraft, however, were small, with a capacity of fewer than 20 passengers, and the passengers consisted of the wealthy or British men doing colonial administration, business or research.

Air France’s operations depended on links to points in North Africa and Indochina.

KLM in the Netherlands also depended on links to its far flung colonies, including the East Indies.

Hindenburg_at_lakehurstGermany, however, lacked colonies but began expanding services with the airship Graf Zeppelin in regular scheduled passenger service between Germany and North and South America. Airship Hindenburg entered passenger service and successfully crossed the Atlantic 36 times before crashing at Lake Hurst, New Jersey, in May 1937.

One point of interest here is that during this time the state-owned flag carriers of several European nations were establishing “foreign routes” to their own colonies in Asia, Africa and the Indian Sub-Continent, all without the need to obtain traffic rights. Privately owned Pan American did not have this luxury and was required to obtain traffic rights to operate not only to the European countries, but to their colonies as well.

The maps below illustrate the typical route systems of two key international airlines prior to and during World War II. The U.S. carrier, Pan American, obtained its authority through negotiating for landing rights at overseas destinations. The foreign carrier, Imperial of Great Britain offered overseas destinations through its colonies. As previously noted, Pan American’s initial transpacific authority came about by virtue of U.S. control of waypoints between San Francisco and Manila. The authority to Hong Kong came about after Pan American’s Juan Trippe used his previously obtained landing rights in Portuguese Macao to pressure the British to grant him landing rights in Hong Kong. At the time, the China National Aviation Corporation (C.N.A.C.) was yet another subsidiary of Pan American. Note the extent of operations in Latin America. 

PAA Map 1940    PAA South America

Imperial_routes_April_1935

SITUATION AT THE EVE OF WORLD WAR II

 Late 1930s

By the late 1930s, Pan American had launched trans-Atlantic flights with the Boeing 314 flying boat. The British and French were operating trans-Atlantic flights as well, but only under mail contracts. Pan American was the only airline with the capacity to accommodate passenger traffic.

314a-oct 13

Imperial flying boat-cropped

 

 

 

 

 

At the same time, U.S. domestic airlines (and Pan American) were looking at high-capacity-long range landplanes (DC-4 and Lockheed Constellation).

War Looms

War was looming in Europe and at the same time, Pan American began experiencing problems with its Boeing 314 operation due to bad weather in the winter months. Both these factors prompted a shift to a southern route that nearly doubled the flight time between the European continent and New York. The route departed Lisbon and stopped in Bolama (West Africa), Port of Spain and Bermuda before arriving in New York.

On the eve of World War II, Juan Trippe recognized that a shift from flying boats to landplanes on trans-Atlantic routes was inevitable. He was initially interested in acquiring the pressurized Lockheed Constellation and was “given permission” by Howard Hughes to acquire it. However, the war started and both DC-4 and Constellation production was shifted to the war effort.

C-69Navy-C54

For all intents and purposes, the world’s airlines shifted their operations to wartime, including Pan American and the U.S. domestic airlines. Other than the U.S. regulations that governed the U.S. carriers, international commercial aviation was governed by the provisions of the Paris Convention of 1919 and the Havana Convention of 1928. It would soon become obvious that both were obsolete.

END OF PART TWO

The next installment of this story, Part 3, will cover World War II, the Chicago Convention of 1944, ICAO, Air Services Agreements, the Freedoms of the Air, the concept of the “Chosen Instrument”, IATA and the Bermuda Agreement of 1946.

Aviation Regulation – History and Practice – Part 1

Aviation Regulation – History and Practice

Part One

INTRODUCTION

It would not be an overstatement to say that the history of aviation regulation can be a history of commercial aviation. Indeed, the rules and regulations promulgated since the Paris Convention of 1919 have been largely driven by the technological advances of manned flight, beginning that December day in Kitty Hawk, North Carolina when the Wright Brothers first went airborne with the powered Wright Flyer.

Wright Brothers-2

This history will be presented in several parts. This first part will cover the Paris Convention of 1919, the Havana Convention of 1928, the Warsaw Convention and U.S. airmail contracts. Subsequent parts will cover foreign airmail contracts, early U.S. regulation, early European aviation, European airmail, European consolidation and expansion, the situation leading up to World War II, the Road to Chicago, the Chicago Convention, the Bermuda Agreement of 1946, the International Air Transport Association, the Federal Aviation Act of 1958, the role of the airline industry in international politics, the deregulation movement, the Airline Deregulation Act of 1978, the International Air Competition Act of 1979, Open Skies, liberalization of European aviation, the US-EU Air Transport Agreement, the Montreal Convention, Consumer Protection, Airline Certification/Fitness, the National Transportation Safety Board and a discussion of current issues.

EARLY ISSUES AND CONVENTIONS

 Sovereignty over Airspace

Before manned flight, the “Air” was considered “free” and no individual state had authority over it. However, with no authority, state and national sovereignty, national interests and security were compromised. This was most apparent during World War I with the development of the flying machine as an instrument of war.

800px-Royal_Aircraft_Factory_SE5a   Curtiss JN-4 Jenny Brian Karli

Paris Convention of 1919

The technical developments in aviation arising out of World War I created a completely new situation at the end of the hostilities, especially with regard to the safe and rapid transport of goods and persons over prolonged distances. However, the war had also shown the ugly potential of aviation; it had therefore become much more evident that this new and now greatly advanced means of transport required international attention and an urgent need for some kind of international regulation of aviation. Thus, at the Paris Peace Conference (Congrès de la Paix) of 1919 the idea of international collaboration in aviation matters was brought forward and, on 13 October 1919 the Convention Relating to the Regulation of Aerial Navigation was signed by 27 States. The convention also created the International Commission for Air Navigation (ICAN).

Paris Convention-1 ICAOThe convention recognized a state’s full and absolute sovereignty over its airspace; recognized the desirability of the greatest freedom of international air navigation consistent with state sovereignty and security concerns; and recognized the requirement that every aircraft possess the nationality of the contracting state. In addition, the convention provided for the safe conduct of air navigation, including provisions for airworthiness certificates, licenses for pilots and international rules for the air, including signals, lights, collision prevention and procedures for landing and moving on the ground.

 

 

Havana Convention of 1928

As a consequence of the failure of the United States to ratify and the join the League of Nations, and therefore not joining the convention, the rules and provisions of the Paris Convention did not apply to the Americas. As a result, there was a need for a separate form of international cooperation on a regional American basis.

During the 5th International Conference of the American States in Santiago, Chile, in 1923, a resolution was adopted providing for the creation of an Inter-American Commercial Aviation Commission to consider problems related to aviation. The Pan American Convention on Commercial Aviation was finalized in Havana on 20 February 1928. The Havana Convention was modeled after the Paris Convention and it applied exclusively to private aircraft (government aircraft were not included) and laid down basic principles and rules for aerial traffic, recognizing that every State had complete and exclusive sovereignty over the airspace above its territory and adjacent territorial waters. Clauses also enabled U.S. owned airlines to freely operate services within North and South America.

Warsaw Convention of 1929

With the growth of commercial international air transportation in the 1920s, there came a need to protect air carriers (at the time mostly state-owned with the notable exception of the privately owned air carriers in the United States) from open-ended liability in case of damage to or loss of cargo or baggage and injury or death of passengers. And, on the other hand, shippers and passengers needed to be reassured that if something went wrong they would have an effective remedy against the carrier and be compensated.

Thus after a series of conferences starting in 1927, the Convention for the Unification of Certain Rules relating to International Carriage by Air was signed in Warsaw in 1929, known as the Warsaw Convention.

The Convention applied to any international transportation of persons, baggage or merchandise by aircraft and provided for airline liability for death or injury to passengers; loss or damage to baggage; and loss resulting from delay in the transportation of passengers, baggage or merchandise. The dollar amount of liability was limited.

The Convention has been amended, most notably by the Hague Protocol of 1955, but will be superseded by the Montreal Convention of 1999 upon full ratification.

 

EARLY U.S. GOVERNMENT INVOLVEMENT IN AVIATION

Air Mail Contracts

1024px-Airmail_1930s_Detroit_Smykowski

Early U.S. government involvement in aviation dealt with the issuance of airmail contracts. The first act of Congress related to this was the Contract Air Mail Act of 1925 (Kelly Act) that authorized the Postmaster General to award Airmail stamp 1925-1 Airmail stamp 1925-2contracts to private individuals or companies involved in the air transportation of the mail. Routes and tariffs were established and the airlines were given subsidies that encouraged the introduction of passenger service.

 

The Air Mail Act of 1930 (McNary-Watres Act) changed the way air mail contracts were awarded and eliminated Model Boeing 40competitive bidding. The Act encouraged companies to buy large aircraft and also stimulated the carriers to fill space on the aircraft with passengers. The Act was a product of Postmaster General Walter F. Brown’s request for legislation giving him authority to change postal policy. As a result, the Act gave Brown strong authority over the nationwide air transportation system. There were three main provisions of the Act: The first provision changed the way payments to airlines were calculated, rating them based on volume of mail, rather than weight. It also set a fee on planes of a certain size, whether it was flying mail or not, to discourage the flying of large amounts of junk mail and to encourage the carrying of passengers to increase revenue.

SwallowThe second provision allowed any airmail carrier with an existing contract of at least two years standing to exchange its contract for a “route certificate” giving it the right to haul mail for 10 additional years. The third and most controversial provision gave Brown authority to “extend or consolidate” routes in effect according to his own judgment.

Soon, at what later became known as the “Spoils Conference” Brown invoked his authority under the third provision to consolidate the airmail routes to only three companies, friends of the administration of President Hoover, forcing out the small competitors: Boeing Air Transport (the northern airmail route), Transcontinental Air Transport, later Transcontinental 1280px-EarlyDH4and Western Air (TWA), (the mid-United States route) and Robertson Aircraft Corporation, later American Airways (the southern route). Brown also extended the southern route to the West Coast of the United States, and awarded bonuses for carrying more passengers and purchasing multi-engine aircraft equipped with radios and navigation aids.

 

Ford 5-AT-B

Although this led to increased productivity and efficiency in the airline industry, the small airlines complained that they were left out of Brown’s scheme and a Congressional investigation followed. The “spoils” were exposed and as a result, the legality of the contracts awarded under Brown’s leadership were questioned.

1d_1934-3

On 19 February 1934, President Roosevelt canceled all existing airmail contracts, and, as a temporary measure, directed Army Air Corps General Benjamin D. Foulois to organize a new airmail operation using military planes and pilots. It did not work. The airmen were inexperienced in cross-country flying and the aircraft were ill-equipped. There were numerous crashes and the cost of flying the mail skyrocketed. By 10 March, 12 pilots had died in 66 crashes or forced landings. Could it be that these problems were a product of those provisions of the Havana Convention of 1928 that excluded government aircraft from its application? On 8 May, Roosevelt and then Postmaster General James Farley returned to private contract airmail.

Keystone_B-6_twin-engine_airmail_plane_in_snow_storm,_1920

The return to private airmail contracts came in conjunction with the Air Mail Act of 1934 (Black-McKellar Act). Under the Act, no airline that had held a contract before the government takeover could bid for a contract. To circumvent this, however, the airline companies simply changed their names: Boeing Air Transport became United Air Lines; TWA became TWA Inc., and American Airways became American Airlines. The Act’s main provision broke up the aviation holding companies, large corporations that owned both aircraft manufacturing companies and airlines. The Act also stated that the government would set airmail contracts, routes and schedules; fix subsidy rates and airmail payments; and regulate the airways and license pilots. The Interstate Commerce Commission (ICC) regulated rates and the Secretary of Commerce specified the equipment to be used.

END OF PART ONE

The next installment of this story, Part Two, will cover Foreign Air Mail Contracts, early U.S. Regulation of Air Transportation, European Air Transportation and the situation prior to World War II.