US embassy cable - 05BOGOTA3076

UNCLAS BOGOTA 003076 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: EAIR, CO 
SUBJECT: COLOMBIA: CIVAIR'S RESPONSE TO TECHNICAL 
DISCUSSIONS 
 
REF: A. A: 05 STATE 54317 
 
     B. B: 04 BOGOTA 8515 
     C. C: 04 BOGOTA 8906 
     D. D: 04 BOGOTA 8907 
 
1.  Sensitive but unclassified.  Please protect accordingly. 
 
2.  (U) Summary.  Per ref A, post delivered talking points to 
Colonel Montealegre, acting director for Aeronautica Civil 
(CAA), and Carlos Salazar, CAA's Chief of Air Transport.  The 
meeting focused on Avianca's waiver request to the Department 
of Transportation, the GOC's policy on travel agent 
commission rates, and the bilateral Air Transport Agreement. 
CAA responded favorably to the request for technical 
discussions and suggested the end of April or early May for 
talks in Bogota.  On April 5, Fernando Sanclemente was 
selected as the new Director for CAA.  End Summary. 
 
3.  (SBU) On March 31, econoff met with CAA representatives 
to deliver talking points and arrange a meeting between the 
Department of State, Department of Transportation and CAA 
officials for technical discussions related to Avianca's 
request for a foreign ownership waiver.  The CAA accepted our 
request and offered to host the meeting at the CAA's office 
in Bogota either the last week of April or the first week of 
May. 
 
4.  (SBU) Upon delivering the talking points, a CAA 
representative claimed no relationship exists between 
Avianca's request for a waiver and the GOC's practice of 
regulating travel agent commission rates.  The CAA official 
further stated that if the Department of Transportation 
refused Avianca's waiver request, the GOC could possibly 
terminate the current Air Transport Agreement and immediately 
ask to negotiate a new one.  Colombia's rationale is based on 
Law 9 of 1991, which is a national treatment law that assures 
foreign and national investments the same legal and 
administrative treatment.  The CAA added that a new air 
transport agreement between Canada and Colombia remains 
dormant due to the foreign ownership clause. 
 
5.  (SBU) Our CAA contacts asserted that the issue 
surrounding the travel agent commission rates was purely 
political (ref B, C).  They added that ANATO, Colombia's 
national travel agency association, has considerable 
political influence (and some business ties) with the 
Colombian Congress and is a great financial supporter of 
political campaigns. 
 
6.  (SBU) On a brighter note, CAA officials said they would 
be happy to discuss the possibility of negotiating Open Skies 
for cargo aircraft (ref D).  When asked about a general Open 
Skies agreement, CAA officials fell back to their standard 
position concerning general Open Skies, stating that Colombia 
is not ready for such stiff competition (even though the 
majority of Avianca is Brazilian-owned, the Colombian Coffee 
Growers Federation owns 25 percent of the company). 
 
7.  (U) Fortunately, CAA will now have a new director to 
focus on these issues.  On April 5th, the Minister of 
Transportation signed Decree 998, which establishes Fernando 
Augusto Sanclemente Alzate, the current director of Ports and 
Transportation, as the new CAA Director, (it is not known 
when exactly he will assume the duties of Director of CAA, 
however). 
 
8.  (SBU) Comment.  It is hard to believe the CAA would see 
benefit in terminating the Air Transport Agreement, 
especially since it was extended at CAA request.  The threat, 
however empty, is a good indication of CAA frustration.  The 
CAA's acting director understands that the technical 
discussions will be informal, but added that the meeting 
should occur after the new CAA Director is in place. 
Regarding travel agent commission rates, the CAA continues to 
implement a 1999 Colombian law, which authorizes the CAA to 
regulate travel agency commissions.  End Comment. 
WOOD