accordance with § 302.18, except that permission to amend a third-party complaint after the filing of an answer but before the docketing of a petition for enforcement must be obtained from the Director of the Bureau of Enforcement. § 302.202 Subscription and verification.

Every formal complaint, supplemental complaint, answer or other pleading filed in an economic enforcement proceeding shall be signed by the party filing the same, or by a duly authorized officer, agent or attorney of such party. In addition, such documents shall be verified under oath by the person so signing. Such verification shall set forth that the person verifying the document has read the same and knows the contents thereof and the attached exhibits, if any, and that the matters and things therein stated are true of his own knowledge, except such matters therein stated on information and belief, and as to such matters he believes them to be true. the subscription and verification, or either of them, be by anyone other than the party filing the same or an officer or attorney of such party, the reason therefor must be stated and the power of attorney or other authority authorizing such affiant to subscribe the document and make the verification must be filed with the document.

If

§ 302.203 Insufficiency of formal complaint.

In any case where the Director of the Bureau of Enforcement is of the opinion that a complaint does not sufficiently set forth the material required by any applicable rule, regulation or order of the Board, or is otherwise insufficient, he may advise the party filing the same of the deficiency and require that any additional information be supplied by amendment.

§ 302.204 Third-party complaints.

(a) A third-party complaint, and any amendments thereto, submitted pursuant to 302.201 shall be served by the person filing such documents upon each party complained of and upon the Director of the Bureau of Enforcement.

(b) Within fifteen (15) days after the date of service of a third-party complaint, each persor. complained of shall file an answer in conformance with and subject to the requirements of § 302.207 (b). Extensions of time for filing an answer may be granted by the Director

of the Bureau of Enforcement for good cause shown.

(c) A person complained against in a third-party complaint may offer to satisfy the complaint through submission of facts, offer of settlement or proposal of adjustment. Such offer shall be in writing and shall be served, within fifteen (15) days after service of the complaint, upon the same persons and in the same manner as an answer. The submittal of an offer to satisfy the complaint shall not excuse the filing of an answer.

(d) Motions to dismiss a third-party complaint shall not be fileable prior to the docketing of a petition for enforcement with respect to such complaint or a portion thereof.

§ 302.205

Procedure when no enforcement proceeding is instituted.

(a) Within a reasonable time after a formal third-party complaint has been processed, the Director of the Bureau of Enforcement shall either institute an enforcement proceeding in accordance with § 302.206 or shall advise the complainant in writing that no enforcement proceeding will be instituted in whole or in part, with respect to his complaint, and the reasons therefor.

(b) The letter of the Director of the Bureau of Enforcement shall conform to the requirements of § 302.3 and shall be deemed an order of the Board dismissing the complaint unless review of such ruling is requested by the complainant or is initiated by the Board in accordance with the provisions of paragraph (c) of this section.

The

(c) Within twenty (20) days after service of a letter from the Director of the Bureau of Enforcement refusing to institute an enforcement proceeding with respect to all or any part of a complaint, the complainant may file a motion with the Board to review such action. proceedings on such motion shall be in accordance with § 302.18. Upon conclu sion of such proceedings, the Board shall enter an order either dismissing the complaint or directing such other action as it deems appropriate. If a complainant does not appeal, the Board may review the action of the Director of the Bureau of Enforcement on its own initiative within 15 days after the expiration date for appeal.

[PR-70, 27 F.R. 12545, Dec. 19, 1962, as amended by PR-78, 28 F.R. 5293, May 29 1963]

§ 302.206 Docketing of petition for enforcement.

Whenever in the opinion of the Director of the Bureau of Enforcement there are reasonable grounds to believe that any provision of the act or any rule, regulation, order, limitation, condition or other requirement established pursuant thereto, has been or is being violated, that, in the case of third-party complaints, efforts to satisfy a complaint insofar as required by § 302.204 have failed, and that investigation of any or all of the alleged violations is in the public interest, the Director of the Bureau of Enforcement may institute an economic enforcement proceeding by docketing a petition for enforcement. The petition for enforcement shall incorporate by reference a formal complaint submitted pursuant to § 302.201 or shall be accompanied by a complaint complying with § 302.3 which is verified by an enforcement attorney. The petition for enforcement, and accompanying complaint, if any, shall be formally served upon the respondent and complainant. The proceedings thus instituted shall be processed in regular course in accordance with this part. However, nothing in this part shall be construed to limit the authority of the Board to institute or conduct any investigation or inquiry within its jurisdiction in any other manner or according to any other procedures which it mav deem necessary or proper.

§ 302.207 Answer.

(a) Within fifteen (15) days after the date of service of a petition for enforcement docketed pursuant to § 302.206, the respondent shall file an answer to the complaint attached thereto or incorporated therein unless an answer has already been filed in accordance with § 302.204. Any requests for extension of time for filing of answer to a complaint attached to or incorporated in a petition for enforcement shall be filled with the Board in accordance with § 302.17.

(b) All answers shall conform to the requirements of § 302.8 (a) (2) and shall fully and completely advise the parties and the Board as to the nature of the defense and shall admit or deny specifically and in detail each allegation of the complaint unless the person complained of is without knowledge, in which case, his answer shall so state and the statement shall operate as a denial.

Failure of a respondent to file and serve an answer within the time and in the manner prescribed by this part shall be deemed to authorize the Board, in its discretion, to find the facts alleged in the petition to be true and to enter such order as may be appropriate without notice or hearing, or, in its discretion, to proceed to take proof, without notice, of the allegations or charges set forth in the complaint or order, provided that the Board or examiner may permit late filings of an answer for good cause shown.

ters of fact stated in the request with respect to such documents. Each of the matters of which an admission is requested shall be deemed admitted unless within a period designated in the request, not less than ten (10) days after service thereof, or within such further time as the Board or the examiner may allow upon motion and notice, the party to whom the request is directed serves upon the requesting party a sworn statement either denying specifically the matters of which an admission is requested or setting forth in detail the reasons why he cannot truthfully either admit or deny such matters. Service of such request and answering statement shall be made as provided in § 302.8. Any admission made by a party pursuant to such request is only for the purposes of the pending proceeding, or any proceeding or action instituted for the enforcement of any order entered therein, and shall not constitute an admission by him for any other purpose or be used against him in any other proceeding or action.

§ 302.213 Hearing.

After the issues have been formulated, whether by the pleadings or otherwise, the examiner or the Board shall give the parties reasonable written notice of the time and place of the hearing.

§ 302.214 Appearances by persons not parties.

With consent of the examiner or the Board, appearances may be entered without request for or grant of permission to intervene by interested persons who are not parties to the proceeding. Such persons may, with consent of the examiner or the Board, cross-examine a particular witness or suggest to any party or counsel therefor questions or interrogations to be propounded to witnesses called by any party, but may not otherwise examine witnesses and may not introduce evidence or otherwise participate in the proceeding. However, such persons may present to both the examiner and the Board an oral or written statement of their position on the issues involved in the proceeding. § 302.215 Offers of settlement.

Any party to an economic enforcement proceeding at any time prior to final decision thereof may submit offers of settlement or proposals of adjustment. Each such offer or proposal shall be sub

mitted in writing and addressed to the Director of the Bureau of Enforcement, who will promptly advise the party or parties submitting same whether he will recommend acceptance thereof to the Board. If the Director of the Bureau of Enforcement advises the party or parties that he will not recommend acceptance, and the party or parties so request in writing, he will transmit such offer or proposal directly to the Board for its consideration and acceptance or rejection. The submission of such offer or proposal shall not alter or delay the course of the proceeding unless so ordered by the Board.

§ 302.216 Evidence of previous viola.

tions.

Evidence of previous violations by any person of any provision of the act or any requirement thereunder found by the Board or a court in any other proceeding or criminal or civil action may, if relevant and material, be admitted in any enforcement proceeding involving such person.

§ 302.217

Motions for immediate suspension of operating authority pendente lite.

All motions for the suspension of the economic operating authority of an air carrier during the pendency of proceedings to revoke such authority shall be filed with, and decided by the Board. Proceedings on the motion shall be in accordance with § 302.18. In addition, the Board shall afford the parties an opportunity for oral argument on such motion.

Subpart C-Rules Applicable to Mail Rate Proceedings

§ 302.300 Applicability of this subpart This subpart sets forth the special rules applicable to proceedings for the establishment of mail rates by the Board. For information as to other applicable rules, reference should be made to Subpart A of this part, to the Federal Aviation Act, and to the substantive rules, regulations and orders of the Board. § 302.301 Parties to the proceeding.

The parties to the proceeding shall be the air carrier or carriers for whom rates are to be fixed, the Postmaster General, bureau counsel, and any other person whom the Board permits to intervene. (See § 302.15.)

In addition to participation in hearings in accordance with § 302.14, persons other than parties may, within the time fixed for filing notice of objections to an order to show cause in a mail rate proceeding as provided in § 302.305, submit a memorandum of opposition to, or in support of, the position taken in the petition or order. Such memorandum shall not be received as evidence in the proceeding. § 302.303

Institution of proceedings. Proceedings for the determination of rates of compensation for the transportation of mail may be commenced by the filing of a petition by an air carrier whose rate is to be fixed, or the Postmaster General, or upon the issuance of an order by the Board.

(a) The petition shall set forth the rate or rates sought to be established, a statement that they are believed to be fair and reasonable, the reasons supporting the request for a change in rate, and a detailed economic justification sufficient to establish the reasonableness of the rate or rates proposed.

(b) In any case where a carrier is operating under a final mail rate uniformly applicable to an entire rate-making unit as established by the Board, a petition must clearly and unequivocally challenge the rate for such entire rate-making unit and not only a part of such unit: Provided, however, That this rule shall not apply (1) to petitions seeking equalization of service mail rates to a lower competitive level in order to participate in the carriage of mail between specific points or (2) to petitions by local service air carriers for ad hoc adjustments pursuant to provisions therefor in local service class subsidy rates. Unless a petition clearly and unequivocally requests review of the rate for the entire rate-making unit, it shall be dismissed. ment intended to cure the omission shall be given retroactive effect.

No amend

(c) All petitions, amended petitions, and documents relating thereto shall be served upon the Postmaster General by sending a copy to him by registered or certified mail, postpaid, prior to the filing thereof with the Board. Proof of service on the Postmaster General shall consist of a statement in the document that the person filing it has served a copy on the

Postmaster General as required by this section. The petition need not be accompanied by any further proof of service, but, upon setting any petition down for public hearing, the Board will cause notice of such hearing to be given to such interested persons as it deems appropriate in the particular case.

[PR-70, 27 F.R. 12545, Dec. 19, 1962, as amended by PR-100, 31 FR. 13943, Nov. 1, 1966]

PROCEDURE WHEN AN ORDER TO SHOW CAUSE IS ISSUED

§ 302.304

Order to show cause.

Whether the proceeding is commenced by the filing of a petition or upon the Board's own initiative, the Board may issue an order directing the respondent to show cause why the Board should not adopt such provisional findings and conclusions, and such rates, as may be specified in the order to show cause.

§ 302.305 Objections and answer to order to show cause.

(a) Any person having objections to the provisional rates specified in such order shall file with the Board a notice of objection within ten (10) days after the date of service of such order.

(b) If such notice is filed as aforesaid, written answer and any supporting documents shall be filed within thirty (30) days after the service of the order to show cause. The Board may specify different times for filing a notice of objection or an answer. An answer to an order to show cause shall contain specific objections, and exhibits in support thereof, and shall set forth the findings and conclusions, the rates, and the supporting exhibits which would be substituted for the corresponding items in the Statement of Provisional Findings and Conclusions, if such objections were found valid.

(c) A notice or answer filed by a person who is neither a party nor a person ultimately permitted to intervene shall be treated as a memorandum filed under § 302.302.

§ 302.306 Effect of failure to file notice

or answer.

If no notice, or if after notice, no answer is filed within the designated time, all parties shall be deemed to have waived the right to a hearing and all other procedural steps short of a final decision of the Board fixing rates, and the Board may thereupon, upon the basis

of all of the documents filed in the proceeding, enter a final order fixing the fair and reasonable rate or rates as specified in the order to show cause. § 302.307 Procedure after answer.

If an answer is filed within the time designated in the Board's order, a prehearing conference and hearing shall be held unless waived by all parties. The issues shall be limited to those specifically raised by the answer, except that at the prehearing conference, the examiner may permit the parties to raise such additional issues as he deems necessary to a full and fair determination of a fair and reasonable rate. (Reference should be made to Subpart A of this part for rules applicable to hearings.)

§ 302.308 Evidence.

All direct evidence shall be in writing and shall be filed in exhibit form in advance of the hearing unless, for good cause shown, the examiner otherwise directs.

PROCEDURE WHEN NO ORDER TO SHOW CAUSE IS ISSUED

§ 302.309 Hearing to be ordered.

When no order to show cause is to be issued by the Board, the Board will order a hearing before an examiner similar to that provided for in §§ 302.307 and 302.308, except that the issues at such hearing shall be formulated initially at a prehearing conference.

TEMPORARY RATE PROCEEDINGS

§ 302.310 Procedure for fixing temporary service and subsidy mail rates. (a) At any time during the pendency of a proceeding for the determination of final mail rates, the Board, upon its own initiative, or on petition by the carrier whose rates are in issue or the Postmaster General, may fix temporary rates of compensation for the transportation of mail subject to downward or upward adjustment upon the determination of final mail rates.

(b) Temporary service mail rates: The procedure for determining temporary mail rates involving an issue as to the service mail rates payable by the Postmaster General pursuant to section 406 (c) of the Act shall be the same as for the determination of final mail rates, except that:

(1) Notice of objections to the Board's show cause order proposing temporary

service mail rates must be filed by any party or petitioner for intervention within 8 days, and an answer within 15 days, of the time such order is served;

(2) Failure to file notice of objections within the 8-day period shall be deemed to be a waiver of all further procedural steps before final decision, including hearing and initial or tentative decision, and the proceeding will stand submitted to the Board for final decision.

(3) In the absence of a convincing showing that it will result in substantial prejudice to any party or delay the proceeding, the examiner shall require the parties to submit all their testimony in writing and shall closely limit crossexamination to the essential issues (bearing in mind the purpose and urgency of fixing temporary mail rates together with the fact that such temporary rates are subject to downward or upward adjustment upon the fixing of final rates), and shall in all other respects urgently expedite the proceeding.

(c) Temporary subsidy mail rates: The procedure for determining temporary mail rates involving an issue as to the subsidy mail rates payable by the Board pursuant to section 406 (c) shall be the same as for the determination of temporary service mail rates pursuant to paragraph (b) of this section except that:

(1) After the filing of answers (if any) the Board may in its discretion (i) issue a final order establishing temporary mail rates at the same level as that proposed in the show cause order, or a different level, (ii) set the matter down for an evidentiary hearing before an examiner, or (iii) notice the matter for oral argument before the Board. Neither oral argument nor an evidentiary hearing will be granted except upon a showing, set forth in the answer, (a) that the case presents major issues of fact or policy which cannot fairly be resolved on the basis of written documents, and (b) that the establishment of the rates proposed in the show cause order would have a critical impact on the carrier by reason of its immediate and pressing cash requirements. In the case of requests for evidentiary hearing, the answer shall set forth in detail the nature of the evidence which the party requesting hearing would submit if hearing were granted.