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U.S. Department of Transportation
Federal Aviation Administration
Advisory
Circular
Sdject: PRIVATE CARRIAGE VERSUS COMMON Date: 4124186 AC No:^ 12042A
CARRIAGE OF PERSONS OR PROPERTY Initiated by: AFS-820 Change:
1 0 PURPOSE.^ This^ advisory^ circular^ furnishes^ Federal^ Aviation^ Administration (FAAmnnel and interested segments of industry with general guidelines for determining whether current or proposed transportation operations by air constitute private or common carriage. If^ the^ operations^ are^ in^ interstate^ or foreign commerce, this^ distinction^ determines^ whether^ or^ not^ the^ operator^ needs economic authority as an "air carrier" from the Department of Transportation. Operations that constitute common carriage are required to be conducted under Federal Aviation Regulations (FAR) Parts 121 or 135. Private carriage may be conducted under FAR Parts 125 or 91, Subpart D. Operations conducted under FAR Section 91.181, which permits certain charges to be made, may also be subject to these guidelines , particularly the "time sharing" provisions of FAR Section 91.181(c)(l). It^ should^ also^ be^ noted^ that^ lease^ agreements^ -entered into under FAR Section 91.181 are subject to FAR Section 91.54, "Truth% leasing clause requirement in leases and conditional sales contracts."
2 CANCELLATION. (^) Advisory Circular 120-12, Private Carriage Versus Common
Cirriage By Comercial Operators Using Large Aircraft, dated June 24, 1964, is
canceled.
3 BACKGROUND.^ "Common^ carriage"^ and^ “private^ carriage"^ are^ common^ law^ terms. The Federal Aviation Act of 1958 uses the term "common carriage" but does not define it. It has therefore been determined that guidelines giving general explanations of the term "common carriage" and its opposite, "private carriage," would be helpful,
4 GUIDELINES. to the public,
A carrier becomes a common carrier when it "holds itself out" or to a segment of the public, as willing to furnish transportation within the limits of its facilities to any person who wants it. Absence of tariffs or rate schedules, (^) transportation only pursuant to separately negotiated contracts, or occasional refusals to transport, are not conclusive proof that the carrier is not a common carrier. There are four elements in defining a common carrier; (1) a holding out of a willingness to (2) transport persons or property (3) from place to place (4) for compensation. This "holding out" which makes a person a common carrier can be done in many ways and it does not matter how it is done.
a. Signs^ and^ advertising^ are^ the^ most^ direct^ means^ of^ "holding^ out" but are not the only ones.
AC 120~12A 4124186
b. A "holding^ out"^ may^ be^ accomplished^ through^ the^ actions^ of^ agents, agencies, or salesmen who may, themselves , procure passenger traffic from the general public and collect them into groups to be carried by the operator. It is particularly important to determine if such agents or salesmen are in the business of selling transportation to the traveling public not only through the 'group' approach^ but^ also^ by^ individual^ ticketing^ on^ known^ common^ carriers.
c. physical1^ y^ holding^ out^ without^ advertising^ where^ a^ reputation^ to^ serve all is gained is sufficient to constitute an offer to carry all customers. There are many means by which physical holding out may take place. For example, the expression of willingness to all customers with whom contact is made that the operator can and will perform the requested service is sufficient. The fact that the holding out generates little success is of no consequence. The nature and character of the operation are the important issue.
d. Carriage for hire which does not involve "holding out" is private carriage. Private carriers for hire are sometimes called "contract carriers," but the term is borrowed from the Interstate Commerce Act and legally inaccurate when I* used in connection with the Federal Aviation Act. Private carriage for hire is carriage for one or several selected customers , generally on a long-term basis. The number of contracts must not be too great, otherwise it implies a willingness to make a contract with anybody. A carrier operating pursuant to 18 to 24 contracts has been held to be a common carrier because it held itself out to s,erve the public generally to the extent of its facilities. Private carriage'has -been ' found in cases where three contracts have been the sole basis of the operator's business. Special adaptation of the transportation service to the individual L needs of shippers is a factor tending to establish private carriage but is not necessarily conclusive.
e. A^ carrier^ holding^ itself^ out^ as^ generally^ willing^ to^ carry^ only^ certain kinds of traffic is, nevertheless, a common carrier. For instance, a carrier authorized or willing only to carry planeloads of passengers, cargo, or mail on a charter basis is a common carrier, if it so holds itself out. This is, in fact, the basic business of supplemental air carriers.
f. A^ carrier^ flying^ charters^ for^ only^ one^ organization^ may^ be^ a^ common carrier if membership in the organization and participation in the flights are, in effect, open to a significant segment of the public. Similarly,^ a^ carrier^ which flies planeload charters for a common carrier, carrying the latter's traffic, engages in common carriage itself.
& Occasionally,^ offers^ of^ free^ transportation^ have^ been^ made^ to^ the^ general public by hotels, casinos, etc. In such cases, nominal charges have been made which, according to the operators, bear the expense of gifts and gratuities. However, the operators maintain that the transportation is free. The^ courts^ have held that such operations are common carriage based on the fact that the passengers are drawn from the general public and the nominal charge constituted compensation.
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