PROGRESS NOTED IN FAA TECHNICAL REVIEW

UNCLAS SECTION 01 OF 02 BELGRADE 000168

SIPDIS

EB FOR EB/TRA/AN T. ENGLE/L. JONES
PARIS FOR FAA/L. LUI
USDOT FOR FAA/NANCY ANGELO

E.O. 12958: N/A
TAGS: EAIR SR MW KTIA ICTY
SUBJECT: PROGRESS NOTED IN FAA TECHNICAL REVIEW

REF: BELGRADE 1803

SUMMARY
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1. A Federal Aviation Administration (FAA) team completed
its technical review of the Serbia and Montenegro Civil
Aviation Directorate (CAD) on January 27 in Belgrade. The
review results found significant progress in all areas of the
CAD's oversight capabilities since the last technical review
in October 2003. The most important recommendation is
approval of identical civil aviation laws in both Serbia and
Montenegro (SAM) that give the Director General full
authority to regulate civil aviation. The review results
give the CAD a road map in preparation for an International
Aviation Safety Assessment (IASA) audit and also provide a
basis for offering technical assistance through a USTDA
grant. END SUMMARY.

SIGNIFICANT PROGRESS SINCE OCTOBER 2003
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2. From January 23 through January 27, 2006, a team from the
FAA conducted a technical review of the CAD in Belgrade. The
purpose of the visit was to identify progress on the October
2003 recommendations and benchmark the CAD's compliance with
the International Aviation Safety Assessment (IASA)
checklist. Serbia and Montenegro currently is in Category 2,
meaning the FAA assessed the CAD in the past and determined
that it does not provide safety oversight of its air carrier
operators in accordance with the minimum safety oversight
standards established by the International Civil Aviation
Organization (ICAO). As a consequence, carriers from SAM are
not permitted to commence service to the United States while
in Category 2 status, although they may conduct services if
operated using aircraft wet-leased from a duly authorized and
properly supervised U.S. carrier or a foreign air carrier
from a Category 1 country that is authorized to serve the
United States with its own aircraft.


3. The team noted in their debriefing with CAD authorities
on January 26 that significant progress in all areas had been
made since the October 2003 review. One of the team's main
recommendations was completion of a new aviation law that
would be identical in both republics. Since the FAA visit in
2003, this new draft law has progressed and is expected to be
in Parliament by April 2006. However, there are currently
two drafts of the law, one for each republic, since each
republic must separately enact the aviation law. However,
these drafts are not identical, and if approved, serious
problems could arise since the CAD would operate according to
two laws with different provisions.


4. The draft laws also require important revisions to ensure
that the Director General has full authority to prescribe
regulations, issue orders and carry out necessary functions
in order to provide effective safety oversight in accordance
with minimum international standards. If these changes are
not made to the existing draft law, FAA officials say, it
will not meet minimum international standards. The CAD
officials agreed with the team on these recommendations and
are working to make the necessary changes.


5. Other areas needing improvement are listed below, but the
FAA team noted that most of these recommendations would be
relatively easy to implement.

SPECIFIC OPERATING REGULATIONS
-- Continue the final work to promulgate the rest of the
Joint Aviation Regulations (JARs),including development of
the bylaws or cover sheets to incorporate the JARs under the
new aviation law once it enters into force.

-- Ensure that CAD personnel are adequately trained on the
JARs, and the new aviation law, once it is enacted.

CAA STRUCTURE AND SAFETY OVERSIGHT FUNCTIONS
-- Ensure each specialty (technical personnel) in the CAD
documents its hiring standards.

-- Review and document compliance with the appropriate
standard for each newly hired technical employee and ensure
that they have industry experience commensurate with the
industry they will oversee.

TECHNICAL GUIDANCE
-- Develop guidance material for all medical functions.

-- Develop guidance material for all Aircraft Engineering
Department (AED) functions. (This should be developed prior
to addition of these functions to CAD.)

-- Technical guidance must be developed for the medical
department documenting the processes either electronically or
by a policy and procedures manual. The department must
establish a file to include examiner's training records.

QUALIFIED TECHNICAL PERSONNEL
-- Implement, and document a comprehensive OJT training
program, for all technical personnel to include aircraft
engineering, operations, airworthiness, cabin safety, and
avionics inspectors; licensing; and medical personnel.

-- Implement, and document a program to insure that the
inspectors are as current and qualified at the same level as
the personnel they oversee.

LICENSING AND CERTIFICATION OBLIGATIONS
-- Develop, implement, and document a training program for
designated medical examiners.

-- Develop, implement, and document a surveillance program to
oversee designated examiners by appropriately qualified
inspectors.

RESOLUTION OF SAFETY ISSUES
-- Ensure the new law and regulations include appropriate
enforcement provisions.

-- Ensure CAD inspectors have adequate guidance materials to
prepare enforcement actions and that they are properly
trained in the new penalty requirements.

OPEN SKIES AGREEMENT IMMINENT?
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6. During the technical review, econoff asked Deputy
Director General Dragoljub Trgovcevic for an update of the
Open Skies Agreement. Trgovcevic said that he believed that
approval of the draft text by the Council of Ministers is
imminent, stating that Montenegro had already approved the
draft and Serbia most likely would approve it in the next two
weeks. Once the draft text is approved by the full Council,
the agreement will be ready for signing and then ratification
in the Parliament. We expect this text to include the minor
language changes already agreed to in talks between the
Embassy and the directorate last year.

NEXT STEPS
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7. The recommendations from the technical review provide the
CAD with a road map of what remains to be done in order to
complete a successful IASA audit that would move Serbia and
Montenegro to Category 1. In addition, funds remain from a
US Trade and Development Agency grant that can be provided to
the CAD for developing its oversight capacity. There is
approximately a remaining USD 60,000 that must be spent by
the end of FY 2006. Based on the recommendations of the FAA
team, technical assistance and training opportunities can be
targeted at areas in need of improvement. Post will work
with the FAA and the CAD to ensure that these funds are used
to strengthen the CAD's oversight capacity as it prepares for
an FAA IASA assessment.

POLT