Civil Aviation Regulatory Reform Act

Civil Aviation Regulatory Reform Act - Amends the Federal Aviation Act of 1958 to direct the Civil Aeronautics Board in the exercise of its duties with respect to interstate and overseas air transportation to consider the encouragement of new air carriers and maximum reliance on competition in the air transportation system as being in the public interest.

Stipulates that with respect to applications for certificates to engage in interstate and overseas air transportation the Board shall find that such application is consistent with the public convenience and necessity if it requests authority to engage in nonstop service between two points between which another carrier holds such authority but which has not exercised it to a specified extent. Direct the Board to approve applications for authority to engage in nonstop service between two points which are 350 miles apart or less and between which at least 40,000 origin-destination passengers were transported by certificated air carriers during the preceding year.

Entitles air carriers holding such a certificate to select two pairs of points each calendar year for automatic market entry for nonstop service. Establishes minimum levels of service for such markets.

Prohibits the Board from granting an interstate or overseas all-cargo certificate to an applicant who holds a certificate from the Interstate Commerce Commission and who, during the previous calendar year, grossed more than $3,000,000 in accordance with tariffs approved by the Commission unless the Board specifically finds that the granting of such a certificate is in the public interest and would not substantially lessen competition in any line of commerce or tend to create a monopoly.

Authorizes air carriers to discontinue or reduce service to a community upon 90 days' notice. Authorizes the Board to prohibit such action under specified circumstances.

Stipulates that there shall be three types of certificates to engage in foreign air transportation: (1) a certificate to engage in foreign scheduled air transportation of persons, property, and mail; (2) a certificate to engage in foreign charter air transportation; and (3) a certificate to engage in foreign all-cargo air transportation.

Establishes insurance requirements for air carriers.

Prohibits the transfer of a certificate unless such transfer is necessary to carry out a consolidation, merger, or acquisition of control agreement approved by the Board.

Sets forth considerations which the Board is to take into account in determining the reasonableness of airline rates. Declares it to be the policy of Congress to permit maximum feasible upward price flexibility in markets in which there is a sufficient effective competition to permit such upward flexibility without undue risk of unjust or unreasonable high fares.

Prohibits the Board from approving a pooling or other agreement which: (1) is between an air transportation and a common carrier subject to the Interstate Commerce Act governing the compensation to be received by the common carriers for transportation services; (2) limits the level of capacity provided by air carriers in interstate or overseas air transportation in markets in which air carriers compete; (3) fixes rates (except for joint rates) for interstate or overseas air transportation; or (4) is for a period of more than five years.

Exempts air carriers which provide passenger service solely with aircraft which have a maximum passenger capacity of less than 56 passengers or cargo service with aircraft having a maximum payload capacity of less than 18,000 pounds from the requirement that such a carrier hold a certificate of public convenience and necessity and other such requirements as the Board may promulgate in regulations. Authorizes the Board to increase such passenger or payload capacity when the public interest so requires.

Directs the Board to determine and pay compensation for essential air service by air carriers to small communities and isolated areas.

Requires the Board to pay such compensation when it prohibits an air carrier from discontinuing service to a community.

Sets forth procedural deadlines for Board determinations on application under the Federal Aviation Act.