VZCZCXRO4480
PP RUEHDBU RUEHIK RUEHLN RUEHPOD RUEHVK RUEHYG
DE RUEHKV #2542 2821136
ZNR UUUUU ZZH
P 091136Z OCT 07
FM AMEMBASSY KYIV
TO RUEHC/SECSTATE WASHDC PRIORITY 4001
INFO RUCNCIS/CIS COLLECTIVE PRIORITY
RUEHZG/NATO EU COLLECTIVE PRIORITY
RUEHMO/AMEMBASSY MOSCOW PRIORITY 0257
RUEHMT/AMCONSUL MONTREAL PRIORITY 0007

UNCLAS KYIV 002542 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE FOR EUR/RUS PATTERSON, 
EEB BYERLY AND COLEMAN 
USDOC FOR 4231/ITA/MAC/EUR/RISA BROUGHER AND BEADLE 
USDOC FOR 3004/CS/ADVOCACY/BLOOM 
USICAO MONTREAL FOR LAURA FAUX-GABLE 
NSC FOR WARLICK AND MCKIBBEN 
 
E.O. 12958: N/A 
TAGS: EAIR ETRD KTIA PREL UP
SUBJECT: UKRAINE: GOU TELLS IATA ALL ISSUES RESOLVED: IATA 
AWAITING OFFICIAL CONFIRMATION 
 
REF: A. KYIV 2383 
     ¶B. KYIV 1974 
     ¶C. KYIV 2788 
     ¶D. STATE 10632 
 
Treat as Sensitive but Unclassified.  Not for Internet. 
 
¶1. (SBU) On September 20, the GOU told the International Air 
Transport Association (IATA) that all issues regarding IATA's 
Billing and Settlement Program (BSP), including its ticket 
stock, had been officially resolved and IATA was no longer in 
danger of being shut down (ref C).  The Ministry of Finance 
confirmed the GOU's stance on October 2, when it finally 
approved IATA's request to register its ticket stock, noting 
that MinFin had received the necessary approval from the 
Ukrainian State Aviation Administration (SAA). 
 
¶2. (SBU) The breakthrough came when IATA CEO Giovanni 
Bisignani met September 20 with Ukrainian Deputy Minister of 
Transportation and Communications and Head of the Ukrainian 
SAA, Anatoliy Kolisnyk, on the margins of the International 
Civil Aviation Organization General Assembly in Montreal. 
Bisignani asked Kolisnyk for written confirmation that 
Ukraine no longer had any issues with IATA.  To date, 
however, that written assurance has not been forthcoming, and 
SAA officials have told us that they have no intention of 
giving IATA such a letter.  They cite the approval of IATA's 
ticket stock by the MOF as sufficient evidence of Kolisnyk's 
commitment to the IATA.  IATA has also not yet received 
formal confirmation from the Ministry of Economy that it will 
rescind its order suspending all IATA's cross border 
transactions.  IATA says the Ministry of Economy is still 
waiting for confirmation from the Procurator General that the 
original basis of the GOU's complaint against IATA (the use 
of unregistered ticket stock) has been resolved.  (Note: 
Ambassador plans to raise IATA's status with Minister of 
Economy Kinakh during a scheduled meeting later this week.) 
 
¶3. (SBU) In a September 28 discussion with EconOff, Deputy 
Director of the SAA Dmytro Babeichuk blamed IATA's Country 
Director Sergey Martinyuk for the breakdown in relations 
between IATA and the GOU that ultimately led to the treat to 
shut down IATA.  Babeichuk argued relations between the SAA 
and IATA would have been much better if IATA had registered 
its ticket stock in 2005 instead of pursuing the issue as a 
matter of principle in Ukrainian courts, a process that 
lasted two years.  Babeichuk said the SAA was unable to work 
with Martinyuk, a Ukrainian citizen.  Several  airlines and 
embassies share the view that Martinyuk is part of the 
problem.  They say his confrontational style and stubborn 
refusal to register IATA's tickets until after the GOU 
threatened to shut down IATA exacerbated the situation.  The 
SAA has invited mid-level IATA reps to Kyiv in mid-October to 
discuss its relationship with IATA, its problems with 
Martinyuk and whether IATA's electronic tickets (the recent 
dispute only concerned IATA's paper tickets) conform to 
Ukrainian law. 
 
Comment 
------- 
 
¶4. (SBU) The SAA's continued interest in the trade 
organization's electronic tickets may be a signal that IATA's 
problems with the GOU are not over.  In any case, industry 
reps in Kyiv have told us that they suspect the ticket issue 
to be a front for the SAA's desire to capture the large cash 
flows generated by IATA's BSP cleaning system.  The SAA's 
stance on IATA's electronic tickets, which we expect to 
surface during the upcoming meetings with IATA, should shed 
more light on the GOU's true intentions.  End comment. 
Taylor