DHL Corporation and Subsidiaries - Page 8

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               In the early 1970’s, one of petitioner’s competitors filed a           
          complaint with the CAB, alleging that petitioner was not just a             
          courier but also operated as an international air freight                   
          forwarder.  The competitor complained that, as a result of the              
          international freight forwarding, petitioner was required to have           
          CAB operating authorization, which it did not have at that time.            
          On April 11, 1972, petitioner filed for CAB interstate and                  
          international operating authorization, and the complaining                  
          competitor objected.  CAB regulations prohibited individuals who            
          were not U.S. citizens from owning more than 25 percent of a U.S.           
          air freight forwarder.  On May 24, 1973, DHL and Dalsey                     
          transferred their DHLI shares to nominees, ostensibly foreign, of           
          Po Chung for little or no consideration.  After that transfer of            
          the DHLI stock, the CAB, on December 19, 1973, authorized DHL’s             
          status as an interstate and international air freight forwarder.            
               Thereafter, the CAB prohibition on foreign “control” of DHL            
          was a significant factor in corporate and shareholder decisions             
          to attempt to keep foreign and domestic activities separate.                
          Operationally, DHL and DHLI, with limited exceptions, were                  
          autonomously managed by their respective officers, but with a               
          common commitment to the DHL network.  The exceptions involved              
          DHL’s chief executive officer’s responsibilities over DHLI’s                
          Canadian, Mexican, and Latin American operations.  The common               
          commitment to the network was nurtured by the NSC, consisting of            

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Last modified: May 25, 2011