Agency Heading in Right Direction
Regarding Full Disclosure of Airline Fees
April 20, 2011, RADNOR, PA – Business Travel Coalition (BTC) today praised the U.S. Department of Transportation (DOT) for its just-announced final rule containing sweeping airline consumer protections. Specifically, BTC applauded DOT Secretary Ray LaHood for recognizing that a new DOT Notice of Proposed Rule Making is urgently needed to require airlines to disclose ancillary fee information (e.g., checked baggage charges, at-airport ticketing fees, etc.) in the same electronic and transactable formats used to publish airfares themselves.
Section 41712 of the Federal Aviation Act prohibits "an unfair or deceptive practice or an unfair method of competition in air transportation or the sale of air transportation" by airlines and TMCs (travel management companies). In BTC’s opinion, the failure of airlines to share information about their ancillary fees with TMCs violates that rule by making it impossible for corporate managed travel programs and individual consumers to efficiently compare air transportation costs among competing providers. Consumers often do not see extra fees until well into the shopping process, or after the purchase, and sometimes not even until they arrive at the airport.
“For two and one-half years, despite major corporations’ substantial collective purchasing power and their continuing calls for fee transparency, airlines have refused to provide TMCs with this vital information”, stated BTC chairman Kevin Mitchell. “This only adds to evidence of a market failure. What’s more, because of U.S. federal preemption in the aviation sector, consumers have virtually no access to protections afforded by state consumer protection laws,” added Mitchell.
According to BTC, the marketplace and state consumer protection laws cannot resolve this problem. As such, DOT is the last bastion of consumer protection and has existing authority to require full disclosure of fee data, as it has historically done by requiring airline code sharing and change of gauge information be shared through the global distribution systems and on to TMCs and consumers.