April 30 - Letter To U.S. DOT Secretary LaHood Regarding IATA Resolution 787


April 30, 2013


The Honorable Ray LaHood

Secretary

U.S. Department of Transportation

1200 New Jersey Avenue, SE

Washington, Dc 20590


Re: Docket No. OST-2013-0048 – International Air Transport Association Resolution 787


Dear Secretary LaHood:

We the 214 undersigned government, university and corporate travel managers, travel management companies (TMCs), industry associations and other stakeholders from six continents and nineteen countries, who represent millions of travelers, urge the U.S. Department of Transportation (DOT) to reject Resolution 787, and the included New Distribution Capability (NDC), as it contravenes the public interest. NDC represents a new, worldwide business model for the pricing and sale of airline tickets that could structurally change the industry in unalterable ways adversely impacting all supply-chain participants. We were excluded from IATA proceedings that led to the creation of Resolution 787, and therefore, rely on the Department to protect our interests. 

A single firm, if not dominant, is usually free under national competition laws to endeavor to change an industry’s economic and operational models. It is a horse of a different color, however, when 240 horizontal competitors strategize behind closed doors and agree upon a new business model for the pricing and sale of their products. We firmly believe that horizontal airline competitors (and indeed nearly the entire industry) banding together to jointly adopt such a new business model by express agreement crosses the line. NDC is an agreement that has the purpose and would have the effect of stabilizing or raising prices charged to all consumers because it would end the air fare transparency that, as the airlines themselves have confirmed, has checked their ability to raise prices. It thus likely violates U.S. and other countries’ antitrust laws.  

This new business model would also violate privacy rights. Resolution 787 explicitly says that, before fares are quoted, airlines have the right to demand from consumers personal information that “includes but is not limited to” the customer’s name, age, marital status, nationality, contact details, frequent flyer numbers (on all carriers), prior shopping, purchase and travel history and whether the purpose of the trip is business or leisure. There can be no legitimate justification for charging a traveler more or less based on a number of these items of personal information (such as marital status or nationality), and many of them by design can be used to pinpoint and extract higher prices from those travelers who are likely to be less price sensitive, such as business travelers.

Importantly, IATA has been silent on required industry investments to implement NDC, or which participants would be responsible for such costs, i.e. airlines, global distribution systems, travel agencies or organizations with managed-travel programs. However, most observers believe the NDC-associated costs to be substantial and that these costs would be passed on to the customer in the form of higher TMC transaction fees, or surcharges. Process costs and inefficiencies related to NDC complexities would also be externalized to TMCs and their clients. 

Given the potential anti-competitive and anti-consumer effects of Resolution 787, the unprecedented invasion of privacy for consumers and the added implementation and ongoing NDC-related costs to the industry and its customers, DOT should deny its approval.

Respectfully submitted,

Transportation Appeals Tribunal of Canada

Scottish Passenger Agents' Association

Air Passengers Association of India

Brazilian Travel Agencies Association (ABAV)

Association of Canadian Travel Agencies (ACTA)

American Society of Travel Agents

Association for Airline Passenger Rights

FlyersRights.org

Consumer Travel Alliance

Business Travel Coalition

The Travel Company Edinburgh (Scotland UK)

Continental AG (Germany)

ABRACORP (Brazil)

Atlantis Air Service (Czech Republic)

ZF Friedrichshafen AG (Germany)

UNIGLOBE Normark Travel Inc. (Canada)

Procurian (Brazil)

UCB Pharma (Belgium)

Flightline Travel Management (United Kingdom)

Nomad Travels (India)

Adidas Group (Germany)

TRAVELORAMA (CYPRUS)

AWise (Netherlands)

Roberta's Travel Solutions (Trinidad and Tobago)

QA Business Travel (UK)

Viatur Travel Services (Costa Rica)

NaranTours LLC (Mongolia)

Wings Travel (Zimbabwe)

Abav SP (Brazil)

Alpi Viajes C.A. (Venezuela)

Cresta World Travel (United Kingdom)

MTU Friedrichshafen GmbH / Tognum AG (Germany)

Wayte Travel Management (United Kingdom)

TierOne Travel (Canada)

Barrhead Travel (United Kingdom)

Sportscorp Travel (Canada)

Tourvest Travel Services (South Africa)

MKI Travel (Canada)

Redfern Travel Ltd (UK)

Maduro Travel (Curacao)

VEMSA LalianXa Travel Network (Costa Rica)

Valtours Ltd (Iceland)

Lempira Tours (Honduras)

Saint Joseph's University

The George Washington University

University of Delaware

Travizon

Home Box Office, Inc.

Ovation Travel Group, Inc.

Travel Store, Inc.

Valerie Wilson Travel

Wells Fargo & Company

MICROS Systems, Inc.

J.C. Penny

Royal Caribbean International

BCD Travel

Constellation Brands

Ralph Lauren Corp.

Dollar Tree Stores

Western Digital Technologies, Inc.

FreemanWhite, Inc.

Makino, Inc.

CH2M HILL

Epic Systems Corporation

Autoliv Americas

Nationwide Intelligence

Hickory Global Partners

Travel and Transport

The Travel Team, Inc.

World Travel, Inc.

BTI The Travel Consultants

HealthCare California

Autodesk, Inc.

Nike, Inc.

Lighthouse Consulting Partners, Inc

ZOLL Medical

CFA Institute

FAC

Wyndham Jade

Lumbermens Merchandising Corp.

Purcell Systems, Inc.

Goss International

Cameron

TravelStore, Inc.

Sun Travel, Inc.

Stephens

Holiday Travel American Express

International Travel Management

Sandbach Holdings LLC

Carroll Travel

All-Travel

Katherine Christensen & Associates, Inc.

Hidden Treasure Tours, Inc.

DSM Functional Materials

Computershare LLC

Buon Viaggio Travel

A Plus Travel Corporation

Travel Management Partners, Inc.

Caldwell Travel

Acendas 

A & I Travel Management, Inc.

Advent Travel Leaders

Colwick Travel

Cannon Design

down2earth adventures, LLC

Peak Travel Group

Accent Travel / Milbern Travel Inc.

Country Place Travel, Inc.

Sanditz Travel Management

Antietam Travel Service, Inc.

Sunset Travel Agency

Professional Travel, Inc.

FindingTheBetterWay.com

COLPITTS WORLD TRAVEL

Mann Travels

Far Horizons Travel

CROWN INTERNATIONAL TRAVEL, INC.

ADTRAV Travel Management

Travel Leaders/Travelinc LLC

MSW Travel Group

CI Travel

Premiere Travel

Mean Green Travel

Conlin Travel

The Remington Group

Geraci Travel

Guardian Travel, Inc

FHI 360

Up and Away American Express Travel

Alert Logic

Christopherson Business Travel

Maupin Travel Inc.

Frosch-GlobalPoint LLC

Child Travel Services

Anthony Travel, Inc.

Clarksburg Travel

Covington Travel

Metro Travel & Tours, Inc.

Fox World Travel

Travel One, Inc.

Breton Village Travel Services Inc

S.R. Travel Service

Montrose Travel

Holiday Travel International

Sterling Vacations

Anolik Law Corporation

Midwest Travel Consultants, Inc.

Global Travel Ltd

Alpine Travel of Saratoga

ROMANIAN TOURS & TRAVEL

MSP Travel Group

Independent Travel

ILLUMINATION VACATIONS

Awesome Cruises & Tours

The Performance Group

TL Global Travel Inc.

Travel Concepts

M.O. Air International, Inc.

Compass Travel

Carmax

El Sol Travel

Unbridled Travel

Menno Travel

JRF Voyages

LXR Travel, LLC an affiliate of Travel Experts

Hamilton, Miller, Hudson and Fayne Travel Management Corp.

Century Travel

Creative Group, Inc.

Maritz Travel Company

HMHF Travel Mgt. Co.

Travel Centre

Chamberlin Enterprises, Inc. DBA Chamberlin's Travel

OSI Systems, Inc.

Promega Corporation

Bursch Travel

ALASKA TRAVEL SOURCE

Travel By Gagnon

Kamla Int'l Inc, dba Maazda Travel

Travel Leaders Indianapolis

World Travel Service, Inc.

IDEXX Labs

Diplomat Travel Services

Travel Leaders/Travelmore

All Direct Travel

Changing Planes

Rawhide Travel and Tours, Incorporated of Arizona

Hariworld Travel Group, Inc.

Cassis Travel Services, Inc.

Berkeley's Northside Travel

Technicolor

Innovative Travel

Azumano Corporate Travel

BlueLinx Corporation

Conference & Travel

Travel Experts, Inc.

Travelaudits, Inc.

BatteryTravel Assoicates

Altour

Davidson Kaplan Consultants

Travgroup.com a Burekhovich Travel Company

S & P Travels and Tours

Paul Klein Travel

Hope's Travel,Inc. dba ADA Travel

Lindberg Travel

Moorpark Hotel

Pederson Consulting

Provisur Technologies, Inc.

WorldTravelService

Chamberlin's Travel

Travelsavers, Inc.

Travel Leaders

CLG Travel Management

Suzi Davis Travel, LTD

Travel Leaders-MSP Travel Group

©2001 to 2016 Business Travel Coalition, Inc..