CRSs today
 

Significant changes have taken place in the CRS industry since the last revision of EU and US rules in the early 1990s. Most notably, all US-based CRSs have been completely divested of airline ownership. In addition, the Internet has become an increasingly important channel for the distribution of travel services. These changes, combined with a number of other factors, point to a clear need to revise the existing rules.

The European Commission's review of the existing EU CRS rules is both timely and well-intentioned. Indeed, customers support deregulation of a number of aspects of the CRS industry, however, unbounded deregulation in the EU is not the answer. Instead, carefully calibrated and thought-out rules of fair play must be adopted that effectively restrain the accepted propensity of parent carriers to discriminate against independent CRS systems in favour of the CRS they own to the detriment of non-owning airlines, travel agents and ultimately consumers.

In the US, market conditions led the Department of Transportation (DOT) to conclude that the US CRS rules should be terminated; however, fundamentally different circumstances persist in the EU. The independent, but corroborating observations and findings of the US DOT and DOJ, as well as the Brattle Report, clearly point toward the need for clear rules designed to protect against abuses by airline owned CRSs and their parent carriers.

A long history confirms that when an airline (or airlines) holds vertically integrated stakes in CRS companies it will, unless constrained by specific rules, engage in exclusionary conduct that distorts competition to the detriment of consumers. Rejecting the conclusions of the Brattle Group, especially the recommendation for the continuation of the so-called mandatory participation rule, would place the interests of Europe's consumers at risk. Without the obligation of parent carriers to treat users of other systems fairly, consumers will have less choice and face higher fares in key EU markets.