For a discussion of the likely impact on agents of the new DOT rules, please see related story, “DOT Expected to Enforce New Air Rules Aggressively."
New rules from the U.S. Department of Transportation (DOT) that go into effect this week are expected to have a profound impact on how travel agents conduct business.
The Transportation Department’s new rules require that advertised airfares show all-in pricing, including travel agency booking fees.
Also, airlines must now allow consumers to cancel an airfare within 24 hours of booking without penalty, and price increases are banned after airfares are paid in full.
A guide to the new rules
Here is a summary of the Department of Transportation’s game-changing rules that take effect this week.
The recap is based on a seminar by ASTA executive vice president of legal and industry affairs Paul Ruden and an interview with travel industry attorney Alexander Anolik of Tiburon, Calif.
24-hour rule: When an air reservation is made one week or more before departure, the airline is required to: (1) allow the passenger to hold the fare without payment for 24 hours, or (2) accept payment but allow the passenger to cancel within 24 hours and get a refund without penalty.
Impact: “This changes the terms of every nonrefundable ticket, and consumers will like this,” said Ruden.
The rule also ends agents’ advantage with the ARC void rule, in which an agent can cancel a booking without penalty within 24 hours, Ruden noted.
All-in advertising rule: The advertised price must include the fare, all fees and taxes. All unavoidable charges must be included.
Impact: Advertising of airfares will be radically changed, noted Ruden.
Here’s an example cited by travel agent Rick Ardis, owner of Ardis Travel in East Rutherford, N.J., in the newspaper the Record:
Under the rules, the advertised fare on a Lufthansa flight to Frankfurt should be $3,004 – rather than the previously advertised $2,200. That higher all-in fare includes a $646 fuel surcharge, along with other fees and taxes.
Baggage fee disclosure rule: Airlines and travel agents with websites must, on the first screen where prices are quoted, inform passengers that additional fees for baggage may apply. The screen should also indicate where customers can go to see the baggage fees.
Baggage allowance and bag fees also must be disclosed on e-ticket confirmations.
Travel agents can comply via a hyperlink to the baggage fee disclosure page on an airline’s website.
ASTA is pushing DOT to require that airlines put this information on GDSs, so agents don't have to direct customers to an airline website.
Post-purchase price-increase ban: After final payment, airlines cannot increase the price of a ticket – expect when consent is obtained from the customer and except for government-imposed taxes.
This rule applies to all products, such as tours and cruises, that include an airfare component.
Flight delay notification rule: Airlines must notify customers of flight delays of 30 minutes or more and of flight cancellations within 30 minutes after the airline learns of the delay or cancellation.
“Carriers [are] required to immediately inform passengers about delays and cancellations so they don’t spend all day waiting at the airport,” said Anolik.