DOT Opposes Proposed Consumer Airline Protections

The U.S. Department of Transportation (DOT) said it opposes consumer protection measures in a Senate bill that would require, among other things, new rules governing involuntary bumping and the disclosure and regulation of airline fees.

In a May 23 letter, DOT Deputy General Counsel James Owens stated that a variety of the Senate’s proposed consumer protection measures “could impose many unnecessary, expensive, and counter-productive regulatory burdens on the American people and the broader economy,” and that the passage of the regulations “would constitute significant regulatory overreach.”

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Under Senate Bill 1405, the DOT would be required to examine flight cancellation fees, checked baggage fees, seat selection fees, flight change fees, and “any other fee imposed by an air carrier relating to a flight in interstate air transportation,” to determine if they are reasonable and priced to the consumer at a level appropriate to the expense incurred by the airlines.

In 2017, U.S. airlines earned about $7.5 billion in baggage and reservation change fees, and recently many consumer advocates have begun to complain about whether carriers are taking advantage of air passengers.

In the letter to Senator Bill Nelson, ranking member of the Committee on Commerce, Science and Transportation, Owens specifically called this requirement “one of the more objectionable” Senate provisions. Owens also sent a similar letter to Committee Chair John Thune.

Owens called the airline industry “highly competitive” and wrote that “this measure, if enacted, would reverse to a significant extent the ground rules that have governed the airline industry since the 1978 Airline Deregulation Act (ADA).”

Additionally, the Trump administration called “objectionable” rules that would bar airlines from denying seats to passengers who have already checked in or were cleared by the gate attendant to board. Owens stated that such a rule would make it more difficult to oversell a flight to compensate for no-shows, or potentially outright prohibit the practice.

The letter comes as the Senate prepares to begin discussing legislation to reauthorize funding for the Federal Aviation Administration (FAA). In April, the House of Representatives passed their version of a FAA reauthorization bill, 393 to 13.

Senator Nelson expressed concern about the DOT’s position. In a statement emailed to Travel Market Report, he said: “As we start the busy summer travel season, this letter makes one wonder who the Department of Transportation is looking out for:  the traveling public or the airlines?”

Senator Thune’s office did not reply to a request for comment by press time.

ASTA weighs in
One area where the DOT agrees with travel advisors, and the American Society of Travel Agents (ASTA), is section 3108 of the Senate bill, mandating the disclosure of fees to consumers by the airlines and “ticket agents … at all points of sale.” While ASTA and agents have lobbied for fee transparency, they also have expressed their concern about the potential burden imposed on agents from having to read a long list of fee disclosures to clients over the phone.

Owens noted in his letter that the “DOT already requires air carriers to prominently disclose on the carrier’s website information about fees for all optional services that are available for purchasing.”

Eben Peck, ASTA’s executive vice president, advocacy, said: “While we disagree with the DOT’s assertion that ‘the airline industry is highly competitive, and consumers continue to realize enormous benefits’ from it, we share the Department’s concern about some of the overly broad consumer disclosure requirements in the Senate bill and its determination that new customer service standards for large travel agencies are unwarranted.”

“In consultation with our members, we look forward to working with Congress over the coming months to ensure that consumers are fully protected in the travel marketplace and have access to the comparison shopping, unbiased advice and personal support that only ASTA member companies provide,” Peck said.

Owens also called proposed rules to permanently ban mobile phone calls onboard planes as “problematic;” said the administration opposed any measures to regulate airline seat sizes; and said “the number of rulemakings, advisory committees, and reports to Congress” included in the House and Senate bills “will consume a significant portion of the resources that could otherwise be used to enforce aviation consumer protections.”