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ASTA, Allies Welcome Airline Assurances On Credit Cards

August 31, 2009 By: George Dooley

Statements by the CEOs of Southwest Airlines and Continental Airlines  that, “fairly construed, they have no intention to adopt the policy recently announced by United Airlines to shift merchant fee costs onto consumers” were welcomed by ASTA, the Business Travel Coalition (BTC), the Interactive Travel Services Alliance (ITSA) and the National Tour Association (NTA).
“We applaud the statements made by Continental and Southwest," ASTA President and Chairman Chris Russo said in a statement. "Their candor is appreciated, even when associated with the usual cautionary remarks related to publicly held companies making forward-looking statements. It is a fair interpretation of their remarks that neither airline sees value in the United Airlines policy and that neither intends to adopt it. Travel agents have been looking for some sign that the consumer and travel agency problems created by the pass-through policy are understood, and it seems to us that these two industry leaders 'get it.'
“Unfortunately, these statements, while welcome and encouraging, do not put the issue to rest," Russo continued. "As long as the other airlines remain silent on the issue, we have no choice but to continue our campaign in Congress for hearings to evaluate solutions to the threat posed to consumers and travel agents. ASTA and its members have been working hard to educate members of Congress about this issue and are seeking, and are hopeful of getting, formal hearings in both houses of Congress to address the legislative changes that are necessary to offset the damage that the spread of pass-through policies would impose. We will continue this fight for the interests of our members and their customers as long as the imposition of these policies remains a threat."
As background, ASTA said that on June 26, 2009, United Airlines quietly began providing selected travel agencies nationwide with less than one month’s notice that, effective July 20, they would no longer be permitted to use United’s merchant account for credit card ticket sales.

“Instead, agencies would be forced to obtain and use their own merchant accounts and settle with the airline in cash," Russo said. "That deadline has since been extended 60 days at the request of members of Congress. In cutting off travel agents from its merchant account, many of those travel agencies will be forced out of business, while those who are able to open merchant accounts of their own would be forced to pass additional fees on to their clients. In 10 states, however, law forbids retailers from passing credit-card surcharges on to consumers.""
ASTA and its allies— the Business Travel Coalition, the Interactive Travel Services Alliance and the National Tour Association— will brief Congressional staff and the press on the latest developments on this issue at 10 a.m. ET this Tuesday, September 1 in Room 121 of the Cannon House Office Building in Washington, DC.

 The event is part of the groups’ ongoing efforts to urge Congress to call for a hearing to look more deeply into United’s actions and the devastating consequences these actions could have on the travel agency industry and consumers. Seventeen members of Congress and two senators wrote to United’s leadership to express their concern over the impact of this new policy and to request that United delay implementation of the policy in order to give Congress time to study the issue and formulate an appropriate response.


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