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DOT Wants More Consumer Protection for Air Travelers

June 2, 2010 By: George Dooley

Building on the Department of Transportation’s (DOT) recent rule banning carriers from subjecting passengers to long tarmac delays and other deceptive practices, DOT Secretary Ray LaHood proposed new consumer protections for air travelers, including increased compensation for passengers involuntarily bumped from flights. The amounts could be increased to $650 and $1,300, respectively, from $400 and $800 currently. Compensation would also be adjusted for inflation every two years.

Key DOT proposals include allowing passengers to make and cancel reservations within 24 hours without penalty; requiring full and prominently displayed disclosure of baggage fees as well as refunds and expense reimbursement when bags are not delivered on time; require fair price advertising; prohibit price increases after a ticket is purchased and mandate timely notice of flight status changes.

“Airline passengers have rights and should be able to expect fair and reasonable treatment when they fly,”   LaHood said. “With this rulemaking, we’re proposing to strengthen the consumer protections enacted last month and raise the bar for airlines when it comes to treating passengers fairly.”

The rule published last December, which adopted a three-hour limit for airline tarmac delays for domestic flights, also required U.S. carriers to adopt contingency plans for lengthy tarmac delays at large-hub and medium-hub airports and to publish those plans on their websites. The new proposed rule would expand the requirement for having contingency plans to include foreign airlines’ operations at U.S. airports and would require carriers to adopt contingency plans for small- and non-hub airports.

The rule also would require the reporting of additional tarmac delay data to DOT. The DOT would collect this data from all U.S. and foreign airlines operating aircraft of 30 or more seats on flights to and from the United States and charter flights. Currently, the DOT collects this data only for the domestic scheduled flights of the 18 largest U.S. airlines.

The proposed rule also would increase the potential compensation for being involuntarily bumped from oversold flights. Currently, airlines may limit compensation for involuntary bumping on flights to $400 if the carrier arranges substitute transportation scheduled to arrive at the passenger’s destination one to two hours after the passenger’s original scheduled arrival for domestic flights, or one to four hours for international flights, and to $800 if the substitute transportation is scheduled to arrive more than two hours later for domestic flights, or more than four hours later for international flights.

The proposed rule would quickly increase these limits to $650 and $1,300, respectively, and thereafter adjust the amounts for inflation every two years.

The DOT also proposed a number of measures to make it easier for consumers to know how much they will have to pay for air transportation. Carriers would be required to provide special notice any time baggage fees are increased, and to notify passengers buying tickets whether they must pay to check up to two bags. The DOT also asked for comment on several alternatives to provide greater access to air transportation to persons with severe peanut allergies. Comments on the proposal are due in 60 days.

The Air Transport Association of America (ATA), the trade organization for the leading U.S. airlines, reacted immediately with a statement. “The ATA member airlines’ shared goal is to provide a safe, efficient, reliable and economically viable air transportation system consistent with the expectations of their customers, employees and shareholders. Today’s DOT notice of proposed rulemaking will be evaluated against that standard, with a focus on minimizing potential passenger inconvenience,” said ATA President and CEO James C. May.

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