DOT Fines Agents for Violations of Codeshare Disclosure Rules

The U.S. Department of Transportation (DOT) fined five online ticket agents for failing to adequately disclose to consumers when flights were being operated under a codesharing arrangement. The action follows similar fines against two other agents and is part of the DOT’s effort to ensure that sellers of air transportation are complying with DOT’s codeshare disclosure rules.

Fareportal, Inc. was assessed a $50,000 civil penalty; American Travel Solutions, LLC, was assessed $45,000; AirGorilla, LLC, was assessed $30,000; Wholesale Travel Center, Inc., was assessed $30,000; and Automobile Club of New York, Inc. was assessed $20,000 for violating the DOT’s codeshare disclosure requirements. Last month, was assessed a $40,000 civil penalty, and Airtrade International, Inc. was assessed a $50,000 penalty for codeshare disclosure violations.

“When passengers buy an airline ticket, they have a right to know which airline will be operating their flight,” said U.S. Transportation Secretary Ray LaHood. “I hope these fines serve as a warning to airlines and ticket agents that we will continue to take enforcement action when we find violations of our codesharing rules.”

Under codesharing, an airline will sell tickets on flights that use its designator code, but are operated by a separate airline. DOT rules require airlines and ticket agents to disclose to consumers, before they book a flight, if the flight is operated under a codesharing arrangement. The disclosure must include the corporate name of the transporting carrier and any other name under which the flight is offered to the public. Under a new law, when tickets are purchased on the Internet, codeshare information must be easily viewable on the first display of a website following a search for flights corresponding to a desired itinerary.

Investigations by the DOT’s Office of Aviation Enforcement and Proceedings revealed that the ticket agents, at least during the latter half of 2010, violated the codeshare disclosure rules by failing to disclose that certain flights listed on their Internet sites were being operated by a regional carrier on behalf of a major airline. The listings did not display the corporate names of the operating carriers and other names under which the carriers operating the flights do business.