What Agents Need to Know About New DOT Advertising Regulations

The Department of Transportation’s (DOT) new consumer protection regulations will go into effect January 24 and will dramatically change the way that carriers, travel agents and tour operators do business, according to Al Anolik, Esquire, a veteran industry attorney.

Anolik is concerned enough to issue a detailed advisory to clients, warning of vigorous enforcement action in four key areas. “The DOT will enforce the new laws via the Unfair and Deceptive Practices statute and will be subject to the standard penalty of $27,500 per violation per day.”

The four biggest changes, according to Anolik's analysis, include:
 
Full Fare Advertising Law: Under the DOT’s new interpretation of the Full Fare Advertising Law, when a carrier, agent or tour operator advertises an airfare or package containing an airfare, they must display the full price to be paid inclusive of all taxes and fees, Anolik says in his analysis.

“Previously, the DOT allowed government taxes and fees to be “broken-out” of the advertised price if proper disclosure was provided. This policy will end on January 24 and the DOT will begin to require advertisements that show the entire price to be paid by the customer," Anolik says.

Baggage Fee Disclosure: Under the new baggage fee disclosure law, carriers, agents and tour operators are required to disclose the existence and amount of baggage fees when advertising an airfare or package containing an airfare, Anolik notes.

“Carriers will be required to provide the specific fees applicable to the itinerary. While agents should also provide the specific fees, if this is not possible, they will be permitted to provide a hyperlink to the specific carrier’s baggage fee webpage.”

Opt-Out Prohibition: When offering optional products or services (e.g. upgrades, insurance) in conjunction with an airfare or package containing air transportation, consumers will have to opt-in to purchase the ancillary service, Anolik says.

“In the past, agents and carriers have automatically added optional services like travel insurance, allowing consumers to opt-out if they did not want it. With the new law, the DOT will require purchases of all optional services to be knowing and voluntary by opting-in.”

Post-Purchase Price Increases: The new law strictly prohibits a carrier, agent or tour operator from imposing a price increase after taking a deposit unless the consumer explicitly agrees in writing to a price increase. Ideally, the DOT wants a separate form for this disclosure and signed consent, Anolik reports.

“Once the consumer makes full payment, the new rules prohibit imposing a price increase for any reason other than an increase in government imposed taxes and fees. Again, this is only permitted if the consumer affirmatively consents in writing to a price increase. “

To reserve these rights, Anolik says he is recommending that his clients receive a signed compliant disclosure form before taking an initial deposit.

Anolik and his firm have represented scores of travel agents, industry associations and suppliers and helped form the International Forum of Travel and Tourism Advocates (IFTTA). 

Visit www.travellaw.com

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