The Business Travel Coalition (BTC) is calling for authorities in Europe to investigate the recently-announced charge on non-NDC bookings on British Airways and Iberia flights.
In an open letter to David Currie, chairman, UK Competition and Markets Authority; Dame Deirdre Hutton, chairman, UK Civil Aviation Authority; and Margrethe Vestager, European Commissioner for Competition, European Commission, the BTC called the surcharge an “anti-competitive and anti-consumer development in the UK and EU marketplaces for commercial airline services that warrants an investigation.”
“In the marketplace for travel distribution services airlines, travel agencies and travel management companies are competitors,” the BTC wrote. “When a dominant airline participant in the direct distribution channel intentionally and discriminatorily forces a £8 per segment surcharge on indirect channel participants, is it potentially using its dominant market position in both the marketplace for commercial air transportation services and travel distribution services to illegally drive up the costs of its indirect distribution channel competitors harming them and potentially causing many of them to exit the market.”
The BTC also noted that many GDS contracts with airlines preclude programs like the surcharge. The organization also raised the possibility that similar charges could spread throughout Europe, North America and elsewhere.
According to a statement from the two airlines provided to Travel Agent, the two airlines will begin applying a charge of 8 pounds per fare component to any bookings not made using an NDC-based connection, starting November 1. The charge will not apply to bookings made through the airlines’ websites, sales offices and call centers. It will also be charged as 9.50 euros or US$10.
The move is similar to Lufthansa’s decision to introduce a 16 euro fee back in 2015 for bookings made through a GDS. In announcing the new policy, Lufthansa also cited the growing cost of distribution through GDS in its reasoning at the time. The new policy drew broad criticism from travel industry groups and travel agents, with then-Travel Leaders Group CEO Barry Liben arguing that the move would place Lufthansa “at a competitive disadvantage on airfare pricing.”
In April, Ukraine International (UIA) also introduced a fee for non-partnered travel agents when booking tickets on behalf of their clients using a GDS.