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Pestronk Mark
Q: Under DOT’s proposed rule, I understand that travel agencies are legally responsible for refunding travelers when the carrier cancels or significantly delays a flight.
I have some questions regarding the implications of what DOT is proposing. First, as you know, most travel advisors are independent contractors (ICs) of host agencies, so is the IC responsible or the host?
A: Under the Federal Aviation Act of 1958, travel agencies are called “ticket agents” and reimbursement obligations apply to “ticket agents.” The term is defined as “a principal or agent who sells; [or] Offers for sale … Air transport The word “person” means an individual or a legal entity.
Note that the definition is not limited to ARC or Iatan nominees and is not limited to the ticketing entity. Rather, it refers to anyone who “sells” air travel. Therefore, the rebate tax could certainly apply to the IC as a seller, even though the DOT requires it to apply only to the officially designated entity that is the host. Perhaps the DOT will address this issue in the final rule.
Question: Second, I understand that the rule applies to all US airlines as well as travel to the US or foreign airlines.If a foreign airline goes out of business and shuts down without refunds, would the agent really be on the hook for a refund?
A: Yes. The travel agent and the airline are jointly liable, which means that if the airline has no money and can’t refund, the agent has to refund.
Q: Third, if the airline does not refund the required amount, when does the agent have to pocket the amount?
A: When a refund is issued due to a cancellation or long delay and the passenger refuses to receive credit for future travel, the carrier has seven days to issue a credit card refund and the passenger has 20 days to issue a refund. check or other amount of money. The same deadlines apply to delegates. I understand that the result is meaningless because the agent doesn’t know if the carrier issued the refund until the deadline has passed.Maybe the DOT will address this issue.
Q: Fourth, if the agent makes a refund, what is the method of payment by the airline?
A: There is no method. If a ticket is currently non-refundable, the agent is not allowed to refund the money. Presumably, that limit will change if the DOT rule goes into effect, but if the airline disagrees with the agent’s decision, the agent has no choice.
Q: Fifth, if the law is passed, won’t most agents just stop selling airline tickets?
Answer: I have no doubt that even if the rule is not in the public interest, it will have such an effect.
Mark Pestronk is a Washington-based attorney specializing in travel law. Email him to submit a request for legal briefs [email protected]
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