by Donald Wood
Last updated: 12:40 PM ET, Wed August 7, 2024
Members of Congress sent
a letter last week to the United States Department of Transportation (DOT) voicing
their concerns about how the updated airline refund policies could negatively impact
travel agents.
At the recommendation of the American Society of Travel
Advisors (ASTA), five members of Congress issued a letter of recommendation to DOT
Secretary Pete Buttigieg regarding “concerns that the final rule requiring
merchant of record travel agencies to provide a refund to the customer if the
flight is cancelled or significantly changed would have significant negative
consequences on small businesses that sell airline tickets.”
“We have been hearing significant concerns on the impact
from many of our constituents in the travel advisor industry that the impact of
this rule as written will have unintended negative consequences,” the letter to
Buttigieg said.
“For example, businesses specializing in large group
bookings with comprehensive and complex itineraries can spend tens of thousands
of dollars on airline tickets per booking,” the letter continued. “They simply
do not have the capital to provide airline refunds to clients without first
receiving the funds from the airline. This can and will affect their bottom
line, and in some instances, could put their small businesses at risk.”
While the DOT responded by issuing
a final rule stating that air carriers must “promptly transfer the funds to
the ticket agent,” ASTA representatives said the ruling does not address
whether the ticket agent's obligation to refund the consumer begins when the
ticket agent receives the funds back from the carrier.
The ASTA said it would continue “conversations with DOT to
ensure we understand its interpretation of the new rule and will provide
further updates to our members when we have more information.”
Earlier this month, Buttigieg issued a letter to the CEOs of
the 10 largest airlines in the U.S. to reinforce the need to provide customers
with cash
refunds when appropriate. The DOT outlined for U.S. carriers that refund
requirements in the FAA Reauthorization Act took effect on May 16, 2024.
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