Alexandria, VA, April 25, 2024 – The American Society of Travel Advisors (ASTA) expresses its deep disappointment over the Department of Transportation’s final rule relating to airline ticket refunds. As it reads, merchant of record ticket agents will be responsible to provide consumer refunds regardless of whether they are in possession of the funds from the airline. Despite ASTA’s years’ long effort to educate Congress and the DOT, this final rule indicates a complete lack of understanding for how our predominantly small business community sells airline tickets.
“The Department of Transportation made a profound error in this final rule,” commented ASTA President and CEO Zane Kerby. “Our primary concern for our members has always been the potential that regulations aimed at protecting consumers could harm the small travel agencies who book air tickets. And that is precisely what happened. Travel agencies sold 40 percent of airline tickets in 2023, and the DOT doesn’t understand that in the limited situations where the agency is the merchant of record, payment is immediately passed on to the airline.”
“We agree with DOT that for far too long, consumers have borne the brunt of airline bad behavior. Fortunately, those who use a travel advisor know they have someone in their corner working tirelessly to obtain their refund when travel plans go south. But to put the onus of providing that refund on small business merchants of record will be catastrophic to this industry. Merchant of record transactions make up a significant portion of business for many small agencies in our industry, especially those who specialize in group travel.
“This is a clear case of a federal agency overcorrecting a problem. Now more than ever, we urge leaders in the House and Senate to maintain Section 710 of the House bill to reauthorize the FAA [H.R. 3935] which ensures ticket agents – nearly 80 percent of whom are female small business owners – are not responsible for providing airline refunds when they are not in possession of the funds.”
You can access ASTA’s comments to the original proposed rulemaking here.
On Thursday, May 2 at Noon ET, Peter Lobasso, SVP and General Counsel, will provide ASTA with an in-depth analysis of these regulatory changes. Members can register here.
