IATA Disappointed with New US DOT ConsumerProtection Rules
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IATA Disappointed with New US DOT ConsumerProtection Rules

The US Government’s Department of Transportation (DOT) has recently announced two new broad consumer protection rules which disappointed the International Air Transport Association (IATA), a global aviation representative group. According to IATA, these new rules may result in a surge in the airfares causing further inconvenience to the passengers and the airline industry altogether. 

IATA has passed a statement that, “the US Department of Transportation’s (DOT) two new broad consumer protection rules by far exceed the DOT’s authority to regulate the deregulated airline industry.

They added, “The Refunds and Other Consumer Protection Rule will force airlines to provide automatic refunds for delays or cancellations, irrespective of the cause of the disruption. The Enhancing Transparency of Airline Ancillary Fees Rule will render online searches less seamless and reduce price competition on optional airline services. These, one size fits all passenger service mandates, will raise airline costs which will ultimately be reflected in higher ticket prices.”

The Final Rule by the US Department of Transportation (DOT) requires US airline carrier or foreign carrier to issue automatic refunds to consumers during any cancellation or flight change to a scheduled flight to, from, or within the United States, or if the airline doesn’t offer any alternatives or if consumer rejects alternative transportation, travel credits, vouchers, or other compensation. 

According to DOT’s new rule, airlines must provide the automatic refunds promptly within 7 business days for credit card purchases and within 20 business days for other forms of purchases. DOT also requires airlines and ticket agents to inform passengers about their right to refund before making an offer of alternative transportation, travel credits, vouchers, or other compensation in the place of refunds to ensure that the passengers are aware of their entitlement to refund.

DOT is also defining the terms ‘significant change’ and ‘cancellation’ for the first time in order to provide consistency and clarity to the consumers about the right to their refund. The department also wants carriers to offer refunds to the consumers for ancillary services for which the passenger paid but didn’t receive, like checked baggage fees in case the bag is delayed significantly. 

If a passenger is unable to or advised not to travel on a scheduled flight to, from, or within the United States due to a serious communicate disease, the carriers must provide them with transferable travel vouchers and credits that is valid for at least 5 years from the date of issue, as per DOT’s new rule. However, airlines must ask for documentation from the passengers proving their reason if not traveling to avail of the travel voucher or credit by the carrier.

However, IATA doesn’t support and is rather disappointed with the new rules announced by DOT as it may lead to loss in airline industry and also result in increased flight ticket fares which may directly impact the industry negatively.

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