ASTA says a new U.S. funding bill for the Federal Aviation Administration is a “gross” move that leaves agents potentially vulnerable to massive payments.
As part of an FAA funding bill passed last week, the association had proposed a measure that would counter a new U.S. Transportation Department rule requiring ticket agents to pay refunds when they are the merchant of record for a ticket, even when airlines possess the money. ASTA had proposed that the U.S. Senate bring in a rule that would have prevented advisors for being on the hook, but the measure didn’t pass.
“Time and time again, we’ve heard politicians in Washington give lip service to small businesses. Travel agencies are not positioned to float the kind of financial obligations that policymakers are strapping on their backs,” said Zane Kerby, President and CEO of ASTA.
“Consumer protection could have been accomplished without sacrificing the interests of small business travel advisors who work diligently every day on behalf of the travelling public,” he said in a statement on the ASTA website.
ASTA said that in both the regulation and the legislation, “ticket agents” were painted with a broad brush, and that not all ticket agents are created equal. The ability of a large OTA to repay an airline refund is vastly different from a third-generation retail travel agency, it argues.
“Those household name OTAs are resourced with billions more dollars than our retail agencies, 98 percent of which are small businesses,” Kerby said. “Airlines have been bailed out by Congress over and over, and they are now looking to travel agencies to serve as their bank, paying their customers with no onus to repay the agencies.
“Requiring advisors to extend credit from their own pockets to pay airline refunds is a gross misplacement of responsibility that must be rectified. Congress failed in its duty to protect Main Street from monolithic airline corporations,” he said.
“In the end, the consumer suffers, as travel advisors will be less inclined to book airfare, leaving the flyer without an advocate when travel plans go south.”
The U.S. House of Representatives will have until 17MAY to pass the measure and send it President Joe Biden for a signature.
Travel advisors will meet with lawmakers this September for ASTA’s annual Legislative Day. This will be the first item on the agenda in those congressional meetings. Travel advisors will want to know how their lawmakers plan to address this significant oversight, ASTA said.
