ASTA tells DOT refund rule just won't fly

Proposed regulations before the Department of Transportation that would make travel agencies responsible for ticket refunds, regardless of whether they possess the funds, are “manifestly unfair,” ASTA told the DOT this week.

ASTA’s senior vice president and general counsel Peter Lobasso filed comments with the DOT’s Office of Aviation Consumer Protection on Wednesday on behalf of the Society’s membership base, more than 17,000 agencies, travel advisors and supplier companies.

“While we share the department’s goal of ensuring consumers get the refunds they are entitled to when an airline cancels a flight, putting travel advisors ‘on the hook’ for issuing those refunds is the wrong way to do it,” ASTA CEO Zane Kerby said in a release. 

“In fact, it will negatively affect consumers in the long run as the financial risk associated with its proposal may lead agencies to stop selling air tickets altogether, depriving consumers of the valuable consultatory services and comparative shopping options advisors provide,” Kerby continued. “We urge the DOT to make the changes we’re suggesting.”

In his Travel Weekly Legal Briefs column, industry attorney Mark Pestronk called the regulation “the most anti-travel-agent regulation in [the DOT’s] history.”

In the filing with the DOT, Lobasso urged the DOT to decline any requirements that advisors provide consumers with refunds in the case of canceled or significantly changed flights.

“Indeed, in many circumstances, holding ticket agents to the same standard as the airlines with respect to refunds will prove to be not only unworkable from a regulatory perspective but manifestly unfair as well,” Lobasso wrote. 

Travel agents are considered “ticket agents” under the federal statute.

ASTA suggested the DOT instead limit an agent’s obligation to assisting the consumer in securing their refund from the carrier. 

If that isn’t possible, the Society suggested limiting the times an agent would be required to issue a refund to when the agent is the merchant of record for the transaction, has received notice from the airline that the passenger is entitled to a refund and is in possession of the consumer’s funds.

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