Hanging agents out to dry

A PLAN by the United States to mandate travel agencies provide cash refunds out of their own pockets if an airline cancels or delays a flight has been labelled a “worrying development” by Australian Federation of Travel Agents (AFTA) CEO Dean Long.

The US Department of Transport (DOJ) has tabled new regulations making agents equally responsible with airlines for delivering refunds on air tickets, regardless of whether the advisor is in possession of the funds.

The US DOJ said it is proposing to codify its “long-standing interpretation that it is an unfair business practice for a US air carrier or a ticket agent to refuse to provide requested refunds to consumers when a carrier has cancelled or made a significant change to a scheduled flight”.

The proposal will also seek to hold agents responsible for providing non-expiring travel vouchers or credits to consumers when flights are unable to be taken due to “a serious communicable disease”.

AFTA’s chief said the proposal in the United States, which is yet to be ratified, showed that some international regulators clearly don’t understand how the fundamentals of the international travel sector operates.

“Where the ultimate supplier has been provided with the payment, it is their responsibility to hold these funds, if they do not provide full refunds in accordance to their terms and conditions, they are responsible for returning the funds,” Long said.

Encouragingly, he added that he was not aware of any plans in Australia to follow the USA’s lead on the issue, adding that AFTA’s efforts over the last 30 months in educating state, territory and federal governments about how the supply chain works for agents will need to continue to ensure “these types of ideas do not gain transaction in Australia”.

“This type of regulation demonstrates the ever-growing importance of the advocacy work AFTA undertakes to ensure the regulatory remains open and fair for all stakeholders,” Long said.