Q: We have been reading about the fines that the Department of Transportation (DOT) has imposed on various airlines and travel agencies for violating the full-price disclosure rule. For example, in early August, the DOT fined Pacific for Less $20,000 for advertising a price "plus taxes and fees." Judging by its website, it looks like Pacific for Less is a small or even home-based agency in a town on Maui. Does this mean that the DOT is going to be fining mom-and-pop and home-based agents? We certainly can't afford $20,000, but we don't advertise fares in the newspapers, our website or elsewhere. So are we safe from fines if we do not advertise at all?
A: No, the rule, which went into effect in January, applies to any "solicitation" as well as advertising. Every travel agency that sells air transportation (or a package that includes air as a mandatory component) engages in solicitation, so the rule applies to every such agency.
"Solicitation" is not defined by the rule, but it probably means nothing more than a quote, either oral or written (in an email or otherwise) that is made for the purpose of trying to make a sale. In other words, the rule applies whenever a travel agent quotes an airfare or package including mandatory airfare, including an air-sea package from a cruise line.
The full-fare rule does not apply to online booking engines that are not accessible by the general public; in other words, online booking for corporate clients using Concur, GetThere and the like. Similarly, quotes made to employees of corporate accounts for their business travel may not fall under the rule, but the DOT has not expressly so stated, so it would be prudent to apply the rule to such travel, too.
The full-price rule is not hard to obey. Agency owners and managers need only require that agents remember four things to avoid having your agency get hit with a big fine:
1) When you quote a dollar amount orally or in writing, always begin by stating the total price including all taxes and fees, including your agency's service or transaction fees.
2) When you quote a range of fares, you can say that the fare is "from" and then state the lowest fee, or you can state both the top and bottom of the range, but all of those quotes must include all taxes and fees.
3) Quotes that you get from the GDS or a cruise line, wholesaler, tour operator or consolidator will not necessarily include all taxes and fees, but you must include them in your quote of the full price anyway.
4) After you quote the full price or range of full prices, you may (but do not have to) break down the price and fees, as long as what you say is not inaccurate or misleading, and as long as the font of any written breakdown is smaller than the font of the total price.
The DOT will be looking for violations and might even make mystery-shopper calls or send test emails to see if agencies are violating the rule, and the DOT may be receptive to consumer complaints and whistle-blowing by your competitors. If a small agency in Maui could get hit with a $20,000 fine, so could you.
Mark Pestronk is a Washington-based lawyer specializing in travel law. To submit a question for Legal Briefs, email him at [email protected].