Q: With all the fines imposed by the U.S. Department of Transportation (DOT) on travel agencies in 2013 and 2014, I am very worried about being caught up in the DOT dragnet. Is the DOT still making test calls to travel agencies? If not, do you think that it will start them again? I find the rules very complicated and ambiguous, and apparently the DOT interprets the rules differently from the actual wording, which is still more confusing. Can you please break them down into simple commands that my staff can memorize?
A: In the last year alone, according to my informal count, the DOT's fines against agencies, tour operators and consolidators totaled an astounding $869,000 in the 12 months ended May 31. The average fine was $62,000, and the lowest was $26,000, although half the fine is usually forgiven if the agency behaves for one year.
I don't think that the DOT is making test calls any more, but it may start up again. For certain, the DOT is patrolling the Internet to look at advertising violations of the full-fare rule, and competitors probably turn in violators for DOT enforcement.
There once was a TV show called "8 Simple Rules for Dating My Teenage Daughter," and although I never saw the show, its name inspired me to draft simple rules for avoiding DOT fines. So that every front-line agent can understand the rules, here are my Eight Simple Rules for Avoiding DOT Fines.
Rule 1: You must quote airfares (by phone, email, in-person and in ads) by starting with the full price, including all taxes and fees, such as your transaction fee per ticket. You may then break down the full price into fare and fee, if you wish. The rule applies to you regardless of whether you or another entity issues the ticket.
Rule 2: In print (in ads and written offers or quotes), the full price must be more prominent than any breakdown.
Rule 3: For online bookings by corporate clients, Rule 1 does not require you to include your fee in the total quoted in the display.
Rule 4: Rule 1 applies to the total price of any package that includes air as a mandatory component, such as a cruise line's air-sea package.
Rule 5: For a ticket -- or a package that includes air as a mandatory component -- you must obtain the client's written (or recorded oral) consent to any price increase before a deposit is taken. After final payment, you cannot increase the price unless it is for taxes.
Rule 6: In a package that includes air as a mandatory component, you may not require the client to opt out of nonmandatory components like travel insurance. However, you can include any non-opt-outable component in the total price, and of course, you can offer a component as an add-in option.
Rule 7: You may not quote or advertise a one-way fare if a roundtrip is required.
Rule 8: When you offer codeshare flights by phone, email, in-person or in an ad, you must disclose three things during the first quote: the marketing carrier's name, the operating carrier's legal name and the operating carrier's business name.
The DOT has other rules affecting agencies, but these are the ones for which it has been fining agents.
Mark Pestronk is a Washington-based lawyer specializing in travel law. To submit a question for Legal Briefs, email him at [email protected].