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News Digest

DOT 130-12
 

News Digest

DOT Revises Policies on Approval of Public Charter Flights.  The U.S. Department of Transportation (DOT) has revised its policies for approving public charter programs in order to prevent the kind of harm to consumers that took place when the charter operator Direct Air ceased service in March.  Public charters operators, which sell charter flights to the general public, must comply with specific DOT consumer protection requirements.  These include spelling out passengers’ rights in an operator/participant contract that consumers sign when purchasing a trip, requiring payment by check or credit card to facilitate refunds, requiring early notice of cancellations, and requiring that a charter operator have a surety agreement and an escrow account to hold passenger payments until the specific flights purchased operate in case it must provide refunds.  Under the new policies issued today, the Department will reject public charter filings as contrary to the public interest unless they meet specific new conditions.  Charter operators will have to retain control of all passenger reservation records and share them with the airline to make it easier to identify and contact passengers regarding cancellations or return flights for stranded passengers.  Also, for consumers not paying by cash, operators may continue to accept payment by credit card, which provides protection under laws that allow charges to be removed from a credit card bill if a service is not provided.  Carriers may accept debit cards only where similar protections are afforded to purchasers.  Public charter operators may not sell vouchers for future travel that are not associated with specific flights because they are not protected under the charter escrow requirements.  Also, to help ensure that escrow funds are being handled properly, the charter operator will have to show that contracts with the airline providing the flights include the full cost of air service.  The new policy will apply in 30 days.  The notice may be viewed at http://www.dot.gov/airconsumer/guidance-public-charter-prospectuses, and a DOT consumer fact sheet on public charter flights is available at http://www.dot.gov/individuals/air-consumer/plane-talk-public-charter-flights.  DOT is continuing to investigate Direct Air’s shutdown. 

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Wednesday, November 14, 2012