DOT Withdraws Obama-Era Airline Distribution Inquiry

The original article is posted here.

The U.S. Department of Transportation last month withdrew an Obama-era initiative to review airline distribution practices with public input from industry and consumer stakeholders. DOT in October 2016 launched the request-for-information initiative to examine “whether airline restrictions on the distribution or display of airline flight information harm consumers.”

The inquiry drew thousands of public comments, but the RFI was suspended shortly after the Trump administration took the reins of the executive branch.

After sitting idle for years, DOT last month formally withdrew the RFI, as it “does not consider its involvement at this time to be necessary to prevent unfair, deceptive, or anticompetitive practices.”

The inquiry was not officially tied to a rulemaking, but airlines for years opposed the RFI on concerns that it opened the door for new regulations on third-party distribution.

DOT in 2016 launched the RFI at the urging of online travel agencies, metasearch operators and distribution players, according to the department.

Champions of the RFI at the time expressed concerns about “airline restrictions on the distribution and display of airline flight schedule, fare, and availability information,” according to DOT. “Specifically, concerns were raised about practices by some airlines to restrict the distribution and/or display of flight information by certain online travel agencies, metasearch entities that operate flight search tools, and other stakeholders involved in the distribution of flight information and sale of air transportation.”

In its notice of withdrawal last month, DOT wrote: “The issue of airline restrictions on the distribution or display of airline flight information on third-party travel websites is a complex issue with far-reaching implications for consumers, airlines, ticket agents and the various participants in the distribution chain.”
While DOT “recognizes that transparency is not only good for consumers but also good for competition in the airline industry,” its withdrawal notice stated that it “also believes that airlines should be able to choose how and where they sell their products so long as they do not engage in unfair or deceptive practices. These two goals are not mutually exclusive.”

DOT in recent weeks separately finalized a rule championed by airlines that codified the regulatory body’s definitions of “unfair and deceptive practices.” This brought DOT’s guidance in line with the Federal Trade Commission’s, but left consumer advocates concerned about diminished regulatory oversight.
When DOT asked the public in 2017 to flag regulations or other department actions ripe for review or repeal, airlines seized on the opportunity and several asked DOT to withdraw the RFI.

Back then, the International Air Transport Association saw the RFI as little more than an attempt by third-party sellers to get DOT to “intervene in the marketplace via a government mandate that airlines continue to use their antiquated distribution platform.”

United Airlines called the RFI “nothing more than a fishing expedition to gather proprietary airline data and an ill-conceived initial step toward regulating airline online distribution practices in the future.”

American Airlines, meanwhile, in 2017 comments with DOT feared the RFI “may be a precursor to future Department regulation of the terms on which airlines distribute their fare, schedule, and availability information to online travel agencies and to metasearch entities.”

Advocates of the RFI, however, said they sought clarity on airline practices and a review of the access of third-party sellers to airline fare and ancillary data.

Representing online travel agencies, global distribution systems, metasearch operators and other travel distribution outlets, The Travel Technology Association had been a proponent for the DOT review.

“The issue in this proceeding, contrary to the views of certain airlines, is not requiring airlines to do business with those with which they do not wish to do business, but rather whether airlines can lawfully impose restraints on the re-distribution of basic airline fare data, which is not protected under U.S. copyright law,” Travel Tech wrote in comments with DOT several years ago.

Regarding the withdrawal of the RFI, executive director of Travel Fairness Now Kurt Ebenhoch last month stated: “To the detriment of consumers, DOT has adopted the airline industry’s misleading and distracting talking points on how the debate is about where airlines sell their product. The facts are that this is about consumer access to publicly available airfare and airline schedules that use public airspace, airports, air traffic control management resources and runways.”

Travel Fairness Now is a self-described “non-profit coalition of travelers advocating for greater transparency, competition and fairness in travel.” The entity does not disclose financial ties, but confirmed its funding comes from individual donors and unnamed travel websites.

Speaking with The Beat, Ebenhoch said Travel Fairness Now was reviewing the possibility of getting the incoming Biden administration or members of Congress to reconsider the review, but acknowledged a “crowded agenda” for the incoming DOT.