U.S. Department of Transportation calls for fee transparency from airlines, OTAs

The U.S. Department of Transportation is proposing a rule to require airlines and travel search sites to disclose certain fees beyond the base fare up front.

The proposal is intended to add transparency to the process of searching for and booking travel and would affect U.S. air carriers, foreign air carriers and third parties such as online travel agencies and metasearch sites that display fares for flights to, from and within the United States.

“Airline passengers deserve to know the full, true cost of their flights before they buy a ticket,” says U.S. Transportation Secretary Pete Buttigieg. 

“This new proposed rule would require airlines to be transparent with customers about the fees they charge, which will help travelers make informed decisions and save money.”

The Travel Technology Association, representing brands including Expedia, Kayak, Skyscanner, Booking.com, Skyscanner, Travelport and Amadeus, says it supports the proposed requirements.

“Consumers, specifically ones that travel only once or twice a year, often are not aware of what products and services are included with their airline tickets. Airline models differ from airline to airline where some do not charge extra for bags or seats while others do, and prices can range significantly,” says Stewart Alvarez, interim president and CEO of the association.

“Additionally, seats can be available at the time the airline ticket is purchased by the consumer and a few days or weeks later may not be, making it difficult for a family traveling to sit together.”

The rules would require that upfront, the first time an airfare is displayed, any fees for a traveler to sit with their child, for changing or cancelling a flight and for checked or carry-on baggage must also be shown. The fees would be required to be displayed as passenger-specific or itinerary-specific based on the consumer’s choice.

The department is also proposing that airlines be required to enable consumers traveling with a young child to purchase seats with the fare at all points of sale. And it requires airlines provide “useable, current and accurate information regarding baggage fees, change fees, cancellation fees and adjacent seating fees for families traveling with young children, if any, to ticket agents that sell or display the carrier’s fare and schedule information.”

In Monday’s White House press briefing, the White House press secretary, Karine Jean-Pierre, says the proposal is intended to “spur competition among airlines, expose and limit airline fees and most importantly save money for American families.”

In the first two quarters of this year, according to the U.S. Bureau of Transportation Statistics, U.S. airlines collected more than $3.2 billion in baggage fees. The government also says airlines made nearly $700 million from cancellation and change fees in 2021. 

This proposal is the latest action in a series of protections for travelers the Department of Transportation has announced recently, in response to President Biden’s Executive Order on Promoting Competition in the American Economy.

Earlier this month the department unveiled a new airline customer service dashboard to help travelers understand their rights when flights are cancelled or delayed. The department is also proposing to require more clarity on when a traveler is due a refund and to require non-expiring credits when people choose not to travel due to having COVID or another communicable disease.

President Biden announced the proposed rule Monday at a meeting of the White House Competition Council, which was established last year.

The public will have 60 days to comment on this proposal before it can be finalized, but it is unclear how long it may take to put the rules in place.