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Travel News

ARTA to file complaint about credit card fees

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Written by editor

A GDS product advisory, which indicated that certain IATA tax, fee, charges (TFC) codes will be used “initially for the collection of credit card surcharges in selected markets,” is cause for concern,

A GDS product advisory, which indicated that certain IATA tax, fee, charges (TFC) codes will be used “initially for the collection of credit card surcharges in selected markets,” is cause for concern, according to the Association of Retail Travel Agents (ARTA).

On August 5, 2009, Travelport issued a product advisory to its Worldspan customers announcing that these fees will be collected in various GDS transactions, that they will be for credit card surcharges/fees, and that they will be non-refundable, among other attributes.

“This certainly raises concerns that various industry distribution and settlement systems, including GDSs, may have been directly involved in conversations and agreements with one or more carriers to program for this functionality. It would be highly unlikely that such major system enhancements would be made at the behest of a single carrier,” said Alexander Anolik, legal counsel to ARTA.

ARTA is concerned that with such functionality in place, the way may be paved for ARC and/or the GDS themselves to become credit card merchant processors with the financial support of both airlines and travel agents. What would be a reduction of processing costs for airlines would become a new cost for agencies.

ARTA also expressed concerns that a proposal to use a TFC for the optional collection of agency service charges, as part of the e-ticket transaction, was thumbed down by ARC carriers which sit on the Joint Advisory Board-Agent Reporting Agreement due to “resources, staffing, and facilitation issues.” Yet, surprisingly, there seem to be no such issues raised about collecting similar fees as part of the ticket sale when the beneficiary is the airline.

ARTA will file a complaint this week with the US Department of Justice to investigate whether or not airlines were provided with opportunity and venues to jointly discuss plans to facilitate the collection and intent to impose such credit card charges.