Update on IFTTA News

• German Court challenges EU Regulation on security standards for passports and travel documents; 
• UK: airlines to include debit card surcharges in headline prices;
• Canada: Transportation Agency decides in flight cancellation and overbooking cases; 
• Germany: lugagge to be carried on a later flight is no legitimate reason to deny boarding; 
• Denmark: passengers of a cancelled flight entitled to rerouting at the earliest opportunity; 
• New Body Scanners at Scottish Airports; 
• Netherlands: new reference for ECJ preliminary ruling regarding air passenger rights; 
• German Supreme Court: no compensation for flight cancellation caused by strike; 
• EU Economic and Social Committee publishes opinion on passenger rights in all transport modes; 
• Egypt: new tourism minister appointed; 
• IFTTA Law Review 2-2012 available online; 
• USA: DOT fines companies for violating Consumer Protection and Price Advertising Rules; 
• UK: Bad Taste Tweets Not Criminal; 
• USA: Airlines lose appeal against DOT fare rules;
• EU Commission publishes consumer tips for visitors to the 2012 Olympic Games; 
• UK and Unfair Contract Terms Reforms; 
• CJEU: inclusion of flight cancellation insurance as a default setting unlawful when selling air tickets over the internet;
• UK: British Airways to check passengers on Google?; 
• Austria: regulation on proper rail passenger behaviour; 
• USA: new law to require airlines to seat families together?; 
•  Scottish Jurisdiction over Shetland; 
• Austria: Appelate court decides on "fly all or pay up" clauses; 
• Spain: Court of Appeal of Barcelona regards Ryanair's boarding pass printing policy lawful; 

Most recent postings on IFTTA News

• USA: airlines ask DOT for another delay in new rules;
• USA: no private right of action pursuant to Air Carrier Access Act;
• UNESCO recognizes Aceh’s Saman Dance as Intangible World Heritage
• Scotland: Human Trafficking Report;
• EU: Commission requests Italy to comply with new safety rules for passenger ships;
• Taiwan: Hong Kong Dragon Airlines accused of discrimination;
• European Commission updates airline black list;
• New EU-US agreement on PNR;
• USA: DOT fines Spirit Airlines for deceptive price advertising;
• European Union: new rules on the use of security scanners at European airports;
• European Union: new Directive on Consumer Rights published in Official Journal;
• IFTTA Europe Workshop Website Online;
• Cruise conference - May 21-23, 2012;
• UK: OFT takes next procedural step in airline fuel surcharges case;
• USA: DOT issues first fine for tarmac delay rule violations;
• India: tiger reserves may ban tourists;
• Court of Cassation (FR) on Deep vein thrombosis;
• UNWTO: European tourism grows above expectations;
• European Consumer Centre Network launches Air Passengers Rights Report 2011;
• USA: DOT fines Caribbean Airlines for improperly limiting reimbursements for delayed baggage;

Update on IFTTA news

The following news have recently been posted to the IFTTA Website:

• USA: DOT fines Orbitz for violating price advertising rules
• ECJ Advocate General delivers opinion on EU Emissions Trading Scheme
• Irish High Court confirms exclusivity of Montreal Convention with respect to international air carriage
• Scottish Legislation to Tackle Football Sectarianism
• Germany: yet another reference for preliminary ruling challenging "Sturgeon"
• European Court of Justice: "Cancellation" also covers discontinuation of a flight
• Kenya: tourism minister issues open letter regarding piracy
• UK: Office of Fair Trading received super-complaint about travel money
• European Commission publishes results of the Online ticket Sales Sweep
• Seychelles: Sustainable Tourism Label announced
• USA: DOT fines Virgin Atlantic for deceptive online advertising
• USA: Travel Association and ATA support new Visa legislation
• World Travel & Tourism Council addresses governments on World Tourism Day
• France to impose new tax on luxury hotel rooms
• USA: DOT to require airlines to make their websites and kiosks accessible to disabled travelers
• Conference: EU Passenger Law – Towards 2020, Leuven
• Interesting case! Preliminary Ruling: ECJ C-410/11
• Austrian Supreme Court: hotel liable for theft from safe in hotel room

Canada: class action against Air Canada over price disclosure

A motion filed on July 16, 2010 by Union des consommateurs du Québec against Air Canada (proposing that the action cover all residents of the province of Québec who have purchased tickets directly from Air Canada since June 30), alleges that Air Canada failed to disclose the complete price of its tickets in its paper and electronic advertisements as well as on its website.; in particular additional charges such as airport improvement fees and 9/11 security charges were added to the advertised prices.

The motion claims for reimbursement of all fees and charges paid beyond the advertised price and the payment of $100 in punitive damages for each affected consumer.

Source: Union des consommateurs du Québec (French)

USA: DOT fines AirTran and Delta for price advertising rule violations

The U.S. Department of Transportation (DOT) assessed civil penalties against AirTran Airways and Delta Air Lines for violating rules that require airline price advertisements to disclose the full price consumers must pay for air transportation. The action against AirTran resulted from it advertising a fare that was not available, the action against Delta involved the carrier’s failure to provide adequate notice of taxes and fees that were not included in certain base fares at the first point they were advertised on its website. AirTran was fined $20,000 and Delta $40,000.

Source: travelpulse; find article here>>.

Australia: Federal Court rules agains Qantas in fuel surcharge case

Australian Federal Court today ruled the fuel surcharge the airline charges passengers is not a tax, but simply part of the fare. Qantas will therefore be made to repay years of disputed commission fees to travel agents of tens of millions of dollars at least.

The court upheld an appeal by Leonie's Travel, forcing airlines to include the fuel surcharge in their base figure for calculating commissions paid to agents. The case will now return to the original judge to determine how much Qantas owes the agents.

Source: The Sidney Morning Herald; find article here>>.

Full text of Fedreral Court Judgement Leonie's Travel Pty Ltd v Qantas Airways Limited

[2010] FCAFC 37 available here>>.

German Supreme Court: flexible pricing in travel brochures admissible

A German association combatting unfair competition sued TUI for not publishing final prices in travel brochures. TUI had published prices with the reservation of a revision of EUR 50 up or down applying to each flight route. The association saw an infringement of pricing rules requiring indication of a binding price.

German Supreme Court (BGH) in judgement I ZR 23/08 - Costa del Sol, of April 29, 2010, however, deemed the reservation to be admissible because of the limitations in range and reasons of potential revision as well as because of a clear reference to potential price changes until conclusion of the contract. Such reservation would allow tour operators a certain fexibility in printed brochures which was a matter of course in internet trading.

Source: BGH press release 92/2010 of April 29. 2010; full text available in German here>>.

Obviously BGH saw no cause to file a reference for preliminary ruling with regard to the interpretation of Art. 3 para 2 PTD.

German Supreme Court decides on cross-ticketing

German Supreme Court (BGH) in today's judgment Xa ZR 5/09 decided that airlines must not declare a ticket void if the flight coupons are not used in their correct order. Such provisions are widely used in general conditions of contract of several airlines to prevent passengers from booking flight segments which they actually don't want to use in order to benefit from a lower price.

In the particular case the German Federal Consumer Protection Association (Bundesverband der Verbraucherzentralen) had sued British Airways and Lufthansa to cease and desist from using such provisions.

BGH acknowledged a legitimate interest of the airlines to avoid evasions of their tariff systems; this purpose, however, could also be achieved by milder means as for instance a surcharge for not having used a coupon for a flight segment. To completely ban the passenger from further contractual services would be disproportionate and against the principle of good faith as the provisions at stake made no distinction on whether the passenger deliberately booked more segments than required or left coupons unused for justified reasons.

Source: BGH press release 91/2010; full text available in German here>>.

UK: consultation on creating new consumer right

Altough Consumers are protected from traders' misrepresentations and unfair dealing by the Consumer Protection from Unfair Trading Regulations, which implement EU law, they cannot take direct action under these Regulations. The Law Commission and Scottish Law Commission are therefore reviewing whether or not consumers should be able to take direct action against retailers who treat them unfairly. It has asked consumers and businesses if the action would be too severe.

Source: out-law.com; find article here>>.

USA: new legislation requires disclosure of airline fees

The Federal Aviation Administration reauthorization bill, passed by the Senate earlier this week, contains a new provision that would require airlines and online travel agencies to clearly disclose all fees associated with the cost of a ticket, including holiday surcharges, baggage fees and seat assignments.

The bill also includes the Passenger Bill of Rights, which mandates that aircraft cannot remain delayed on the tarmac for longer than 3 hours before having to return to the gate. Alternatively, the rule allows the airline to send buses to take passengers off the plane so the aircraft doesn't lose its place in line to take off.

In response to recent plane crashes, the bill also

• tightens pilot hiring, testing, training, and rest requirements for large and small airlines
• bans the use of personal electronic devices in the cockpit

The F.A.A. reauthorization bill now has to go into conference committee and be reconciled with the House version of the same bill.

Sources: New York Times "In Transit" Blog; find article here>>.
eTurboNews; find article here>>.

USA: DOT fines US Airways for fare ad violation

The U.S. Department of Transportation (DOT) has assessed a $40,000 civil penalty against US Airways for violating rules that require airline price advertisements to disclose the full price consumers must pay for air transportation.

The DOT's Aviation Enforcement Office found that when consumers searched US Airways' website for one-way flights sorted by schedule, the airline provided a set of fares that did not include additional applicable taxes and fees or any notice on that page that the additional charges would be required. Under DOT’s requirements for Internet advertising displays, the full fare must either be listed on the first screen that provides fare quotes, or the existence of additional government-imposed per-passenger charges must be prominently disclosed along with a hyperlink that takes consumers to a page that describes the additional charges.

The consent order is available on the Internet at www.regulations.gov, docket DOT-OST-2010-0005.

Source: DOT press release 44-10 of March 8, 2010

Austria: city trips offered in conncetion with a student exchange programme do not constitute a "package"

Defandant, an Austrian association organising international student exchanges including free accomodation with host families, was offering a 6 day city trip to New York for students participating in the exchange programme in the U.S. and a 3 day city trip to London for students participating in the exchange programme in U.K. The trips included accomodation, sightseeing and recreational activities as well as workshops to prepare the students for their stay in the respective country. The trips were offered at fair market value. Defandant also offered flight tickets in connection with said trips.

Plaintiff, an Austrian association to combat unfair competition, filed a law suit requiring defendant to cease and desist from

• pursuing travel business in connection with international student exchanges by offering city trips of several days duration, including transportation, accomodation and other tourist services (sightseeing) beyond the period of school attendance or stay with host families at an inclusive price and thus organising packages without tour organiser licence and/or insolvency coverage and/or
• pursuing travel business in connection with international student exchanges without travel agency licence by providing flight tickets from/to Austria and/or within country of destination.

Court of first instance (Handelsgericht Wien) and court of appeal (Oberlandesgericht Wien) both granted the claim.

Upon further appeal by defendant, Austrian Supreme Court (OGH)

• revised the judgements and dismissed the claim in regard to package tours
  
• repealed the judgements remanding the case to the court of first instance in regard to flight tickets.

Supreme court referred to ECJ judgement C-237/97 - AFS in which ECJ had held that Council Directive 90/314/EEC of 13 June 1990 on package travel, package holidays and package tours did not apply to travel

• comprising student exchanges of about six months' or a year's duration;
• the purpose of which is attendance by the student at an educational establishment in the host country in order to familiarise himself with its people and culture; and
• during which the student stays with a host family as if he were a member thereof free of charge.

The city trips offered could not be regarded in isolation from the exchange programmes as they were not offered separately but only in connection with same. As the trips also served the purpose to prepare the students for their stay in the host country and the style of living there, neither the exchange programmes themselves nor the city trips as parts of these programmes could be regarded "packages" in the meaning of Dir. 90/314/EEC.

Concerning the flight tickets, Supreme Court considered defendants objection that the tickets were organised and issued by a licenced travel agent. As there were no findings on who really organised and issued the tickets, in further proceedings court of first instance will have to take evidence in this regard. If it turned out that they were indeed organised and issued by a licenced travel agent, defendant could have a strong argument to have acted based on a justifyable legal opinion.

Full text of judgement 4 Ob 70/09m of Nov. 19, 2009 available in German here>>.

USA: another law suit filed by former YTB affiliates

A number of former affiliates filed a third version of their complaint against YTB in the U.S. District Court for Southern Illinois. The former YTB referring travel agents (RTAs) have charged they were induced to join an illegal pyramid scheme. They claim current and former affiliates have suffered damages of more than $100 million. In two cases brought previously they have not convinced Judge Patrick Murphy that the charges can be based on a consumer protection law because the case involves business-to-business dealings.

Source: Travel Weekly; find article here>>.

Also see previous postings of June 10, 2009 and May 19, 2009.

USA: DOT ruling against airline pricing mistakes

British Airways last month published an unusually low fare from the United States to India. The base was $40 round trip. Although BA doesn't include its $370 fuel surcharge in that amount but passes it on as a "tax" rather than as part of the ticket price, and the actual taxes were an additional $150, the total $560 was still several hundred dollars less than a regular advance-purchase fare to India.

The fare stayed on the market only for one day, but that was enough time for hundreds of tickets to be purchased. Three days later, BA unilaterally canceled all those tickets because a mistake had been made.

The U.S. Department of Transportation (DOT) said it conducted a full investigation over the cause, magnitude and consequences of this incident and determined that BA's unilateral cancellation had caused financial harm to a large number of consumers.

The Department ruled that British Airways should compensate affected consumers - which BA agreed to do - but refused to force British Airways to restore the canceled tickets.

Sources: The Washington Times; DOT press release 183-09

Germany: German courts have jurisdiction over airlines in other member states in regard to unfair terms

In a decision dated July 9, 2009, German Supreme Court (BGH) held that German Courts have jurisdiction over over an airline in another member state in regard to a law suit filed by a consumer protection association to cease in order to interdict the use of unfair terms in General Conditions of Contract.

However, whereas with regard to such infringement of consumer interests, the law of that state applies in which due to the statement of claim collective consumer interestes have been affected, validity of such General Conditions of Contract was subject to the law governing the contract.

BGH decision Xa ZR 19/08 of July 9, 2009 available for download in German here>>.

European Union: Commissioner Kuneva welcomes new report on airline charges

The report, which will be presented by the Norwegian Ombudsman Bjørn Erik Thon, is the result of a year long investigation by 11 national enforcement authorities (led by Norway). The in-depth study found that airlines are frequently including parts of their basic operational costs (handling charges, fuel charges, booking fees) into what appears to be obligatory "taxes and charges" – this can mislead consumers and falsely attract consumers to buying seemingly cheaper tickets.

The study covered 281 flights, 24 leading European airlines, as well as 34 major European airports.
The results of the investigation will feed into the industry agreement currently being elaborated following the EU enforcement sweep on airline ticket selling websites (see IP/09/783).

Source: Press release by Commissioner Kuneva; report on airline charges available here>>.

European Uniton: Commission alerts consumers to the importance of sun protection

At the start of the holiday season, the European Commission alerts consumers to the importance of adequate protection from the sun this summer and reminds them to look out for the clearer labelling regime on sunscreen bottles. The new labels - including a new UV-A logo or seal on bottles and a ban on misleading terms such as "sun blocker" or "total protection" - are a response to a Commission recommendation on sunscreen products adopted in September 2006. The Commission is also seeking to remind consumers that there are several reasons why sunscreen products should be only one out of a number of measures which are necessary to protect from the UV radiation of the sun.

Source: European Commission press release; find full text here>>.

USA: travel agents' class action against YTB partly dismissed

Although the U.S. District Court in Illinois did not dismiss the case outright, it granted parts of YTB’s motion to dismiss a class action brought against the multilevel marketing travel company by former referring travel agents, who charged that YTB operated an illegal pyramid system.

The court dismissed allegations against YTB subsidiary Rezconnect and its CEO, Michael Brent, on grounds that the court did not have jurisdiction over the New Jersey-based business.

Source: Travel Weekly; find article here>>.

Illinois: another law suit aganist YTB

The Califonia law suit was barely setteled when Illinois Attorney General Lisa Madigan filed a similar law suit against YTB: again YTB is charged with operating an "unlawful pyramid sales scheme." Illinois charged that YTB violates the state’s Consumer Fraud Act by misrepresenting that it is a travel agency "when in fact the primary function of the business is building a downline." Illinois is seeking civil penalties of $50,000 for each violation of the Consumer Fraud Act.

Source: Travel Weekly; find article here>>.

European Union: Airlines move to clean up ticket selling websites

New EU results published yesterday show a "step change" in airline ticket selling websites across Europe in terms of compliance with consumer protection rules. The findings feature in a final report on an 18 month EU-wide process to crackdown on misleading advertising and unfair practices. As a result of an EU enforcement investigation started in September 2007 – with 15 EU national authorities and Norway - 115 airline websites out of the 137 websites investigated have been corrected. Following an additional "health check" process involving independent mystery shopping in March 2009 on 67 major airlines, 52 airlines have either been given a "clean bill of health" and undertaken to maintain the same standards or immediately responded to the Commission's consultation with undertakings to remedy outstanding issues. The health check process checked websites against a comprehensive 14 point checklist, which was previously agreed with the airline industry. The Commission is now working to put in place an industry wide agreement to provide a level playing field for airlines across the EU and to maintain sites to a high standard.

Source: EU press release IP/09/783; find full text here>>.