99760 Federal Register / Vol. 89, No. 238 / Wednesday, December 11, 2024 / Proposed Rules 

Subject National banks State member 

banks 

State 

non-member 

banks 

Federal savings 

associations 

State savings 

associations 

BHCs & FHCs 

— — — — — SLHCs 

Recordkeeping and Confirmation of Securities 

Transactions Effected by 

Banks.

12 CFR part 12 .... 12 CFR 208.34 

[Reg. H].

12 CFR part 344 .. 12 CFR part 151 .. 12 CFR part 344.

Reporting Requirements for 

Reported Securities Under 

the Securities Exchange 

Act of 1934.

12 CFR part 11 .... 12 CFR 208.36 

[Reg. H].

12 CFR part 335 .. 12 CFR part 11 .... 12 CFR part 335; 

12 CFR part 

390, subpart Q; 

12 CFR part 

390, subpart W.

Securities Offerings .............. 12 CFR part 16 .... .............................. 12 CFR part 335 .. 12 CFR part 16 .... 12 CFR part 335; 

12 CFR part 

390, subpart Q; 

12 CFR part 

390, subpart W.

OCC Regulations: 

Municipal Securities Dealer 

Activities of Banks.

12 CFR part 10 .... .............................. .............................. 12 CFR part 10.

Federal Savings Associations 

Proxies.

.............................. .............................. .............................. 12 CFR part 169 .. 12 CFR part 169.

Federal Savings Associations 

Rules on the Issuance and 

Sale of Institution Securities.

.............................. .............................. .............................. 12 CFR 163.5; 12 

CFR part 163, 

subpart C.

Board Regulations: 

Credit by Banks and Persons 

Other than Brokers or 

Dealers for the Purpose of 

Purchasing or Carrying 

Margin Stock.

12 CFR part 221 

[Reg. U].

12 CFR part 221 

[Reg. U].

12 CFR part 221 

[Reg. U].

12 CFR part 221 

[Reg. U].

12 CFR part 221 

[Reg. U].

12 CFR part 221 

[Reg. U]. 

— — — — — 

12 CFR part 221 

[Reg. U]. 

Credit by Brokers and Dealers............................... .............................. .............................. .............................. .............................. 12 CFR part 220 

[Reg. T]. 

1The Orderly Liquidation Authority subject was included in the chart published on Feb. 6, 2024 (89 FR 8084) but FDIC staff has further reviewed the regulations, 

12 CFR part 380, and believes that these rules are not subject to EGRPRA. This subject has been removed from the chart. 

Michael J. Hsu, 

Acting Comptroller of the Currency. 

By order of the Board of Governors of the 

Federal Reserve System. 

Ann E. Misback, 

Secretary of the Board. 

Federal Deposit Insurance Corporation. 

By order of the Board of Directors. 

Dated at Washington, DC, on November 20, 

2024. 

James P. Sheesley, 

Assistant Executive Secretary. 

[FR Doc. 2024–28939 Filed 12–10–24; 8:45 am] 

BILLING CODE 4810–33–P; 6210–01–P; 6714–01–P 

DEPARTMENT OF TRANSPORTATION 

Office of the Secretary 

14 CFR Chapter II 

[Docket No. DOT–OST–2024–0062] 

RIN 2105–AF20 

Airline Passenger Rights 

AGENCY: Office of the Secretary (OST), 

Department of Transportation (DOT). 

ACTION: Advanced notice of proposed 

rulemaking (ANPRM). 

SUMMARY: The U.S. Department of 

Transportation (Department or DOT) 

seeks public comment on a rulemaking 

to ensure consumers experiencing 

significant flight disruptions are taken 

care of and protected from financial 

losses. Specifically, the Department is 

considering imposing requirements on 

airlines to provide affected passengers 

cash compensation, free rebooking, and 

amenities such as meals, lodging for 

overnight delays, and transportation to 

and from lodging. The Department also 

seeks comment on whether some 

protections should be provided during 

any type of disruption, how to 

determine whether a cancellation or 

delay is within an airline’s control, and 

how to ensure that passengers receive 

the correct information from the airline 

in a timely manner. Additionally, the 

Department solicits comments on how 

to ensure that the process for passengers 

to receive compensation and amenities 

is clear, simple, straightforward, and 

prompt, and whether to require certain 

aspects of the process to be automatic. 

Further, the Department seeks comment 

on whether it should require airlines to 

offer free rebooking on the same or 

partner airline to a passenger with a 

disability and others in the same travel 

party when one or more accessibility 

feature needed by the person with 

disability is unavailable. 

DATES: Comments should be filed by 

February 10, 2025. Late-filed comments 

will be considered to the extent 

practicable. 

ADDRESSES: You may file comments 

identified by the docket number DOT– 

OST–2024–0062 by any of the following 

methods: 

• Federal eRulemaking Portal: go to 

https://www.regulations.gov and follow 

the online instructions for submitting 

comments. 

• Mail: Docket Management Facility, 

U.S. Department of Transportation, 1200 

New Jersey Ave. SE, West Building 

Ground Floor, Room W12–140, 

Washington, DC 20590–0001. 

• Hand Delivery or Courier: West 

Building Ground Floor, Room W12–140, 

1200 New Jersey Ave. SE, Washington, 

DC, between 9 a.m. and 5 p.m. ET, 

Monday through Friday, except Federal 

holidays. 

• Fax: (202) 493–2251. 

Instructions: You must include the 

agency name and docket number DOT– 

OST–2024–0062 or the Regulatory 

Identification Number (RIN 2105–AF20) 

for the rulemaking at the beginning of 

your comment. All comments received 

will be posted without change to 

https://www.regulations.gov, including 

any personal information provided. 

Privacy Act: Anyone is able to search 

the electronic form of all comments 

received in any of our dockets by the 

name of the individual submitting the 

comment (or signing the comment, if 

submitted on behalf of an association, 

business, labor union, etc.). For 

information on DOT’s compliance with 


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Federal Register / Vol. 89, No. 238 / Wednesday, December 11, 2024 / Proposed Rules 99761 

1 All ten of the largest U.S. airlines guarantee 

meals and rebooking without charge on the ticketed 

airline, and nine of the 10 guarantee hotel 

accommodation and ground transportation to and 

from the hotel for passengers affected by 

controllable overnight delays and cancellations. Six 

of the 10 guarantee fee-free rebooking on a partner 

airline or another airline with which it has an 

agreement for controllable cancellations and five do 

so for lengthy, controllable delays. See https://

www.transportation.gov/airconsumer/airlinecustomer-service-dashboard. 

2See EC No 261/2004, Article 5; see also Joined 

Cases C–402/07 and C–432/07, Sturgeon v. Air 

France, 2009 E.C.R. I–10923, ¶ 69 (applying EU 

compensation requirements to delays of three hours 

or more). 

3 See EC No 261/2004, Articles 5.1, 6.1, 8.1; see 

also European Commission Notice: Interpretative 

Guidelines on Regulation (EC) No 261/2004 of the 

European Parliament and of the Council 

Establishing Common Rules on Compensation and 

Assistance to Passengers in the Event of Denied 

Boarding and of Cancellation or Long Delay of 

Flights and on Council Regulation (EC) No 2027/97 

on Air Carrier Liability in the Event of Accidents 

as Amended by Regulation (EC) No 889/2002 of the 

European Parliament and of the Council (‘‘EU 

Interpretive Guidelines’’) (June 15, 2016) at C 214/ 

13 (‘‘According to the Regulation, the air carrier is 

obliged to fulfil the obligation of care even when 

the cancellation of a flight is caused by 

extraordinary circumstances, that is to say 

circumstances which could not have been avoided 

even if all reasonable measures had been taken’’), 

available at https://eur-lex.europa.eu/legal-content/ 

EN/TXT/PDF/?uri=CELEX:52016XC0615(01). 

4See https://www.caa.co.uk/passengers/ 

resolving-travel-problems/delays-and-cancellations/ 

delays/ and https://www.caa.co.uk/passengers/ 

resolving-travel-problems/delays-and-cancellations/ 

cancellations/. 

5APPRs, ¶¶ 12, 19. Under the Canadian 

Regulations, airlines must also provide rebooking 

for cancellations and lengthy delays that are either 

within or outside the airline’s control. See APPRs, 

¶¶ 17, 18. As discussed later in this ANPRM, the 

Canadian Transportation Agency has initiated a 

consultation to revise the APPRs. 

6See ANAC Resolution No. 400 (Dec. 13, 2016). 

7 Docket available at https://www.regulations.gov/ 

docket/DOT-OST-2024-0062/. 

the Privacy Act, please visit https://

www.transportation.gov/privacy. 

Docket: For access to the docket to 

read background documents and 

comments received, go to https://

www.regulations.gov or to the street 

address listed above. Follow the online 

instructions for accessing the docket. 

FOR FURTHER INFORMATION CONTACT: 

Heather Filemyr, John Wood, or Blane 

A. Workie, Office of Aviation Consumer 

Protection, U.S. Department of 

Transportation, 1200 New Jersey Ave. 

SE, Washington, DC 20590, 202–366– 

9342, 202–366–7152 (fax), 

heather.filemyr@dot.gov, john.wood@

dot.gov, or blane.workie@dot.gov 

(email). 

SUPPLEMENTARY INFORMATION: 

A. Background and Overview of 

Existing Requirements 

The Department’s regulation at 14 

CFR 259.5 requires U.S. and foreign 

airlines to have and adhere to a 

customer service plan that identifies the 

services that an airline provides to 

mitigate passenger hardships resulting 

from flight cancellations and 

misconnections. Under this regulation, 

airlines are free to choose the services 

to provide passengers affected by flight 

disruptions. In 2022, after an 

unacceptable level of flight delays and 

cancellations, the Department carefully 

reviewed these plans to determine how 

U.S. airlines were caring for their 

passengers and found that the airlines’ 

commitments in these plans did not 

guarantee adequate services even for 

flight delays and cancellations within 

the airline’s control. However, after a 

two-year DOT push to improve the 

passenger experience, today, almost all 

of the largest U.S. airlines voluntarily 

commit in their customer service plan to 

provide services such as meals, lodging, 

and free rebooking to passengers 

impacted by cancellations and lengthy 

delays when airlines are responsible.1

While the Department had also urged 

U.S. airlines to voluntarily commit to 

compensating passengers experiencing 

significant flight disruptions due to 

circumstances within the airline’s 

control, no U.S. airline currently 

guarantees cash compensation, and only 

three airlines guarantee compensation 

in credits or frequent flyer miles for 

airline-caused delays and cancellations. 

The ability of airlines to choose the 

services that they provide to mitigate 

passenger inconveniences resulting 

from flight disruptions under current 

U.S. law contrasts with consumer 

protection regimes in other jurisdiction 

like the European Union (EU) and 

Canada, where airlines are required to 

provide compensation and assistance to 

consumers affected by flight 

disruptions. In the EU, airlines must 

provide compensation to consumers 

facing cancellations or lengthy delays 

unless the airline proves that the 

cancellation or delay is ‘‘caused by 

extraordinary circumstances which 

could not have been avoided even if all 

reasonable measures had been taken.’’ 2

Under that regime, airlines must also 

provide services, including meals, 

hotels, and ground transportation to and 

from the hotel (for overnight 

cancellations and delays) to passengers 

facing lengthy delays or cancellations 

and rebooking to passengers whose 

flights are cancelled, regardless of the 

cause of the delay or cancellation and 

whether it is unavoidable by the 

airline.3 United Kingdom regulations 

impose similar requirements and also 

use the ‘‘extraordinary circumstances’’ 

construct for compensation, with 

compensation amounts established in 

pounds.4 Current Canadian Air 

Passenger Protection Regulations 

(APPRs) require airlines to provide 

compensation for lengthy delays and 

cancellations that are controllable by the 

airline and not required for safety 

purposes and to provide services, 

including meals, overnight 

accommodations, and ground 

transportation to and from the hotel (for 

overnight cancellations and delays), to 

passengers for lengthy delays and 

cancellations that are controllable by the 

airline, regardless of whether the 

controllable delay or cancellation is 

required for safety.5 Brazilian 

regulations also contain similar 

protections for air passengers, including 

a right to compensation, meals, and 

hotel accommodations for cancellations 

and lengthy flight delays.6

In developing this ANPRM, 

Department staff met with individuals 

from the Canadian Transportation 

Agency (CTA) on June 1, 2023, and the 

European Commission (EC) on June 12, 

2023, to better understand the 

requirements under those existing 

regulatory regimes. On July 19, 2023, at 

the request of the International Air 

Transport Association (IATA) and 

Airlines for America (A4A), Department 

staff met with representatives of those 

groups to hear their perspective on 

compensation and assistance to 

passengers in the event of flight delays 

and cancellations. On May 10, 2024, at 

the request of AirHelp, Department staff 

met with representatives from that 

organization about its experience filing 

claims on behalf of passengers with 

airlines covered by compensation 

requirements in foreign jurisdictions, 

including the EU. On September 10, 

2024, Department staff attended a panel 

discussion moderated by the National 

Consumers League, supported by a grant 

from AirHelp, and featuring speakers 

from the Travel Technology 

Association, U.S. Public Interest 

Research Group, the White House, and 

AirHelp, at which those groups 

discussed this contemplated 

rulemaking. Senator Edward Markey 

also gave remarks at that event. All 

documents submitted to the Department 

pertaining to these meetings and a 

summary of the panel discussion have 

been added to the rulemaking docket.7

B. Need for Rulemaking 

(1) Data Indicates Controllable 

Cancellations and Lengthy Flight Delays 

Affect Millions of Passengers 

Cancellations and lengthy flight 

delays pose significant inconvenience, 


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99762 Federal Register / Vol. 89, No. 238 / Wednesday, December 11, 2024 / Proposed Rules 

8See Airline Passenger Protections: Observations 

on Flight Delays and Cancellations, and DOT’s 

Efforts to Address Them, GAO–23–105524 (‘‘2023 

GAO Report’’), at 22 (Apr. 2023), available at 

https://www.gao.gov/assets/gao-23-105524.pdf. 

9Of the 49,958 air travel service complaints that 

the Department received in calendar year 2021, 13 

percent concerned flight problems. See https://

www.transportation.gov/individuals/aviationconsumer-protection/february-2022-air-travelconsumer-report. Of the 77,656 air travel service 

complaints that the Department received in 

calendar year 2022, 32 percent concerned flight 

problems. See https://www.transportation.gov/ 

resources/individuals/aviation-consumerprotection/february-2023-air-travel-consumerreport. While the Department does not have 

complaint data available for calendar year 2023 

because of revisions in how it processes consumer 

complaints for efficiency, it estimates that it 

received 88,136 complaints based on receiving 

96,853 submissions that year and complaints 

making up an average of 91 percent of submissions 

over the past three years. See https://

www.transportation.gov/resources/individuals/ 

aviation-consumer-protection/june-december-2023- 

and-2023-annual-consumer. The percentage of 

complaints that concern flight problems in calendar 

year 2023 is not known. 

10Bureau of Transportation Statistics, On-Time 

Performance, Marketing Carrier Flight Delays and 

Cancellations 2022 and 2023, available at https:// 

www.regulations.gov/docket/DOT-OST-2024-0062/. 

11 Id. 

12 Id. 

13 Id. 

14 Id. 

15 Id. 

16 Id. 

17 2023 GAO Report. 

18See id. at 13 (‘‘In the last half of 2021, there 

were 6.3 percent more sustained cancellation events 

than during the same time period in 2018, and 12.2 

percent more than in 2019, despite 14 percent fewer 

scheduled flights compared to 2019. In the first 4 

months of 2022, the number of sustained 

cancellation events increased even more 

substantially, with 56.9 percent more events in this 

time period compared to the same 4-month time 

period in 2018, and 42.9 percent more than in the 

first 4 months of 2019. There were 12.6 percent 

fewer scheduled flights during the relevant 2022 

time period as compared to the same time period 

in 2019.’’). 

19 Id. at 17. 

20 Id. at 9. 

21 In December 2023, the Department assessed a 

$140 million civil penalty against Southwest 

Airlines for numerous violations of consumer 

protection laws during and after its operational 

failures between December 2022 through January 

2023. The penalty was 30 times larger than any 

previous DOT penalty for consumer protection 

violations. The majority of the penalty will go 

towards compensating future Southwest passengers 

affected by cancellations or significant delays 

caused by the airline. See Southwest Airlines Co., 

DOT Order No. 2023–12–11, Consent Order (Dec. 

15, 2023). 

22Bureau of Transportation Statistics, Arrival 

Performance by Carrier, July 19–24, 2024, available 

at https://www.regulations.gov/docket/DOT-OST2024-0062/. 

stress, and financial cost to impacted 

passengers. Such delays and 

cancellations cause passengers to lose 

time, may disrupt other reservations 

(such as hotel reservations), and may 

cause passengers to miss important 

events.8 Flight cancellations, delays, 

and missed connections occurred in 

significant numbers as airlines adjusted 

their operations to meet the post-COVID 

pandemic air travel demand and have 

been the subject of a large number of the 

complaints about airlines that 

consumers have submitted to the 

Department since then.9

According to flight performance data 

reported by the largest U.S. carriers to 

the Department’s Bureau of 

Transportation Statistics (BTS), in 

calendar year 2022, the carriers 

combined cancelled 190,038 domestic 

scheduled passenger flights 

(approximately 2.7 percent of their total 

domestic scheduled passenger flights), 

and over 1.4 million of their domestic 

scheduled passenger flights (more than 

20 percent of their total domestic 

scheduled passenger flights) were 

delayed in arriving by 15 minutes or 

more.10 Of the more than1.4 million 

delayed flights, 85,892 (approximately 

6.1 percent) were delayed three hours or 

more.11

In calendar year 2023, these carriers 

combined cancelled 93,897 domestic 

scheduled passenger flights 

(approximately 1.3 percent of their total 

domestic scheduled passenger flights).12

Further, more than 1.4 million of the 

carriers’ domestic scheduled passenger 

flights (approximately 20 percent of 

their total domestic scheduled 

passenger flights) were delayed 15 

minutes or more that year.13 Of the more 

than 1.4 million delayed flights, 95,024 

of them were delayed three hours or 

more, which was approximately 6.8 

percent of total flights delayed that 

year.14

A significant percentage of the 

domestic cancellations that air carriers 

reported to BTS in 2022 and 2023 were 

reported as ‘‘air carrier’’-caused and 

most of the domestic delays of three 

hours or more that air carriers reported 

to BTS listed ‘‘air carrier’’ as a cause of 

the delay. Carriers reported to BTS that 

38 percent of their domestic scheduled 

passenger flight cancellations were ‘‘air 

carrier’’-caused in calendar year 2022, 

and 28 percent of their domestic 

scheduled passenger flight cancellations 

were ‘‘air carrier’’-caused in calendar 

year 2023.15 For domestic scheduled 

passenger flight delays of three hours or 

more, the carriers reported to BTS that 

65 percent of those delays included an 

‘‘air carrier’’ cause of delay in 2022, and 

62 percent included an ‘‘air carrier’’ 

cause of delay in 2023.16 These delay 

percentages do not include additional 

delays that were reported by carriers as 

caused by ‘‘late arriving aircraft.’’ Such 

delays are not reported as ‘‘air carrier’’- 

caused even when the reason for the 

‘‘late arriving aircraft’’ was within the 

carrier’s control. 

In April 2023, the U.S. Government 

Accountability Office (GAO) published 

a report describing its examination of 

controllable cancellations and delays 

following the initial disruption to air 

transportation in 2020 due to the global 

COVID pandemic and documented 

concerns with the gap in consumer 

protections available to passengers 

facing cancellations and lengthy 

delays.17 GAO reviewed data from the 

Department’s BTS and concluded that 

as airlines recovered in 2021 and 2022 

‘‘[s]ustained cancellation events, or a 

series of days where an airline cancelled 

a large percentage of daily flights, lasted 

longer and became more common as 

travel demand increased.’’ 18 GAO 

estimated that flight cancellations from 

July 2021 through April 2022 

potentially affected over 15 million 

passengers, and flight delays during that 

time period potentially affected over 

116 million passengers.19 The 2023 

GAO report also concluded that: 

‘‘[b]eyond DOT’s requirement for 

airlines to provide cash refunds to 

passengers for cancelled or significantly 

changed flights, airline compensation to 

passengers is generally limited. Airlines 

are not required to provide 

accommodations for flight disruptions 

unless specified in an airline’s contract 

of carriage or customer service plan, 

although airlines may provide 

additional accommodations in certain 

circumstances. As we have previously 

reported, airline assistance to affected 

passengers can vary significantly. Flight 

disruptions, particularly if they are long 

lasting, can significantly inconvenience 

passengers.’’ 20

The Department’s Office of Aviation 

Consumer Protection investigates largescale and sustained disruptive events 

that impact large numbers of passengers 

to ensure compliance with aviation 

consumer protection requirements. At 

times, these investigations can also 

reveal gaps in protections for aviation 

consumers, such as the importance for 

consumers to know whether a 

cancellation or delay is considered 

controllable and would entitle them to 

promised services and amenities. For 

example, from late December 2022 

through early January 2023, Southwest 

Airlines cancelled 16,900 flights and 

stranded over two million passengers, 

reporting most of the cancelled flights to 

BTS as due to circumstances within the 

carrier’s control.21 In July 2024, 

following a global information 

technology (IT) systems issue, Delta Air 

Lines cancelled more than 5,550 flights 

over a five-day period.22 The 


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Federal Register / Vol. 89, No. 238 / Wednesday, December 11, 2024 / Proposed Rules 99763 

23 See https://www.transportation.gov/ 

airconsumer/airline-customer-service-dashboard. 

24 Public Law 118–63. 

25 See Statement of Administration Policy, Senate 

Substitute Amendment to H.R. 3935—FAA 

Reauthorization Act of 2024 (May 8, 2024), 

available at https://www.whitehouse.gov/wpcontent/uploads/2024/05/SAP-SSA-HR3935.pdf. 

Department immediately notified U.S. 

carriers that it considers the flight 

disruptions resulting from the IT outage 

to be ‘‘controllable’’ since the issue is a 

computer outage of the carrier’s 

equipment and informed carriers that 

DOT expected the carriers to make good 

on the commitments that they 

voluntarily made to customers affected 

by controllable cancellations and 

delays. Notably, the Department saw a 

significant uptick in consumer 

complaints following each of these 

events, reflecting significant consumer 

harm, including financial harm from 

these controllable cancellations and 

delays. 

(2) Inconsistency in How Airlines 

Determine Controllable Cancellations 

and Delays 

The Department is exploring in this 

ANPRM how to determine which delays 

and cancellations are controllable such 

that airlines are held responsible for free 

rebooking, compensation, and payment 

for services such as meals, lodging, or 

transportation to and from lodging. 

Currently, when a flight disruption 

involves more than one cause, airlines 

determine whether the event was or was 

not controllable in different ways. For 

example, one airline might look at the 

first cause, another the longest cause, 

and another may use yet a different 

method to deem a multi-factor event 

controllable or not controllable, 

potentially ignoring factors that were 

within their control that caused or 

exacerbated consumer harm. 

At the December 2021 meeting of the 

Department’s Aviation Consumer 

Protection Advisory Committee 

(ACPAC), presentations by a 

representative of the Arizona Attorney 

General’s Office (AAG) and 

representatives of A4A, among others, 

addressed the causes of cancellation and 

delay when weather is involved. The 

AAG representative explained that 

airlines have incentive to blame delays 

on weather because, when a delay is 

attributed to weather, the airline would 

not have to provide vouchers, meals, or 

hotels, and other amenities, if 

guaranteed in its customer service plan 

or contract of carriage for controllable 

events, and air travelers likely are more 

understanding about weather delays 

than delays due to mismanagement or 

short staffing. Also at that meeting, 

representatives of A4A explained that a 

weather event can affect multiple areas 

of airline planning in a scope and scale 

unique to each circumstance, including 

scheduling, flight planning, crew 

planning, aircraft routing, maintenance 

planning, gate sequencing, and aircraft 

and passenger support. One A4A 

representative stated that FAA data 

indicates that 70 percent of all air traffic 

delays are caused by weather, which in 

the representative’s view explains why 

airlines often described weather as the 

root cause of a delay. The representative 

asserted that there is no clear 

demarcation of when a weather event 

stops being the original or primary 

factor for a delay associated with a flight 

or sequence of flights. An additional 

A4A representative added that some 

airlines’ contracts of carriage, to the 

extent they provide for amenities for 

flight irregularities, exclude delays or 

cancellations where the cause is outside 

the airline’s control, such as weather. 

He said that if weather is the original or 

primary factor, an airline’s contractual 

obligation to provide amenities may not 

apply based on the wording of the 

contract of carriage. 

Section 512 of the FAA 

Reauthorization Act of 2024 (2024 FAA 

Act) requires the Department to direct 

certain air carriers ‘‘to establish policies 

regarding reimbursement for lodging, 

transportation between such lodging 

and the airport, and meal costs incurred 

due to a flight cancellation or significant 

delay directly attributable to the air 

carrier.’’ The statute does not further 

describe what ‘‘directly attributable’’ to 

the air carrier means, including when 

multiple causal factors are involved in 

a flight disruption. A regulation would 

be necessary to require air carriers to 

establish policies under section 512. 

The regulation could also clarify which 

cancellations and delays are directly 

attributable to a carrier. 

(3) Challenges Remain for Passengers 

Seeking Rebooking, Compensation, 

Notifications, and Services Such as 

Meals, Lodging, and Transportation to 

and From Lodging 

As previously discussed, current 

Department regulations do not require 

an airline to provide compensation, 

services, notifications of services due, or 

reimbursements to passengers impacted 

by cancellations and lengthy delays that 

are within its control unless the airline 

voluntarily commits to do so. Many 

airlines, including foreign airlines, have 

not made voluntary guarantees in their 

customer service plans to provide 

needed services and compensation to 

their customers affected by controllable 

cancellations or delays. In addition, 

airlines that have made enforceable 

commitments to their customers for 

controllable flight cancellations and 

lengthy controllable delays, including 

those reflected on the Department’s 

Airline Customer Service Dashboard,23

can remove these commitments from 

their customer service plan at any time. 

Further, the competition encouraged by 

the Dashboard has not resulted in any 

U.S. airline committing to provide cash 

compensation to passengers for 

controllable flight cancellations and 

lengthy controllable flight delays. Also, 

while many U.S. airlines have 

committed to providing free rebooking 

on partner airlines, meals, hotels for 

passengers affected by overnight 

cancellations or delays, and 

transportation to and from the hotel, not 

all U.S. airlines have, demonstrating a 

potential need for protections in this 

area. 

In addition, on May 16, 2024, the 

President signed the 2024 FAA Act into 

law.24 Section 512 of the 2024 FAA Act 

requires the Department to ‘‘direct all 

air carriers providing scheduled 

passenger interstate or intrastate air 

transportation to establish policies 

regarding reimbursement for lodging, 

transportation between such lodging 

and the airport, and meal costs incurred 

due to a flight cancellation or significant 

delay directly attributable to the air 

carrier.’’ Before the 2024 FAA Act was 

passed by Congress, the Executive 

Office of the President released a 

Statement of Administration Policy 

explaining that the Act ‘‘include[d] key 

consumer protection provisions on 

airline reimbursement for incurred costs 

due to controllable disruptions . . . that 

would set a floor that the Department of 

Transportation could build on as 

deemed appropriate by the Secretary of 

Transportation.’’ 25

This ANPRM requests public 

comment to assist the Department in its 

consideration of what regulations may 

be needed to implement the 

requirements of section 512 of the 2024 

FAA Act, ensure that airlines do not 

engage in unfair or deceptive practices 

or unfair methods of competition by 

establishing minimum requirements for 

when and how airlines must 

compensate passengers and make 

relevant reimbursements and services 

available to them, ensure that these 

protections are not subject to removal at 

an airline’s discretion, and ensure 

passengers are protected from financial 

loss whether scheduled to be on a 

domestic or international flight that is 

cancelled or significantly delayed due to 


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99764 Federal Register / Vol. 89, No. 238 / Wednesday, December 11, 2024 / Proposed Rules 

26 See, e.g., American Airlines Customer Service 

Plan (updated July 19, 2024), available at https:// 

www.aa.com/i18n/customer-service/support/ 

customer-service-plan.jsp, and Southwest Airlines 

Customer Service Plan (revised April 23, 2024), 

available at https://www.southwest.com/assets/ 

pdfs/corporate-commitments/customer-serviceplan.pdf?clk=7396032 (guaranteeing meals and 

hotel accommodations ‘‘upon request’’ by the 

passenger). 

27 89 FR 32760. 

28 89 FR 65534. 

29 14 CFR 260.2 (see definition of significantly 

delayed or changed flight at paragraphs (1) and (2)), 

260.6(a). 

30 14 CFR 260.6(b)(1) through (3). 

circumstances within an airline’s 

control. 

The Department is also issuing this 

ANPRM to assist its consideration of 

what regulations may be needed to 

ensure that passengers receive timely 

notifications of available compensation, 

rebooking, and services such as meals, 

lodging, and transportation to and from 

lodging. Some airlines currently 

condition service guarantees in their 

customer service plans on affirmative 

requests by consumers for those 

services.26 Many passengers may not 

know the intricacies of airlines’ 

customer service plan guarantees, and, 

even when passengers are aware of an 

airline’s commitments, they may not 

know that a particular cancellation or 

delay is within the airline’s control and 

so a service is owed. 

The Department’s ACPAC recently 

considered the quality and quantity of 

information on the causes of air carrier 

delays and cancellations provided to 

passengers adversely affected by an 

airline cancellation or delay, focusing 

on whether it is an unfair or deceptive 

practice for an air carrier to inform a 

passenger that a flight is delayed or 

cancelled due to weather alone when 

other factors are involved. At the 

December 2021 ACPAC meeting, a 

representative of the AAG and 

representatives of A4A, among others, 

presented to the ACPAC on the topic. 

The AAG stated that consumers need 

accurate information about the reasons 

for a delay so that they can exercise 

their rights and make an informed 

decision about their options at the time 

and whether to use that airline in the 

future. Also at that meeting, an A4A 

representative stated that he did not 

find withholding information on cause 

of delay meets the Department’s test for 

unfair or deceptive practices in air 

transportation. The representative stated 

that the Department’s regulation that 

requires airlines to provide passengers 

flight status notification in the event of 

a known delay, cancellation, or 

diversion, 14 CFR 259.8, is sufficient to 

inform consumers of the material 

information. The representative noted 

that the current regulation does not 

require airlines to provide the cause of 

a flight disruption but addresses 

material information, such as 

information that would assist the 

passenger in deciding when to go to the 

airport or when to request a refund or 

rebooking on another flight. The 

representative added that some airlines’ 

contracts of carriage, to the extent they 

provide for amenities for flight 

irregularities, exclude delays or 

cancellations where the cause is outside 

the airline’s control, such as weather. 

He said that if weather is the original or 

primary factor, an airline’s contractual 

obligation to provide amenities may not 

apply based on the wording of the 

contract of carriage. The representative 

raised concern should airlines be 

required to provide real-time detailed 

explanations of all subsidiary factors 

contributing to the delay that was 

fundamentally caused by weather, 

stating that airlines may be compelled to 

publish unsubstantiated information 

that the airlines lacked adequate time to 

confirm, which he believed would be a 

disservice to consumers. 

At the December 2022 ACPAC 

meeting, the ACPAC deliberated on the 

topic of information provided to 

consumers adversely affected by airline 

delays or cancellations. The ACPAC 

member representing consumers asked 

that the ACPAC consider recommending 

that airlines notify passengers when a 

service or amenity becomes available 

due to a controllable delay or 

controllable cancellation. This member 

stated that his proposal reflected 

concern that, without such notifications, 

passengers would be required to 

understand an airline’s customer service 

plan or contract of carriage and 

affirmatively request amenities from the 

airline. The member representing 

airlines opposed the recommendation, 

noting that information about services 

and amenities is available through the 

Department’s Airline Customer Service 

Dashboard, and expressed concern 

about whether an airline would have 

contact information for the passenger to 

provide a notification for tickets sold 

through ticket agents. The member 

representing consumers responded that 

the Dashboard is useful to consumers, 

but some may not know about the 

Dashboard and those who do would be 

unsure whether the commitments apply 

to them because they would not know 

the cause of the delay or cancellation. 

After discussion, the ACPAC adopted a 

recommendation that the Department 

issue a regulation requiring airlines to 

notify affected consumers of the 

availability of services and amenities for 

controllable delays and cancellations, 

with the member representing airlines 

voting against the recommendation. 

(4) Harm to Consumers, Including 

Passengers With Disabilities, When Free 

Rebooking Is Not Provided 

In April 2024, the Department 

published a final rule, Refunds and 

Other Consumer Protections, codifying 

and clarifying its longstanding 

interpretation that, under 49 U.S.C. 

41712, airlines must provide refunds to 

passengers for flights that are cancelled 

or significantly changed, regardless of 

whether the cancellation or change is 

within the airline’s control.27 In August 

2024, the Department issued a second 

final rule, Refunds and Other Consumer 

Protections (2024 FAA Reauthorization) 

to implement the refund-related 

provisions of the 2024 FAA Act.28 These 

final rules (collectively ‘‘Refund Rules’’) 

provide, among other things, that 

passengers are entitled to an automatic 

refund if their flight is cancelled and 

they do not accept any alternatives 

offered. The Refund Rules also provide 

that passengers are entitled to an 

automatic refund if they decide not to 

travel on a changed itinerary when the 

change results in a flight departing from 

the origination airport three hours or 

more for domestic itineraries and six 

hours or more for international 

itineraries earlier or later than the 

original scheduled departure time, or 

results in the flight departing from a 

different origination airport or arriving 

at a different destination airport.29

In addition, under the Department’s 

Refund Rules, an airline must provide 

an automatic refund to an individual 

with a disability (and others in that 

individual’s reservation) upon 

notification that the individual decides 

not to travel on a changed itinerary 

because: (1) the individual with a 

disability is downgraded to a lower 

class of service that results in one or 

more accessibility features needed by 

the individual becoming unavailable, (2) 

the airline changes the aircraft to a 

substitute aircraft on which one or more 

accessibility features needed by the 

individual are unavailable, or (3) the 

airline changes the flight to schedule the 

passenger to travel through one or more 

connecting airports different from the 

original itinerary.30

The Department’s recent Refund 

Rules provide important new refund 

protections for passengers who are 

negatively impacted by a change in an 

airline itinerary. Those rules, however, 

do not require airlines to accommodate 


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31 14 CFR 399.79(b)(1). 

32 14 CFR 399.79(b)(2). 

33 Id. 

34 14 CFR 399.79(c). 

35 87 FR 52677 (Aug. 28, 2022). 

36Pursuant to 49 U.S.C. 40102(a)(2), an ‘‘air 

carrier’’ means a citizen of the United States 

undertaking by any means, directly or indirectly, to 

provide air transportation. 

37Pursuant to 49 U.S.C. 40102(a)(25) ‘‘interstate 

air transportation’’ means the transportation of 

passengers or property by aircraft as a common 

carrier for compensation, or the transportation of 

mail by aircraft—(A) between a place in—(i) a State, 

territory, or possession of the United States and a 

place in the District of Columbia or another State, 

territory, or possession of the United States; (ii) 

Hawaii and another place in Hawaii through the 

airspace over a place outside Hawaii; (iii) the 

District of Columbia and another place in the 

District of Columbia; or (iv) a territory or possession 

of the United States and another place in the same 

territory or possession; and (B) when any part of the 

transportation is by aircraft. 

38Codification was effectuated in Public Law 

103–272 (enacted July 5, 1994). 

passengers by offering rebooking to meet 

the passenger’s needs, including the 

accessibility needs of passengers with 

disabilities. In the rulemaking on 

Refunds and Other Consumer 

Protections, the Paralyzed Veterans of 

America submitted a comment 

requesting the Department require 

airlines to ‘‘expeditiously locate and 

offer alternative transportation that 

meets the specific needs of the 

passenger with a disability,’’ explaining 

that a ‘‘refund is purposeless if the 

passenger is stranded.’’ 

The Department is using this ANPRM 

to assist in its assessment of whether it 

should require airlines to provide 

rebooking without charge to a passenger 

when the airline makes a significant 

change to the passenger’s itinerary. This 

includes an assessment of whether an 

airline should be required to provide 

rebooking without charge to a passenger 

with a disability, and others in the same 

travel party, when the carrier makes 

changes that result in the unavailability 

of an accessibility feature needed by the 

passenger with a disability or when the 

carrier makes other significant changes 

to the itinerary of an individual with a 

disability, like a change in the 

origination or destination airport or 

cancels a flight. 

C. Statutory Authority 

The Department’s rulemaking would 

be based on several statutory 

authorities. 

(1) Unfair and Deceptive Practices and 

Unfair Methods of Competition 

Section 41712 of title 49 of the U.S. 

Code authorizes the Department to 

prohibit unfair and deceptive practices 

and unfair methods of competition by 

air carriers, foreign air carriers, and 

ticket agents in air transportation and 

the sale of air transportation. The 

Department’s rule at 14 CFR 399.79 

outlines its policies related to unfair and 

deceptive practices and defines the 

terms ‘‘unfair’’ and ‘‘deceptive.’’ A 

practice is ‘‘unfair’’ to consumers if it 

causes or is likely to cause substantial 

injury, which is not reasonably 

avoidable, and the harm is not 

outweighed by benefits to consumers or 

competition.31 A practice is ‘‘deceptive’’ 

to consumers if it is likely to mislead a 

consumer, acting reasonably under the 

circumstances, with respect to a 

material matter.32 A matter is material if 

it is likely to have affected the 

consumer’s conduct or decision with 

respect to a product or service.33 Proof 

of intent is not necessary to establish 

unfairness or deception.34 The 

Department elaborated further on the 

elements of ‘‘unfair’’ and ‘‘deceptive’’ in 

a 2022 guidance document.35

The Department may address unfair 

and deceptive practices under 49 U.S.C. 

41712 and 49 U.S.C. 40113(a), which 

authorizes the Secretary to ‘‘take action 

the Secretary . . . considers necessary 

to carry out [part A of chapter 49 of the 

U.S. Code, which contains section 

41712], including . . . prescribing 

regulations, standards, and procedures.’’ 

The Department is exploring through 

this ANPRM whether requirements for 

services such as rebooking, meals, 

lodging, and transportation to and from 

lodging or reimbursements for those 

services, or compensation are needed to 

prevent unfair and deceptive practices 

or unfair methods of competition in the 

event of cancellations and lengthy 

delays that are within the airline’s 

control. The Department is also 

examining whether notifications by 

airlines to passengers of available 

services, reimbursements, and 

compensation when such services are 

due are necessary to address unfair and 

deceptive practices. Additionally, the 

Department is considering whether it 

may be an unfair or deceptive practice 

for an airline to fail to provide free 

rebooking for significant changes, 

including changes applicable to 

passengers with disabilities and others 

in the same travel party when a change 

in class of service or aircraft affects 

available accessibility features or a 

change in airport occurs. Finally, the 

Department is weighing whether any 

other unfair methods of competition 

should be addressed in this rulemaking. 

If the Department decides to propose 

regulations declaring a practice unfair or 

deceptive, then notice and an 

opportunity to petition the Department 

for a hearing will be provided in 

accordance with procedures found in 14 

CFR 399.75. 

(2) FAA Reauthorization Act of 2024 

As described previously, section 512 

of the 2024 FAA Act requires the 

Department to ‘‘direct all air carriers 

providing scheduled passenger 

interstate or intrastate air transportation 

to establish policies regarding 

reimbursement for lodging, 

transportation between such lodging 

and the airport, and meal costs incurred 

due to a flight cancellation or significant 

delay directly attributable to the air 

carrier.’’ This ANPRM explores how the 

Department should implement this 

statutory requirement. 

In addition, section 505 of the 2024 

FAA Act requires that certain air 

carriers must maintain, without charge 

and available at all times: (1) a customer 

service telephone line staffed by live 

agents, (2) a customer chat option that 

allows for customers to speak to a live 

agent within a reasonable time, to the 

greatest extent practicable, or (3) a 

monitored text messaging number that 

enables customers to communicate and 

speak with a live agent directly. Section 

505 authorizes DOT to issue such rules 

as may be necessary to carry out the 

requirement and provides that airlines 

must comply with section 505’s 

requirements ‘‘without regard to 

whether the Secretary has promulgated 

any rules to carry out’’ section 505. This 

ANPRM explores whether the 

Department should propose provisions 

regarding the manner and timeliness of 

airline customer service during flight 

disruptions, whether controllable or not, 

under this statutory requirement. 

(3) Safe and Adequate Interstate Air 

Transportation 

This ANPRM also involves topics 

related to air carriers 36 that may involve 

the Secretary’s authority under 49 

U.S.C. 41702, which states that ‘‘[a]n air 

carrier shall provide safe and adequate 

interstate air transportation.’’ 37 The 

Civil Aeronautics Board (CAB), the 

predecessor to the Department, had the 

authority to ensure that air carriers 

provide ‘‘safe and adequate service, 

equipment and facilities’’ under section 

404(a) of the Federal Aviation Act of 

1958, which was later codified in 49 

U.S.C. 41702.38 The CAB relied on 

section 404(a) to adopt a regulation that 

restricted smoking on flights by dividing 

aircraft cabins into smoking and 

nonsmoking sections. The CAB 

reasoned that its authority to require air 

carriers to provide ‘‘adequate service’’ 

under section 41702 includes ensuring 


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39 ‘‘[T]he extent and depth of passenger 

discomfort and annoyance from unsegregated and 

unregulated smoking on aircraft compels the 

conclusion that service which does not provide for 

the effective separation of smokers constitutes 

neither adequate service nor reasonable practice 

and cannot be permitted under the act.’’ 38 FR 

12209 (May 10, 1973). 

40See Diefenthal v. Civil Aeronautics Bd., 681 

F.2d 1039 (5th Cir. 1982) (adequate service can refer 

both to the number of flights scheduled as well as 

the quality of service provided). 

41 81 FR 11415 (Mar. 4, 2016). 

42 Id. at 11421. 

43 49 U.S.C. 41705. 

44Public Law 99–435, sec. 3, 100 Stat. 1080, 1080 

(1986). 

45 55 FR 8008 (Mar. 6, 1990). 

46The largest 15 U.S. air carriers accounted for 

more than 95 percent of domestic scheduled 

passenger air transportation in 2023. Bureau of 

Transportation Statistics, Transtats, T–100 Market 

Data, available at https://www.regulations.gov/ 

docket/DOT-OST-2024-0062/. Each of these airlines 

operate an aircraft of 30 or more seats. Bureau of 

Transportation Statistics, Part 241 Financial Data, 

Form B–43, available at https://

www.regulations.gov/docket/DOT-OST-2024-0062/. 

47See 14 CFR 259.5(b)(14). 

48Under the Regulatory Flexibility Act carriers 

that exclusively provide air transportation with 

aircraft originally designed to have a maximum 

passenger capacity of 60 seats or less or a maximum 

payload capacity of 18,000 pounds or less are small 

entities. See 14 CFR 399.73. 

49Four U.S. carriers, American Airlines, Delta Air 

Lines, United Airlines, and Southwest Airlines, 

comprised 10 percent or more of domestic 

scheduled passenger revenue in 2023, all with over 

that the service does not cause 

passenger discomfort.39 The CAB’s 

regulation and interpretation of 

‘‘adequate service’’ was later challenged 

by a passenger, but the U.S. Court of 

Appeals for the Fifth Circuit found that 

‘‘adequate service’’ referred both to the 

number of flights provided by an air 

carrier and the quality of service 

provided to passengers.40

More recently, the Department relied 

on its authority to provide safe and 

adequate interstate transportation in 

section 41702 in its 2016 final rule 

prohibiting the use of e-cigarettes onboard aircraft.41 In that final rule, the 

Department reasoned that it had the 

authority to rely on the ‘‘adequate’’ 

prong in section 41702 to ban the use 

of e-cigarettes. The Department argued 

that discomfort from e-cigarettes was 

like the discomfort described by the 

CAB when it chose to restrict smoking 

on aircraft in 1973.42

Through this ANPRM, the Department 

is exploring whether providing 

rebooking, meals, lodging, and 

transportation to and from lodging 

during flight disruptions is necessary to 

ensure that passengers are provided 

with adequate interstate transportation. 

In addition, the Department is exploring 

whether an airline is failing to provide 

adequate interstate air transportation 

when it doesn’t offer and, if accepted, 

provide free rebooking to passengers 

when there is a significant change to the 

flight itinerary, including to passengers 

with disabilities and others in the same 

travel party when a change in airport, 

class of service, or aircraft affects 

available accessibility features. 

(4) Air Carrier Access Act 

The Department’s questions in this 

ANPRM about rebooking for passengers 

with disabilities, and individuals in the 

same travel party, relate to the 

Department’s authority under the Air 

Carrier Access Act (ACAA), in addition 

to the other authorities previously 

discussed.43 The ACAA prohibits 

discrimination in airline service because 

of disability by U.S. and foreign air 

carriers. When it enacted the ACAA, 

Congress directed the Department ‘‘to 

promulgate regulations to ensure nondiscriminatory treatment of qualified 

handicapped individuals consistent 

with safe carriage of all passengers on 

air carriers.’’ 44 The Department 

responded by issuing a final rule that 

required carriers to provide 

nondiscriminatory service to 

individuals with disabilities.45 The 

Department is exploring in this ANPRM 

whether imposing rebooking 

requirements on airlines is necessary to 

ensure individuals with disabilities are 

not denied reasonable access to air 

transportation when a change in class of 

service or aircraft affects available 

accessibility features or when a change 

in airport occurs. 

(5) Reporting and Recordkeeping 

The Department is considering 

whether to impose any reporting 

requirements under 49 U.S.C. 41708 or 

recordkeeping requirements under 49 

U.S.C. 41709. Among other things, 

section 41708(b) authorizes the 

Secretary to require U.S. and foreign air 

carriers to file annual, monthly, 

periodical, and special reports in the 

form and way prescribed by the 

Secretary and to provide specific 

answers to questions on which the 

Secretary considers information to be 

necessary. Section 41709 authorizes the 

Secretary to prescribe the form of 

records to be kept by an air carrier. 

(6) Other Authorities 

In carrying out aviation economic 

programs, the Department is required to 

consider the factors identified in 49 

U.S.C. 40101 as being in the public 

interest and consistent with public 

convenience and necessity. Among 

other things, under 49 U.S.C. 

40101(a)(4), the Department is required 

to consider the availability of a variety 

of adequate, economic, efficient, and 

low-priced services without 

unreasonable discrimination or unfair or 

deceptive practices as being in the 

public interest. Under section 

40101(a)(9), it is also in the public 

interest to prevent unfair, deceptive, 

predatory, or anticompetitive practices 

in air transportation. The Department is 

also required by section 40101(a)(12) to 

consider as being in the public interest 

encouraging, developing, and 

maintaining an air transportation system 

relying on actual and potential 

competition to provide efficiency, 

innovation, and low prices. 

D. Request for Data, Analysis, Views, 

Recommendations, and Other 

Comments 

(1) Scope 

(a) Covered Entities 

Which carriers should be covered if 

DOT were to issue a rule requiring 

compensation, services such as meals or 

lodging, or reimbursements for such 

services when there are controllable 

cancellations and lengthy, controllable 

delays? As its primary option, the 

Department is considering covering 

certificated carriers, commuter carriers, 

and foreign air carriers operating to, 

from, or within the United States, 

conducting scheduled passenger service 

with at least one aircraft having a 

designed seating capacity of 30 or more 

seats. This would ensure the 

requirements would apply to 

substantially all scheduled passenger air 

traffic to, from, or within the United 

States.46 This coverage would be 

consistent with the carriers currently 

required to have a customer service plan 

under 14 CFR 259.5, which addresses 

the services airlines voluntarily commit 

to provide their passengers to mitigate 

passenger inconveniences resulting 

from flight cancellations or 

misconnections.47

Alternatively, should the Department 

exclude from coverage carriers that 

exclusively provide air transportation 

with aircraft of a designed seating 

capacity of 60 seats or less and who are 

considered small businesses for 

purposes of the Regulatory Flexibility 

Act? 48 Or should any requirements 

cover all certificated air carriers, 

commuter air carriers, and foreign air 

carriers, regardless of size? Rather than 

excluding only the smallest carriers 

entirely, should the Department impose 

less stringent requirements on U.S. 

carriers who comprise less than 10 

percent of the domestic scheduled 

passenger revenue 49 or foreign air 


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15 percent. No other carrier comprised more than 

six percent of domestic scheduled passenger 

revenue. See docket at https://www.regulations.gov/ 

docket/DOT-OST-2024-0062/. 

50Eighteen foreign carriers exceeded two million 

total enplanements to and from the United States 

in 2023. See id. 

51Air Passenger Protection Regulations, SOR/ 

2019–150, ¶¶ 17, 19. Canadian regulations define 

small carrier to mean any carrier that has not 

transported a worldwide total of two million 

passengers or more during each of the two 

preceding calendar years. Id. ¶ 2. The CTA has 

initiated a consultation to amend its regulations, 

including improving the rebooking obligations for 

passengers of small airlines but proposed to 

continue to apply reduced compensation 

requirements and less stringent rebooking 

obligations to small carriers. See Consultation 

Paper: Proposed Changes to Clarify, Simplify and 

Strengthen the Air Passenger Protection Regulations 

at 10, available at https://otc-cta.gc.ca/sites/default/ 

files/consultation_paper_-_july_2023.pdf. 

52See 89 FR 32833. 

53A merchant of record means the entity 

responsible for processing payments for the airfare, 

as shown in the consumer’s financial charge 

statements such as debit or credit card charge 

statements. 

54See comment at 4, available at https://

www.regulations.gov/comment/DOT-OST-2022- 

0089-5192. 

carriers who have fewer than two 

million total enplanements to and from 

the United States? 50 That approach 

would be like current Canadian 

regulations discussed further in the 

following sections, which impose 

requirements for flight cancellations and 

delays, and have modified rebooking 

and compensation requirements for 

small carriers based on the number of 

passengers transported.51 What, if any, 

other approaches should the 

Department consider when determining 

airline coverage requirements? 

The Department also seeks 

information about whether it may be 

necessary and appropriate to impose 

any requirements on ticket agents or 

indirect air carriers. For example, 

should the Department require ticket 

agents or indirect air carriers to notify 

consumers of available services, 

reimbursements, or compensation 

provided by airlines for controllable 

delays or cancellations or refund the 

fare to consumers if the ticket agent or 

indirect air carrier is the merchant of 

record and the passenger elects to return 

to his or her origination point after the 

passenger is delayed at a connecting 

airport? 

(b) Covered Flights 

To which flights should any 

requirements apply? The Department is 

considering as its primary option 

applying any requirements to flight 

itineraries to, from, or within the United 

States, including itineraries with brief 

and incidental stopover(s) at a foreign 

point without a break in the journey. 

The Department is considering 

defining break in journey consistent 

with the Department’s recently issued 

Refund Rules.52 Under those rules, a 

‘‘break in journey’’ is any deliberate 

interruption by a passenger of a journey 

between a point in the United States 

and a point in a foreign country where 

there is a stopover at a foreign point that 

is scheduled to exceed 24 hours. If the 

stopover at a foreign point is 24 hours 

or less, those rules specify that whether 

the stop is a break in journey would 

depend on various factors, such as 

whether the segment between two 

foreign points and the segment between 

a foreign point and the United States 

were purchased in a single transaction 

and as a single ticket/itinerary, whether 

the segment between two foreign points 

is operated or marketed by a carrier that 

has no codeshare or interline agreement 

with the carrier operating or marketing 

the segment to or from the United 

States, and whether the stopover at a 

foreign point involves the passenger 

picking up checked baggage, leaving the 

airport, and continuing the next 

segment after a substantial amount of 

time. 

Should the Department impose 

requirements on airlines to provide 

services and compensation to 

consumers experiencing significant 

flight disruptions to, from, or within the 

United States? If so, should those 

requirements apply to itineraries with 

brief and incidental stopover(s) at a 

foreign point without a break in the 

journey like the Refund Rules? Under 

that approach, delays or cancellations to 

flight segments not initiated by the 

passenger, whether controllable by the 

airline or not, would not result in a 

break in journey as only deliberate 

interruptions by the passenger would 

constitute a break in journey. The 

Department solicits comment on 

whether there is any reason not to cover 

brief stopovers at a foreign point 

without a break in the journey. The 

Department also asks whether there are 

flight segments or itineraries involving a 

point in the United States that should be 

excluded from coverage for any areas 

being contemplated by this rulemaking. 

If so, why? Alternatively, should the 

Department consider establishing a 

bright line rule on coverage of flights 

with a break in journey of less than 24 

hours rather than relying on a multifactor test if airlines would be required 

to promptly offer to provide rebooking 

and reimbursements? If so, why? 

(c) Multiple Entities Involved 

Which carrier should bear 

responsibility for providing 

compensation or services such as meals 

or hotels if required during a 

controllable cancellation or delay when 

one carrier ‘‘sold’’ the airline ticket (i.e., 

the merchant of record for the ticket 

transaction),53 but the flight is operated 

by a different carrier? What if the 

merchant of record is a ticket agent? 

Which option would be the easiest and 

clearest for the consumer? Based on 

comments provided by the American 

Society of Travel Advisors in the 

Department’s Refund Rule, it is the 

Department’s understanding that the 

ticket agent’s name appears as the 

merchant of record in five to eight 

percent of all airline ticket transactions 

by credit cards facilitated by ticket 

agents, the majority of which involve 

group bookings, air-inclusive tour 

packages, or resale of consolidated 

fares.54

Should the Department consider 

requiring the merchants of record to be 

responsible for providing compensation 

for controllable delays and 

cancellations? How would the 

Department account for situations 

where the merchant of record is a ticket 

agent with no control on whether a 

flight is delayed or canceled? The 

Department requires merchants of 

record to be responsible for providing 

required refunds for airline ticket 

transactions because they have direct 

visibility of the passengers’ payment 

instruments information and the total 

amounts paid for the itineraries. Does 

that rationale apply to compensation? 

One option under consideration is for 

the operating carrier to be responsible 

for compliance. Would holding the 

operating carrier responsible ensure that 

the carrier that is making the 

operational decisions that affect the 

flight’s performance is accountable? Are 

there reasons the ‘‘marketing carrier’’ 

should be responsible? For example, do 

‘‘marketing carriers’’ often make 

planning decisions such as which 

flights are cancelled? Should 

responsibility be tied to consumer 

perception of which carrier is in 

control? Do consumers associate 

branded codeshare partners and their 

marketing partners, for example 

SkyWest operating as United Express, or 

Jazz Aviation operating as Air Canada 

Express, as the same carrier? If the 

operating carrier were responsible, 

should the operating carrier be allowed 

to rely on their marketing codeshare 

partner to issue compensation to 

consumers or assist in providing 

services such as meals or hotels to 

consumers on their behalf? The 


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55See EC No 261/2004, Article 3.5; APPRs ¶ 2; 

see also Canadian Transportation Agency, 

Application of the Air Passenger Protection 

Regulations: A Guide at 7, available at https://otccta.gc.ca/sites/default/files/application_of_the_air_

passenger_protection_regulations_a_guide.pdf. 

56 14 CFR part 234. 

57 14 CFR 234.4(i). 

58 14 CFR 234.4(h). 

59 Id. 

60BTS has clarified that the Department’s list of 

air carrier caused delays and cancellations 

developed under 14 CFR 234.4 ‘‘should not be 

considered a complete list.’’ BTS Technical 

Reporting Directive #31—On-Time Performance 

(Dec. 12, 2018) at 27, available at https://

www.bts.gov/sites/bts.dot.gov/files/docs/exploretopics-and-geography/topics/airlines-and-airports/ 

224571/technical-directive-no-31-time-2019_1.pdf. 

61Reporting the Causes of Airline Delays and 

Cancellations, 67 FR 70535 (Nov. 25, 2002); see, 

e.g., BTS Technical Reporting Directive #31—OnTime Performance (Dec. 12, 2018). 

Department notes that the assignment of 

responsibility to the operating carrier 

would be consistent with carrier 

responsibility for providing 

compensation and services under the 

EU and Canadian regulations.55 Please 

provide any relevant information 

regarding the EU or Canadian 

regulations that the Department should 

consider. 

Should the Department consider 

assigning responsibility differently, 

such as by assigning joint responsibility 

to carriers with certain arrangements? If 

so, under what carrier arrangements 

would joint responsibility be 

appropriate for domestic or foreign air 

carriers, and what would be the 

appropriate terminology to describe the 

relationship for which joint 

responsibility would apply (e.g., fee-forservice arrangements, branded 

codeshare partnerships, or another 

terminology)? Should carrier 

responsibility vary depending on the 

service, reimbursement, or 

compensation owed? For example, 

should the operating carrier be 

responsible for providing any rebooking, 

while the marketing carrier bears 

responsibility for compensation and 

reimbursements, which the carrier 

could have more time to provide? 

Should the Department require joint and 

several liability in some or all 

circumstances? Should any special 

considerations apply to the assignment 

of responsibility for multi-carrier 

itineraries? Should the final airline in a 

multi-carrier itinerary be responsible for 

any compensation requirements, similar 

to how airlines have generally handled 

responsibility for mishandled baggage 

traveling on multi-carrier itineraries? 

(2) Definition of Controllable 

The Department is considering 

defining ‘‘controllable’’ cancellations or 

delays to be those due in whole or in 

part to any circumstance within the 

control of the airline. Under this 

approach, the requirements of any rule 

would apply if a delay or cancellation 

involves any factors or event within the 

control of the airline, including its 

operating partner, and their employees, 

subcontractors, or other persons 

working on their behalf. This approach 

is being considered to create a standard 

that can be applied consistently across 

carriers. It could also address concerns 

that were noted by a State AG office at 

the December 2021 ACPAC public 

meeting that airlines may choose to 

attribute a delay to weather when the 

delay is also directly attributable to an 

airline. This approach is also consistent 

with the requirements of section 512 of 

the 2024 FAA Act, which instructs the 

Department to direct air carriers to 

establish policies for reimbursements 

for costs of meals, lodging, and 

transportation to and from that lodging 

that are due to flight cancellations and 

significant delays directly attributable to 

the air carrier. 

The Department seeks comment on 

whether this approach for consideration 

is the most appropriate or whether it 

should adopt any alternatives. How 

should the Department treat 

cancellations or delays with multiple 

causes, including when some airline 

cause is involved? The Department’s 

Bureau of Transportation Statistics 

(BTS), which requires U.S. carriers that 

account for at least 0.5 percent of the 

domestic scheduled-passenger revenues 

to report monthly on the causes of 

delayed and cancelled flights, allows 

multiple causes to be reported for delays 

but requires one cause to be reported for 

a cancellation.56 Generally, airlines 

report on the predominant cause of a 

cancellation when there are multiple 

causes for a cancellation. As such, 

instead of treating a delay or 

cancellation as controllable if any cause 

is within the airline’s control, should 

the Department treat a delay or 

cancellation as controllable only if the 

predominant cause of the delay or 

cancellation is within the airline’s 

control? If so, how should the 

Department define predominant cause? 

What effect, if any, would each of those 

approaches likely have on airline 

performance? 

Also, BTS requires airlines to report 

on the causes of delayed flights in five 

broad categories—air carrier, extreme 

weather, National Aviation System, 

security, and late arriving aircraft.57

Airlines may use the reporting category 

of ‘‘late arriving aircraft’’ even if the 

cause of the late arriving aircraft was 

due to a circumstance within control of 

the air carrier. How should the 

Department treat a delay caused by a 

late arriving aircraft for the purposes of 

determining which delays are 

controllable under any rule? Should the 

Department consider the root cause of 

any late arriving aircraft for the 

purposes of determining whether a 

delay resulting from an aircraft arriving 

late is controllable? Flight disruptions 

occurring early in the day can disrupt 

multiple flights using the same aircraft 

downline. If attributing the root cause of 

a late arriving aircraft is appropriate, 

should there be a cut-off point at which 

a root cause should not be considered 

for down-line delays? ‘‘Late arriving 

aircraft’’ is not available as a causal 

category to airlines when reporting 

causes for cancellations to BTS.58 U.S. 

carriers are required to report causes of 

cancellations to BTS in four broad 

categories—air carrier, extreme weather, 

National Aviation System, and 

security.59

The Department is of the tentative 

view that it would not be sufficient to 

define controllable cancellations or 

delays without providing examples of 

the delay and cancellation causes that it 

believes are within the control of the 

carrier. It is considering basing these 

examples on a non-exclusive list used 

by BTS as a guide for the type of 

occurrences that should be reported as 

‘‘air carrier delay or cancellation’’ when 

U.S. carriers categorize delays and 

cancellations of domestic scheduled 

passenger flights and report these delays 

to BTS. This list is available in the latest 

comprehensive BTS reporting directive 

discussing causal reporting dated 

December 12, 2018.60 The BTS reporting 

categories, which were first developed 

by the Department in 2002 through 

notice-and-comment rulemaking, are 

further explained in reporting directives 

issued by BTS.61

Under the December 2018 BTS 

directive, the following events are 

considered air carrier-caused, or in 

other words, due to circumstances 

within air carrier control: aircraft 

cleaning, aircraft damage (except bird 

strikes, lightening/hail damage), airport 

curfew, awaiting the arrival of 

connecting passengers or crew, awaiting 

alcohol test, awaiting gate space, 

baggage loading, cabin servicing, cargo 

loading, catering, computer outages 

involving carrier equipment, crew 

legality (pilot or attendant rest), damage 

by hazardous goods, engineering 

inspection, public health, flight 

paperwork, fueling, gate congestion, 

government forms not properly 

completed (INS, FAA, Agriculture), 


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62BTS Technical Reporting Directive #31—OnTime Performance (Dec. 12, 2018) at 27–28. 

63The Department issued 14 CFR part 234 under 

49 U.S.C. 329, 41708, and 41709. 

64EC No 261/2004, Article 5.3; see also Joined 

Cases C–402/07 and C–432/07, Sturgeon v. Air 

France, 2009 E.C.R. I–10923, ¶ 69 (applying EU 

compensation requirements to delays of three hours 

or more). 

65See EU Interpretive Guidelines at C 214/15–17 

(summarizing cases). 

66The 2013 EU proposal would have included the 

following non-exhaustive list of extraordinary 

circumstances: natural disasters rendering 

impossible the safe operation of the flight; technical 

problems which are not inherent in the normal 

operation of the aircraft, including hidden 

manufacturing defects revealed by the manufacturer 

or a competent authority and which impinges on 

flight safety; security risks, acts of sabotage or 

terrorism rendering impossible the safe operation of 

the flight; life threatening health risks or medical 

emergencies necessitating the interruption or 

deviation of the flight concerned; air traffic 

management restrictions or closure of airspace or an 

airport; meteorological conditions incompatible 

with flight safety; and labor disputes at the 

operating carrier or at essential service providers. 

See Proposal for a Regulation of the European 

Parliament and of the Council Amending 

Regulation (EC) No 261/2004 Establishing Common 

Rules on Compensation and Assistance to 

Passengers in the Event of Denied Boarding and of 

Cancellation or Long Delay of Flights and 

Regulation (EC) No 2027/97 on Air Carrier Liability 

in Respect of the Carriage of Passengers and Their 

Baggage by Air, COM(2013), available at eurlex.europa.eu/legal-content/EN/TXT/PDF/ 

?uri=CELEX:52013PC0130. 

67APPRs, ¶ 19. 

68Canadian Transportation Agency, Consultation 

Paper: Proposed Changes to Clarify, Simplify and 

Strengthen the Air Passenger Protection Regulations 

at 6, available at https://otc-cta.gc.ca/sites/default/ 

files/consultation_paper_-_july_2023.pdf. 

69 Id. 

70Those circumstances considered exceptional 

would include: security risks such as war, political 

instability, illegal acts, sabotage, and terrorism; 

weather or other atmospheric conditions, or natural 

disasters, that make it impossible to safely operate 

the flight, airport operational issues for which the 

airline is not responsible; hidden manufacturing 

defects that come to light and affect flight safety; 

health risks or medical emergencies on route that 

require a flight diversion or discovered shortly 

before flight departure that make it impossible to 

safely operate the flight; air traffic management 

restrictions, airspace closures, and airport closures; 

an official NOTAM; orders or instructions from 

state, law enforcement agency, or airport security 

officials; and labor disruptions at the airline or by 

essential air service providers like airport managers, 

air navigation personnel, or ground handlers. Those 

circumstances not considered exceptional would 

include flight crew or cabin crew unavailability; 

staff shortages at the airline; technical problems that 

are an inherent part of normal airline operations; 

any situation the airline knew about, or should have 

known about, when it sold the ticket to the 

passenger; and any action, or failure to act, by the 

airline or others with which the airline has a 

contractual relationship. Id. at 7–8. 

ground equipment out of service, hot 

brakes restriction, last minute 

passenger, late mail from post office, 

late crew, lavatory servicing, 

maintenance, medical emergency, out of 

service aircraft, oversales, positive 

passenger baggage match, passenger 

services, potable water servicing, preflight check, ramp congestion (blocked 

by another aircraft under carrier’s 

control), ramp service, removal of 

unruly passenger, revised weight sheet, 

shortage of ramp equipment, slow 

boarding or seating, snow removal 

(when it is a carrier ramp service 

function), stowing carry-on baggage, and 

weight and balance delays.62 While not 

currently listed in the BTS directive, the 

Department is also considering 

clarifying that delays and cancellations 

caused by labor strikes of airline 

personnel are controllable because the 

Department believes airlines are best 

capable of addressing or mitigating such 

delays and cancellations through 

effective labor management. The 

Department invites comment on this 

issue. 

Section 511 of the 2024 FAA Act 

instructed BTS to revise its regulation 

covering the ‘‘air carrier’’ category for 

the purposes of airline reporting to BTS 

under 14 CFR 234.4. Section 511 further 

provides a list of causes of delay that 

shall not be included in the ‘‘air carrier’’ 

reporting category in the revised BTS 

reporting regulation: (1) aircraft cleaning 

necessitated by the death of a passenger; 

(2) aircraft damage caused by extreme 

weather, foreign object debris, or 

sabotage; (3) a baggage or cargo loading 

delay caused by an outage of a bag 

system not controlled by a carrier or its 

contractor; (4) cybersecurity attacks 

(provided that the air carrier is in 

compliance with applicable 

cybersecurity regulations); (5) a 

shutdown or system failure of 

government systems that directly affects 

the ability of an air carrier to safely 

conduct flights and is unexpected; (6) 

overheated brakes due to a safety 

incident resulting in the use of 

emergency procedures; (7) unscheduled 

maintenance, including in response to 

an airworthiness directive, manifesting 

outside a scheduled maintenance 

program that cannot be deferred or must 

be addressed before flight; (8) an 

emergency that required medical 

attention through no fault of the carrier; 

(9) the removal of an unruly passenger; 

and (10) an airport closure due to the 

presence of volcanic ash, wind, or wind 

shear. The Department issued the rule 

addressing the reportable causes of 

delay and cancellation in 14 CFR 234.4 

under different statutory authorities 

than those it relies upon in this 

rulemaking, and the 2024 FAA Act does 

not require the Department to 

incorporate those statutory exclusions 

from the ‘‘air carrier’’ reporting category 

described in section 511 in this 

rulemaking.63 Nevertheless, the 

Department welcomes comments on 

whether it should or shouldn’t consider 

the aforementioned causes of delay as 

airline-caused for purposes of this 

rulemaking. 

The Department notes that the EU and 

Canada have requirements for services 

and compensation in similar 

circumstances to those addressed in this 

ANPRM. The EU currently requires 

compensation for cancellations and 

delays of three hours or more, unless the 

airline proves that the cancellation or 

delay is ‘‘caused by extraordinary 

circumstances which could not have 

been avoided even if all reasonable 

measures had been taken.’’ 64 The term 

‘‘extraordinary circumstances’’ has been 

interpreted and narrowly construed in a 

series of decisions by the Court of 

Justice of the European Union.65 In 

2013, the European Commission 

proposed to revise its regulation, EC 

261, to provide a list of causes that 

would be included and excluded from 

the definition of ‘‘extraordinary 

circumstances,’’ but that proposal was 

not finalized.66

The Canadian APPRs currently 

require airlines to provide 

compensation for cancellations and 

delays of three hours or more that are 

within the airline’s control and not 

required for safety purposes.67 In 2023, 

the Canadian Transportation Agency 

(CTA) began a consultation to revise the 

APPRs. In its consultation paper, the 

CTA proposed to eliminate the 

categories in the existing APPRs and to 

move to a mode more similar to EC 261, 

requiring ‘‘compensation for 

inconvenience for all flight disruptions 

unless there are exceptional 

circumstances.’’ 68 To fall within the 

proposed definition of exceptional 

circumstances, the CTA consultation 

paper would require that the event 

causing the disruption ‘‘must have been 

outside the airline’s control, and not 

inherent to the normal exercise of the 

activities of the airline,’’ and that the 

‘‘event could not be avoided even if the 

airline took all reasonable measures to 

do so.’’ 69 The CTA consultation paper 

provided a proposed list of events that 

would and would not constitute 

exceptional circumstances.70

The Department seeks comment on 

whether this approach under 

consideration, which is to rely largely 

on the list of ‘‘air carrier’’ causes from 

the 2018 BTS directive, is the most 

appropriate approach for the 

Department to use to determine whether 

a delay or cancellation is controllable 

and asks for feedback on potential 

alternatives. Are there benefits to using 

the currently applicable EU or Canadian 


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71See https://www.transportation.gov/ 

airconsumer/airline-customer-service-dashboard. 

72 89 FR 32833; 89 FR 65536–37. 

73EC No 261/2004, Articles 5.1(a), 8; APPRs 

¶¶ 10(3), 17, 18. 74APPRs ¶¶ 17, 18. 

categories or any categories for assessing 

delays and cancellations that those 

jurisdictions have proposed but not 

enacted? In addition to the Department’s 

requests for comment on specific EU 

and Canadian requirements throughout 

this ANPRM, the Department also 

requests comment on whether there are 

any additional elements of any current 

or proposed EU or Canadian regulations 

covering controllable cancellations and 

delays (including services and 

compensation available to passengers 

during such delays) that the Department 

should adopt in any rule. 

Should the Department consider any 

alternatives for defining controllable? 

Should the Department consider 

applying requirements for services 

when a delay or cancellation is not 

within the control of the airline? For 

example, the Department is considering 

requiring airlines to provide certain 

services, such as rebooking, meals, and 

hotels on domestic flights, regardless of 

the reason for the flight disruption, as 

failing to provide those services may not 

be ‘‘adequate’’ service under 49 U.S.C. 

41702. If so, what provisions should 

apply and why? 

(3) Rebooking 

(a) General Rebooking Provisions 

Should the Department require 

airlines to offer rebooking, at no 

additional cost, to a passenger whose 

trip is disrupted because of a lengthy, 

controllable flight delay or cancellation 

and, if so, under what circumstances 

should rebooking be required? One 

option the Department is considering is 

requiring airlines to promptly offer 

rebooking without charge on the next 

available flight to any passenger: (1) 

whose flight is cancelled due to 

circumstances, in whole or in part, 

attributable to the carrier; (2) whose 

flight is delayed due to circumstances, 

in whole or in part, attributable to the 

carrier resulting in the passenger 

missing a connection on a single ticket; 

and (3) whose departure on a flight is 

significantly delayed (i.e., delayed three 

hours or more for domestic flight or 

delayed six hours or more for an 

international flight), in whole or in part, 

attributable to the carrier. 

This method is generally consistent 

with the commitments the largest U.S. 

airlines have already made in their 

customer service plans to provide 

rebooking at no additional cost in the 

event of a controllable cancellation or a 

significant controllable delay as 

reflected on the Department’s Airline 

Customer Service Dashboard.71

However, unlike some customer service 

commitments that do not define when a 

delay is significant, the Department is 

considering requiring airlines to offer 

rebooking when the passenger’s 

departure is delayed three hours or 

more for domestic flights and six hours 

or more for international flights due to 

a lengthy, controllable flight delay or 

cancellation. Additionally, regardless of 

the length of delay if a controllable 

delay results in a missed connection, 

the Department is considering requiring 

airlines to offer rebooking on the next 

available flight. 

Under this approach, the rebooking 

offered to a passenger whose departure 

on a flight is significantly delayed 

would be prompt and without charge on 

the next available flight. The 

Department is considering defining 

significant delay to be a delay of three 

hours or more for domestic flight or a 

delay of six hours or more for an 

international flight, in whole or in part, 

attributable to the carrier. This is 

consistent with section 512 of the 2024 

FAA Act, which requires the 

Department to direct certain air carriers 

to establish policies regarding 

reimbursements for the costs of meals, 

lodging, and transportation to and from 

that lodging incurred by passengers 

whose flights are cancelled or 

‘‘significantly delayed.’’ Section 512 

defines ‘‘significantly delayed’’ to mean 

delayed three hours or more for a 

domestic flight and six hours or more 

for an international flight. These 

thresholds are also consistent with the 

definition of a significantly delayed 

flight in section 503 of the 2024 FAA 

Act and Department’s recent Refund 

Rules.72 The Department is considering 

whether to apply the delay standards in 

section 512 of the 2024 FAA Act not 

only to rebooking requirements but also 

to compensation requirements and 

invites comment on whether it should 

do so. Would a consistent definition of 

significant delay that would entitle 

consumers to services or compensation 

promote awareness of passenger rights 

and reduce logistical burdens for 

airlines? 

The Department requests comment on 

the appropriateness of this approach 

under consideration. Should the 

Department adopt this approach or 

should it adopt a different approach? 

For example, EU and Canadian rules 

provide for rebooking when a scheduled 

flight is cancelled, regardless of the 

reason for the cancellation.73 Should the 

Department, like the EU and Canada, 

require airlines to provide rebooking 

regardless of the reason for the 

cancellation based on its authority to 

require safe and adequate interstate 

transportation in 49 U.S.C. 41702? The 

Canadian rules require airlines to 

rebook passengers on another flight if 

their original flight is delayed for three 

hours or more whether that flight is 

domestic or international or if the 

original flight is cancelled.74 Should 

requirements to provide rebooking for 

controllable delays of international 

flights be based on three-hour delays 

instead of six-hour delays? 

Are there any circumstances in which 

rebooking requirements for controllable 

flight disruptions should not apply? 

What rebooking requirements, if any, 

should apply when a passenger does not 

accept the initial rebooking offered by 

the airline after a controllable delay or 

cancellation? Under what circumstances 

do airlines typically offer free 

rebooking? Under what circumstances 

do airlines typically charge for 

rebooking? 

(b) Rebooking on Other Airlines 

The Department is considering 

requiring an airline to offer an affected 

passenger the next available flight 

among flights operated by the airline 

and its branded codeshare partners. As 

discussed earlier in this ANPRM, a 

‘‘branded codeshare partner’’ typically 

operates flights for the mainline carrier 

using the mainline carrier’s name. The 

mainline carrier in this arrangement is 

generally responsible for selling the 

tickets for the flight, and consumers 

likely would consider the two carriers to 

be one entity when purchasing airline 

tickets. 

If no flight operated by that airline or 

its branded codeshare partner would 

depart within 24 hours of the 

passenger’s original scheduled 

departure time, the Department is also 

considering requiring an airline to offer 

rebooking on the next available 

departing flight among those operated 

by that airline, its branded codeshare 

partner, and any carrier with which the 

airline has a commercial agreement, 

interline or codeshare, to transport the 

airline’s passengers. An ‘‘interline 

agreement’’ is a commercial agreement 

that enables the airlines to work 

together in providing services to 

passengers when the passengers travel 

on multiple airlines on a single 

itinerary. The agreement typically 

covers baggage handling, so passengers 

can check bags seamlessly to their final 

destination, and a ticketing agreement, 

to allow a passenger to obtain boarding 


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75See https://www.transportation.gov/ 

airconsumer/airline-customer-service-dashboard. 

76See e.g., American Airlines Customer Service 

Plan updated July 19, 2024, available at https://

www.aa.com/i18n/customer-service/support/ 

customer-service-plan.jsp. 

77See APPRs ¶¶ 17 (1)(a), 18(1). 

78See APPRs ¶¶ 17(1)(a)(iii), 18(1.1)(a). 

79See APPRs ¶¶ 17(1)(b), 18(1.1)(b). 

80Canadian Transportation Agency, Consultation 

Paper: Proposed Changes to Clarify, Simplify and 

Strengthen the Air Passenger Protection Regulations 

at 10, available at https://otc-cta.gc.ca/sites/default/ 

files/consultation_paper_-_july_2023.pdf. 

81 Id. at 11. 

82Canadian Transportation Agency, 

Consultations on Proposed Changes to Strengthen 

the Air Passenger Protection Regulations: What We 

Heard at 11–12, available at https://otc-cta.gc.ca/ 

sites/default/files/consultations_on_proposed_

changes_to_strengthen_the_air_passenger_

protection_regulations_what_we_heard.pdf. 

83 Id. at 12. 

84 Id. 85 Id. 

passes to their destination. Typically, 

interline agreements enable the airlines 

to rebook passengers on one another’s 

flights at a pre-negotiated below-market 

cost when there is an irregular 

operation. 

Several of the largest U.S. airlines 

have committed in their customer 

service plans to rebook passengers on a 

partner airline or another airline with 

which it has an agreement at no 

additional cost when there is a 

controllable cancellation or significant 

controllable delay.75 Some airlines 

condition their commitment to use 

partner carriers on their own flights not 

being available until the next day. This 

is consistent with the option under 

consideration of requiring an airline to 

offer rebooking on any carrier by with 

which the airline has a commercial 

agreement to transport the airline’s 

passengers only if the airline cannot 

provide rebooking within 24 hours 

using its own branded network.76 Some 

airlines do not have interline or 

rebooking agreements with other 

carriers and have not made these 

commitments. Usually, ultra low-cost 

carriers (ULCCs) do not have these 

agreements. 

The Department requests comment on 

whether it should adopt the options 

described for rebooking or if it should 

adopt an alternate option and why. 

What effect, if any, would a requirement 

to provide rebooking on a carrier with 

which an airline has an interline or 

rebooking agreement have on 

competition among airlines, including 

those who do not have interline 

agreements? If the Department should 

require an airline to offer rebooking on 

a carrier with which it has an interline 

or rebooking agreement, should the 

Department require airlines to publish a 

list of their interline partners? 

At what point, if at all, should the 

Department require an airline to offer 

rebooking on another carrier that is not 

its partner airline? The Canadian APPRs 

require large airlines to use any carrier 

to rebook passengers if they cannot 

rebook passengers on their own or a 

partner’s next available flight leaving 

that airport within nine hours for 

controllable cancellations and 

controllable delays of three hours or 

more. For cancellations and delays 

outside the carrier’s control, the 

Canadian APPR requires large airlines to 

use a non-partner carrier if the airline 

cannot rebook passengers on their own 

or a partner’s next available flight 

leaving that airport within 48 hours of 

the departure time on the passenger’s 

ticket for cancellations and delays of 

three hours or more.77 Also, under the 

Canadian APPRs, if the airline cannot 

provide rebooking from the airport 

where the passenger is located that 

departs within 48 hours, large airlines 

must use any airline leaving from a 

nearby airport for rebooking and must 

get the passenger to the other airport 

free of charge.78 Should DOT impose 

similar requirements? What effect, if 

any, would a requirement to provide 

rebooking on any carrier, including nonpartner carriers, have on competition 

among airlines? 

The Canadian APPRs currently do not 

require small airlines to rebook 

passengers using a non-partner airline.79

In 2023, the CTA initiated a 

consultation to revise the APPRs. In its 

consultation paper, the CTA proposed 

to expand requirements to rebook using 

any airline to small airlines, if they 

cannot rebook on their flight or their 

partner’s flight within 24 hours.80 In 

addition, the CTA proposed expanding 

the requirement to use nearby airports 

after 48 hours to small carriers.81

Public comments on the Canadian 

proposal highlight consumer 

organizations’ general support for 

eliminating distinctions between large 

and small airlines to better protect 

passengers.82 Small airlines raised 

issues that rebooking on another airline 

and/or rebooking within 24 hours is not 

realistic if one airline operates from the 

airport or there is a low volume of 

flights.83 Some industry members 

proposed that rebooking obligations 

only apply when there are viable 

rebooking options.84 One airline 

suggested that rebooking on an 

unaffiliated airline should not be a 

requirement and that the passenger 

should be able to choose the rebooking 

options that best suits their needs, 

including being able to choose to rebook 

with the same airline versus a different 

one.85

The Department’s options under 

consideration currently apply the same 

rebooking requirements to smaller 

airlines as to larger airlines. However, 

the Department invites comment on 

whether it should adopt that approach 

or a different one. Should the 

Department not impose any 

requirements or have reduced 

requirements to rebook passengers on 

other airlines after controllable flight 

disruptions by small airlines given these 

airlines may not have interline 

agreements and may need to pay the 

ticket price to transport their passengers 

on another airline? Is it fair to 

passengers flying on small airlines not 

to be provided rebooking on other 

airlines for controllable flight 

disruptions, particularly when the 

network of a small airline may be more 

limited? How, if at all, can the 

Department incentivize large airlines to 

provide rebooking reciprocity to small 

airlines during cancellations and 

lengthy delays, or disincentivize large 

airline practices that prevent 

reciprocity, in order to improve the 

options for consumers and facilitate 

competition? What additional 

requirements might be necessary to 

ensure that small carriers are not 

disadvantaged by the size and scale of 

their networks or other competitive 

factors that impact their ability to 

rebook passengers at the same general 

rate and cost as larger carriers? If small 

airlines are not required to rebook on 

other airlines, how should the 

Department determine which airlines 

are small—based on size of aircraft, 

number of U.S. enplanements, revenue, 

number of employees, or other criteria? 

Also, what is the best way to ensure 

passengers are aware of a two-tiered 

approach? For example, what sorts of 

disclosures, if any, should passengers 

flying on small airlines be provided 

regarding rebooking should there be 

flight disruptions under any two-tiered 

approach? 

In the alternative, should the 

Department require rebooking on other 

airlines by small airlines but consider 

more stringent rebooking requirements 

for large U.S. and foreign airlines with 

flights to, within, and from the United 

States? For example, should the 

Department require large U.S. and 

foreign airlines to provide rebooking on 

any carrier if the airline cannot rebook 

passengers on their own or a partner’s 

next available flight within nine hours 

instead of within 24 hours? This would 

be similar to the current Canadian 


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86Four U.S. carriers—American Airlines, Delta 

Air Lines, United Airlines, and Southwest 

Airlines—exceeded this threshold in 2023, all with 

over 15 percent of domestic scheduled passenger 

revenue. No other carrier comprised more than six 

percent of domestic scheduled passenger revenue. 

See docket at https://www.regulations.gov/docket/ 

DOT-OST-2024-0062/. 

87Eighteen foreign carriers exceeded two million 

total enplanements to and from the United States 

in 2023. See id. 88APPRs ¶¶ 17(2)(a), 18(1.2). 

APPRs, which apply that requirement to 

large airlines. If the Department were to 

adopt more stringent requirements for 

large airlines, how should the 

Department determine which airlines 

are large—based on size of aircraft, 

number of U.S. enplanements, revenue, 

or other criteria? If based on revenue, 

should the focus be on any U.S. carrier 

that accounts for at least 10 percent of 

the domestic scheduled passenger 

revenue in the most recently reported 

12-month period? 86 If based on 

enplanements, is the appropriate 

threshold for foreign air carriers at least 

two million total enplanements to or 

from the United States? 87

(c) Rebooking on Next Available Flight 

The option under consideration is to 

require airlines to offer to rebook 

affected passengers on their next 

available departing flight in the 

passenger’s reserved class of service that 

would advance the passenger to the 

final stop of their itinerary. Does this 

option ensure passengers are 

reaccommodated as soon as possible on 

a reasonable and productive route, 

without adversely affecting passengers 

with confirmed seats or passengers that 

might need priority or blocked seats, 

such as passengers with disabilities? If 

the Department should require 

rebooking on the next available flight, 

how should the Department define 

available? How, if at all, should the 

Department address rebooking for 

multiple passengers traveling on the 

same reservation? How do airlines 

currently approach free rebooking 

during controllable disruptions? How 

long from the time of a cancellation or 

significant delay does it typically take 

for an airline to place a passenger on a 

replacement flight? How do the airlines 

decide which passengers to rebook 

when upcoming flights have limited 

capacity? Are there current industry 

rebooking practices that the Department 

should consider either incorporating 

into a regulation or prohibiting as part 

of this rulemaking? Would rebooking a 

passenger on the next available flight be 

feasible for airlines in practice? Is this 

option appropriate to best serve affected 

passengers? Should any rebooking 

requirement provide more flexibility for 

passengers? Even if the airline can 

rebook the passenger within 24 hours, 

should the Department require an 

airline to offer a passenger the option to 

select any comparable future rebooking 

on that airline in case the original 

itinerary no longer meets the 

passenger’s travel needs? If so, how long 

should airlines be required to make that 

option available, and how far in the 

future should the passenger be 

permitted to rebook without charge? For 

example, should the passenger be 

required to rebook within 24 hours of 

the flight disruption, a week, or another 

time period? Should the future flight 

selected be limited to comparable flights 

departing within a month, a year, or 

another time period? How would the 

Department define comparable future 

rebooking? If rebooking is not 

comparable, should airlines explicitly 

be required in a rule to also provide a 

refund to account for any difference in 

cost or value? For example, should 

airlines explicitly be required in a rule 

to rebook and refund the difference in 

fare if the passenger is downgraded in 

fare class? 

(d) Returning Consumers to the Point of 

Origin When Rebooking Is Declined 

The Department is considering 

requiring that, when a passenger misses 

a connection because of a controllable 

flight cancellation or flight delay and 

the rebooking offered by the airline 

would cause the passenger to be delayed 

in arriving at their final stop 24 hours 

or more, the airline must offer the 

passenger the option of the next 

available return flight to the passenger’s 

original departure point of that portion 

of their itinerary (outbound, 

intermediate, return) at no additional 

cost and a refund of the cost of the 

entire portion of their itinerary with the 

missed connection (including used 

segments of that portion) and all 

subsequent portions of their itinerary. 

This would be similar to a provision of 

the Canadian APPRs, which require an 

airline to provide a refund and return to 

the point of origin if the passenger’s 

travel no longer serves its purpose 

because of the cancellation or lengthy 

delay and the passenger is no longer at 

the point of origin (e.g., is delayed 

departing at a connecting point).88

Should the Department impose a 

requirement on airlines to return 

consumers to the point of origin when 

the passenger is delayed at a connecting 

point and no longer wishes to continue 

their journey? Why or why not? If the 

Department were to impose such a 

requirement, should it apply only for 

extended delays or, similar to the 

Canadian APPRs, be based on whether 

the passenger states that his or her travel 

no longer serves its purpose? Should 

delays at a connecting point of 24 hours 

or more be considered extended delays 

or is there a more appropriate threshold 

on what is an extended delay? Are there 

reasons the Department should not 

require a refund for portions of the 

itinerary already traveled? 

(e) Rebooking Protections When the 

Airline Makes a Significant Change to a 

Passenger’s Flight Itinerary, Including 

for Passengers With Disabilities 

What rebooking protections should 

apply when an airline makes significant 

changes to a passenger’s itinerary, 

including a significant change that 

affects accessibility for a passenger with 

a disability? The Department is 

considering proposing to require 

airlines to promptly offer rebooking at 

no additional cost to a passenger who is 

an individual with a disability (and any 

individuals in the same travel party) 

upon notification that the individual 

decides not to travel on the flight due 

to any of the following changes: the 

individual with a disability (1) is 

downgraded to a lower class of service 

that results in one or more accessibility 

features needed by the individual 

becoming unavailable; (2) is scheduled 

to depart from, arrive to, or connect 

through one or more airports that are 

different from the original itinerary; or 

(3) is scheduled to travel on substitute 

aircraft on which one or more 

accessibility features available on the 

original aircraft needed by the 

individual are unavailable. The 

Department is considering proposing 

that the airline must offer rebooking on 

the next departing flight by that airline 

or its branded codeshare partner that 

advances the passenger to the final stop 

of their itinerary, accommodates the 

individual with a disability, and has 

open seats for the individual and for all 

other in the same travel party. The 

Department is considering proposing to 

apply this requirement regardless of 

whether the reason for the change was 

within the airline’s control. In addition, 

if no flight operated by that airline or its 

branded codeshare partner would 

depart within 24 hours of the 

passenger’s original scheduled 

departure time, the Department is also 

considering requiring an airline to offer 

rebooking on the next available 

departing flight among those operated 

by that airline, its branded codeshare 

partner, and any carrier with which the 

airline has a commercial agreement, 

interline or codeshare, to transport the 

airline’s passengers. 


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89See Comment from Paralyzed Veterans of 

America at 2, available at https://

www.regulations.gov/comment/DOT-OST-2022- 

0089-5262, comment from United Spinal 

Association, available at https://

www.regulations.gov/comment/DOT-OST-2022- 

0089-5304. 

90See Comment from Paralyzed Veterans of 

America at 3. 

91See Final Report, ACAA Advisory Committee 

Recommendations at 9–10 (Feb. 4, 2022), available 

at https://www.regulations.gov/document/DOTOST-2018-0204-0040. 

92See Hinnerk Gnutzmann and Piotr 

S

 ́piewanowki, Can Regulation Improve Service 

Quality? Evidence from European Air Passenger 

Rights, European University Institute Working 

Paper, RSCAS 2018/44 (2018) at 8, available at 

https://cadmus.eui.eu/bitstream/handle/1814/ 

58304/RSCAS_2018_44.docx.pdf?sequence=1&

isAllowed=y. 93Flights arriving to the EU from locations 

outside the EU are covered by EC 261 only if the 

carrier is an EU carrier. See id. at 1 (explaining that 

differences in EC 261 coverage based on the 

nationality of the carrier ‘‘makes it possible to 

identify the impact of the regulation while allowing 

for carrier fixed effects and controlling for routetime effects (e.g., caused by airspace congestion)’’). 

94See Study on the Current Level of Protection 

of Air Passenger Rights in the EU, No. MOVE/B5/ 

2018–541 (2020), available at https://op.europa.eu/ 

en/publication-detail/-/publication/f03df002-335c11ea-ba6e-01aa75ed71a1. 

95 Id. at 20. 

In the rulemaking, Refunds and Other 

Consumer Protections, two disability 

rights advocacy groups, Paralyzed 

Veterans of America and United Spinal 

Association, commented that, from the 

perspective of passengers with 

disabilities, any change to the 

origination, connection, and destination 

airport should be considered a 

‘‘significant change of flight 

itinerary.’’ 89 These commenters stated 

that when booking flights, passengers 

with disabilities may rely on the 

specific accessibility features of an 

airport to select the flights and itinerary, 

and this may include selecting a 

particular connecting airport based on 

the accessibility features needed to 

accommodate their disabilities during 

the layover time. In addition, the 

Paralyzed Veterans of America noted 

that a ‘‘refund’’ is purposeless if the 

passenger is stranded and requested the 

Department require airlines to 

‘‘expeditiously locate and offer 

alternative transportation that meets the 

specific needs of the passenger with a 

disability.’’ 90

For example, when finding alternative 

transportation for individuals with 

disabilities who use wheelchairs, it is 

imperative that the alternative 

transportation selected is one where the 

passenger’s wheelchair can be safely 

stowed. In February 2022, the 

Department’s Air Carrier Access Act 

(ACAA) Advisory Committee issued a 

report that recognized the importance of 

logistical planning to ensure that 

wheelchairs are safely accommodated 

on aircraft. The Advisory Committee 

unanimously agreed on the benefit of 

passengers with disabilities completing 

airline forms describing their 

wheelchairs (e.g., device dimensions, 

battery type) and recommended that a 

group that includes disability 

organizations, airlines, airports, aircraft 

manufacturers, and wheelchair 

manufacturers work together to improve 

consistency within existing airline 

forms for handling wheelchairs. It is the 

Department’s understanding that this 

working group, led by the International 

Air Transport Association (IATA), 

intends to complete its work by the end 

of 2024.91 To ensure that any rebooking 

requirements provide equitable access 

to air transportation to people with 

disabilities, there may be a need for 

consistent forms for wheelchairs. 

Should the Department require a 

consistent wheelchair handling form 

across airlines for air transportation to, 

from and within the United States? If so, 

what information should be included? 

Should the Department adopt the form 

developed by the working group led by 

IATA? 

Should the Department propose the 

rebooking requirements for passengers 

with disabilities regardless of whether 

the reason for the cancellation or 

significant change was within the 

airline’s control as stated earlier in this 

section? Should the Department only 

require airlines to provide rebooking 

without charge to passengers who are 

individuals with disabilities when 

lengthy delays and cancellations are 

within the airline’s control or 

responsibility? Are there circumstances 

in which airlines should not be required 

to accommodate passengers by 

rebooking the passenger on another 

carrier with which the airline has a 

codeshare or interline agreement? Are 

there circumstances in which airlines 

should be required to accommodate 

passengers on a carrier with which the 

airline does not have a codeshare, 

interline, or any other agreement? If the 

Department proposes that airlines must 

provide free rebooking to members in 

the same travel party as a passenger 

with a disability, how should the 

Department define ‘‘travel party,’’ and 

how can airlines determine which 

passengers belong to the same ‘‘travel 

party?’’ Should the travel party be 

determined based on whether the 

passengers purchased their tickets in a 

single transaction, are on the same 

reservation or on linked Passenger 

Name Record (‘‘PNR’’), or based on 

other criteria? 

Should airlines be required to offer 

the option of free rebooking for any 

cancellation or significant delay or 

change of a domestic flight that qualifies 

for a refund under section 503 of the 

2024 FAA Act or under the 

Department’s Refund Rules? 

(4) Compensation 

(a) Compensation Amounts 

The Department is considering 

requiring airlines to pay cash 

compensation to passengers whose trip 

is disrupted because of a cancellation or 

delay due, in whole or in part, to any 

circumstance within the control of the 

airline. The Department seeks comment 

on the effect that requiring 

compensation for lengthy, controllable 

delays and cancellations may have on 

airline performance and profitability as 

well as the effect that such requirements 

would have on consumers. A working 

paper by the European University 

Institute supports that European 

compensation and service requirements 

(discussed later in this ANPRM) have 

reduced the likelihood and duration of 

flight delays under that regime, finding 

‘‘an economically important and 

statistically significant effect of EC261 

regulation [covering compensation and 

services] on both departure and arrival 

delay, as well as on-time 

performance.’’ 92 In reaching that 

conclusion, the working paper 

compared flights operating on the same 

route around the same time that were 

covered by EC 261 with those that were 

not.93 A separate study contracted by 

the European Commission documented 

an overall increase in the number of 

cancellations and lengthy delays of 

flights covered by the EU regulation 

between 2011 and 2018.94 That study 

also documented reduced delays on 

flights covered by the EU regulation 

compared with those that were not, 

concluding that it was ‘‘possible’’ that 

the EU regulation ‘‘has a marginal 

impact on the proportion of flights 

delayed’’ but stating that the impact 

‘‘does not appear to be significant 

compared to other factors.’’ 95 In 

addition, the Department requests 

comment on how requiring cash 

compensation may impact consumer 

behavior. For example, would requiring 

cash compensation make consumers 

impacted by cancellations and lengthy 

flight delays more likely to continue to 

travel by air in the future? 

The Department is contemplating 

proposing that cash compensation 

would be due to a passenger whose 

arrival at the final stop of the itinerary 

is delayed by three hours or more for a 

domestic flight and six hours or more 

for an international flight because of a 


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96See APPRs, ¶ 19(1). 97 89 FR 32833. 98APPRs ¶ 19(1). 99Conversions from CAD to USD estimated based 

on the average conversion rate on the Bank of 

Canada website for the week of September 3– 

September 10, 2024. 100The Department rounded the converted values 

of Canadian compensation to the nearest $25 for 

purposes of providing compensation amounts for 

comment in this ANPRM. Conversion rates from 

Canadian to U.S. Dollars are provided in the docket 

at https://www.regulations.gov/docket/DOT-OST2024-0062/. 

101The value was weighted by the proportion of 

travel that is business and personal. See U.S. 

Department of Transportation, Benefit-Cost 

Analysis Guidance for Discretionary Grant 

Programs, 2024 Update (Dec. 5, 2023), Table A–2, 

p. 40, n. 2 and 3, available at https://

www.transportation.gov/sites/dot.gov/files/2023-12/ 

Benefit%20Cost%20Analysis%20Guidance

%202024%20Update.pdf. The value of travel time 

in air transportation is $47.70 per hour for personal 

travel and $80.20 for business travel, with a ratio 

of 88.2 percent personal travel and 11.8 percent 

business travel. 

102The largest U.S. airlines report certified flight 

performance data for their domestic scheduled 

operations to BTS on a monthly basis. Based on 

2023 BTS T–100 domestic market-based traffic data, 

these airlines account for more than 95 percent of 

domestic passenger air traffic. Bureau of 

Transportation Statistics, T–100 Market Data, 

available at https://www.regulations.gov/docket/

DOT-OST-2024-0062/. Additional information on 

the Department’s calculations is available in the 

docket at https://www.regulations.gov/docket/DOTOST-2024-0062/. 

controllable flight cancellation or delay. 

This structure is similar to that used in 

the Canadian APPRs.96 In addition, 

using a three-hour delay threshold for 

domestic flights and six-hour thresholds 

for international flights to determine 

whether compensation is owed is 

consistent both with the definition of 

significantly delayed in section 512 of 

the 2024 FAA Act and with the 

definition of significantly delayed flight 

in the Department’s recent Refund 

Rules.97 The Department invites 

comment on these time thresholds for 

compensation, including whether any 

compensation should be required for 

delays of less than three hours. 

To determine the compensation 

amounts that should be paid to 

consumers, the Department is 

considering two options. The first 

option is using amounts comparable to 

Canadian amounts of compensation 

applicable to large airlines. The second 

option is to base the cash compensation 

amounts on the value of passenger time 

and the weighted average flight delay. 

The Department seeks public comment 

on these options and will also consider 

additional options recommended by 

commenters. 

For the first option, the Department is 

considering using the same 

compensation amounts required for 

large airlines under the Canadian 

APPRs, converted from Canadian to U.S. 

dollars. Canada currently applies the 

following tiers of cash compensation 

requirements to cancellations and flight 

delays that are within the airline’s 

control and not required for safety: 98

CANADIAN COMPENSATION REQUIREMENTS 99

Large carriers Small carriers 

Delayed Arrival of 3–5:59 hours ..... $400 Canadian Dollars (CAD), Approximately $295 

U.S. Dollars (USD).

$125 (CAD), Approximately $92 USD. 

Delayed Arrival of 6–8:59 hours ..... $700 (CAD), Approximately $517 USD ..................... $250 (CAD), Approximately $185 USD. 

Delayed Arrival of 9+ hours ............ $1,000 (CAD), Approximately $738 USD .................. $500 (CAD), Approximately $369 USD. 

The Department is considering 

whether to use amounts similar to 

Canada to ensure U.S. passenger 

compensation requirements are in line 

with other similar international 

requirements. 

Under this first option, the 

Department is considering requiring an 

airline to pay compensation of $300 

USD to a passenger whose arrival at the 

final stop of a domestic flight is delayed 

at least three hours but less than six 

hours; $525 USD to a passenger whose 

arrival at the final stop of a domestic 

flight is delayed at least six hours but 

less than nine hours; and $750 USD to 

a passenger whose arrival at the final 

stop of a domestic flight is delayed at 

least nine hours.100 The Department is 

considering requiring an airline to pay 

$525 USD to a passenger whose arrival 

at the final stop of an international flight 

is delayed at least six hours but less 

than nine hours; and $750 USD to a 

passenger whose arrival at the final stop 

of an international flight is delayed at 

least nine hours. If the Department 

proposes this option, should it also 

include reduced compensation amounts 

for small airlines like the Canadian 

APPRs? Why or why not? 

The second option the Department is 

considering is to require airlines to pay 

compensation based on the 

Department’s hourly value of travel time 

savings for air travel from DOT’s 

Benefit-Cost Analysis Guidance for 

Discretionary Grant Programs 101 and 

the weighted average flight segment 

delay of flights delayed at least three but 

less than six hours, at least six hours but 

less than nine hours, and nine hours or 

more on flight segments within the 

United States using 2022 and 2023 fullyear domestic flight performance data 

collected by BTS.102 Under this second 

option the Department would require an 

airline to pay compensation of $200 to 

a passenger whose arrival at the final 

stop of a domestic flight is delayed at 

least three hours but less than six hours; 

$375 to a passenger whose arrival at the 

final stop of a domestic flight is delayed 

at least six hours but less than nine 

hours; and $775 to a passenger whose 

arrival at the final stop of a domestic 

flight is delayed at least nine hours. The 

Department is considering requiring an 

airline to pay $375 to a passenger whose 

arrival at the final stop of an 

international flight is delayed at least 

six hours but less than nine hours; and 

$775 to a passenger whose arrival at the 

final stop of an international flight is 

delayed at least nine hours. 

In calculating the compensation 

amounts for the second option, the 

Department relies on the BTS data 

because that data is reported and 

certified correct by U.S. airlines to the 

Department. The Department recognizes 

that BTS data have some limitations as 

applied to this rulemaking. Notably, 

BTS only collects flight performance 

data from U.S. airlines for domestic 

flight segments, and the data does not 

reflect passenger trip delay. 

Accordingly, the data used to establish 

any compensation amounts from BTS 

data would necessarily be limited to 

domestic segment-based delays, not 

overall delays for passengers arriving at 

their destinations. The Department 

invites comment on whether it should 

use BTS data to establish any 

compensation amounts or whether an 

alternate data source would provide 

information more appropriate to 

establishing compensation amounts. 

To arrive at the dollar value for 

compensation for purposes of soliciting 

comment on option two in this ANPRM, 

the Department multiplied its estimated 


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103Additional information about these 

calculations is provided in the docket for this 

rulemaking, available at https://

www.regulations.gov/docket/DOT-OST-2024-0062/. 

104See U.S. Department of Transportation, 

Benefit-Cost Analysis Guidance for Discretionary 

Grant Programs, 2024 Update (Dec. 5, 2023), Table 

A–2, p. 40, n. 2 and 3. 

105U.S. Department of Transportation, Revised 

Departmental Guidance on Valuation of Travel 

Time in Economic Analysis (Sept. 27, 2016) at 1, 

https://www.transportation.gov/sites/dot.gov/files/ 

docs/2016%20Revised%20Value%20of%20

Travel%20Time%20Guidance.pdf. 

106 Id. at 4–7. 

107Canadian regulations define a large carrier as 

one that has transported a worldwide total of two 

million passengers or more during each of the two 

preceding calendar years. APPRs ¶ 1. 

108EC No 261/2004, Articles 5, 7. 

109 Id. By court decision, the EU’s compensation 

requirements also apply to delays of three hours or 

more. Joined Cases C–402/07 and C–432/07, 

Sturgeon v. Air France, 2009 E.C.R. I–10923, ¶ 69. 

110Conversions from Euros to USD estimated 

based on the conversion rate on the Forbes 

Advisory website on September 16, 2024. 

111The value was weighted by the proportion of 

travel that is business and personal. See U.S. 

Department of Transportation, Benefit-Cost 

Analysis Guidance for Discretionary Grant 

Programs, 2024 Update (Dec. 5, 2023), Table A–2, 

p. 40, n. 2 and 3, available at https://

www.transportation.gov/sites/dot.gov/files/2023-12/

Benefit%20Cost%20Analysis%20Guidance

%202024%20Update.pdf. The value of travel time 

in air transportation is $47.70 per hour for personal 

travel and $80.20 for business travel, with a ratio 

of 88.2 percent personal travel and 11.8 percent 

business travel. 

112 See APPRs ¶ 19(1). 

weighted average arrival delay for each 

compensation tier (3–5:59 hours; 6–8:59 

hours; 9+ hours) 103 by the Department’s 

hourly value of travel time savings for 

air travel from DOT’s Benefit-Cost 

Analysis Guidance for Discretionary 

Grant Programs. This hourly value of 

travel time savings for air transportation 

is $51.54.104 The Department developed 

its value of travel time savings ‘‘to be 

used in all DOT benefit-cost or costeffectiveness analyses.’’ 105 Although the 

value of travel time savings was not 

specifically developed for the purpose 

of assessing the value of time lost due 

to air travel delays, the Department 

views the factors used to establish the 

value of travel time savings—trip 

purpose, passenger characteristics, 

passenger income, mode and distance of 

transportation, and passenger comfort— 

are also potentially relevant to time lost 

due to air travel delays.106

The Department also closely reviewed 

the EU compensation regime when 

developing this ANPRM. The EU, like 

Canada, uses a three-tiered 

compensation system, but those 

compensation regimes have different 

criteria. Canadian compensation 

requirements are based on the length of 

a passenger’s delayed arrival and 

whether the carrier is a large or small 

carrier.107 The EU compensation 

amounts are based on the distance and 

location of the flight (i.e., whether the 

flight is entirely within the EU), with a 

reduction of 50 percent if passengers 

arrive with delays of less than two, 

three, or four hours depending upon the 

distance and location of the flight.108

The EU applies the following 

requirements for compensation in the 

form of cash, electronic bank transfer, 

bank order or bank check for 

cancellations and delays of three hours 

or more unless the airline proves that 

the cancellation or delay is ‘‘caused by 

extraordinary circumstances which 

could not have been avoided even if all 

reasonable measures had been 

taken.’’ 109

EU COMPENSATION REQUIREMENTS 110

Compensation Reduced compensation if rerouting is provided 

All flights 1500km or less ............................................ 250 Euros, Approximately $278 

USD.

Reduced to 125 Euros (approximately $139 USD) if 

passenger arrives less than 2 hours later than 

scheduled. 

All flights entirely within the EU and all flights between the EU and a location outside the EU between 1500 and 3500 km.400 Euros, Approximately $445 

USD.

Reduced to 200 Euros (approximately $223 USD) if 

passenger arrives less than 3 hours later than 

scheduled. 

All other flights ............................................................ 600 Euros, Approximately $668 

USD.

Reduced to 300 Euros (approximately $334 USD) if 

passenger arrives less than 4 hours later than 

scheduled. 

Should the Department use a tiered 

model if it imposes compensation 

requirements or should the Department 

require a single level of compensation 

for all lengthy, controllable delays and 

controllable cancellations? A tiered 

approach based on the length of delay 

as under options one and two would be 

similar to Canadian regulatory 

requirements. It would also reflect that 

passengers lose more time and are likely 

to experience greater inconvenience and 

discomfort during longer delays and 

may provide added incentive for 

airlines to rebook delayed and cancelled 

passengers on replacement flights 

arriving close to the passengers’ 

originally scheduled arrival times. 

Instead of a tiered approach based on 

length of delay, should the Department 

adopt a different compensation model, 

such as a model more similar to the EU, 

with different compensation amounts 

applicable to domestic and international 

flights? 

If the Department requires airlines to 

pay compensation, what methodology 

should the Department use to establish 

compensation amounts? Should the 

Department establish compensation 

amounts using a methodology that 

provides compensation based on the 

value of a passenger’s lost time, such as 

the methodology in option two 

discussed above that would calculate 

compensation amounts using the 

Department’s hourly value of travel time 

savings for air travel from DOT’s 

Benefit-Cost Analysis Guidance for 

Discretionary Grant Programs and BTS 

data on flight segment delays? 111 Or, 

instead of determining any 

compensation amounts based on the 

value of a passenger’s time, should the 

Department establish any compensation 

amounts with reference to the rates used 

in other jurisdictions as under option 

one? Are there additional or alternate 

data sources that the Department should 

examine in order to establish any 

compensation amounts? Should the 

Department consider a compensation 

requirement that includes periodic 

updates to compensation amounts, such 

as for inflation using the consumer price 

index or based on another method? 

Should any compensation 

methodology impose lower 

compensation requirements on some 

airlines, similar to the current Canadian 

regulatory requirements which apply 

lower compensation requirements to 

small airlines, or exclude some airlines 

entirely? 112 For example, should the 

Department impose lower compensation 

requirements on airlines that meet the 

definition of a small entity for purposes 

of the Regulatory Flexibility Act or 


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113 Under the Regulatory Flexibility Act carriers 

that exclusively provide air transportation with 

aircraft originally designed to have a maximum 

passenger capacity of 60 seats or less or a maximum 

payload capacity of 18,000 pounds or less are small 

businesses. See 14 CFR 399.73. 

114 Four U.S. carriers, American Airlines, Delta 

Air Lines, United Airlines, and Southwest Airlines, 

comprised 10 percent or more of domestic 

scheduled passenger revenue in 2023, all with over 

15 percent. No other carrier comprised more than 

six percent of domestic scheduled passenger 

revenue. See docket at https://www.regulations.gov/ 

docket/DOT-OST-2024-0062/. 

115 Eighteen foreign carriers exceeded two million 

total enplanements to or from the United States in 

2023. See id. 

116 14 CFR 234.2. 117 APPRs ¶ 19(2). 118 See 89 FR 32833. 

airlines that are small based on other 

criteria? 113

Should the Department apply higher 

compensation requirements to those 

carriers that comprise a large percentage 

of domestic scheduled-service passenger 

revenues (e.g., 10 percent or greater) 114

or comprise a large number of total 

enplanements to and from the United 

States (e.g., have two million or more 

total enplanements to and from the 

United States)? 115 Would higher 

compensation requirements further 

incentivize the largest carriers to make 

operational changes to reduce the 

prevalence of controllable cancellations 

and delays? 

Are there circumstances in which 

compensation requirements should not 

apply? For example, should 

compensation requirements not apply if 

the airline provides sufficient advance 

notice of the cancellation or delay? 

Among other options, the Department is 

considering not requiring compensation 

if the airline notifies the passenger of 

the flight cancellation or arrival delay at 

least eight days before the first 

scheduled departure for that part of the 

trip (e.g., before the scheduled departure 

for the first flight segment of an inbound 

or outbound portion of the itinerary). 

An eight-day time period is consistent 

with the BTS reporting rule which 

defines a cancelled flight as a flight not 

operated, but that was listed in the 

carrier’s computer reservation system 

within seven calendar days of the 

scheduled departure.116 Under those 

rules, a flight removed for the carrier’s 

reservation system more than seven 

days out are not reportable to the 

Department. Should the Department 

instead adopt a longer or shorter period 

during which any exclusion would 

apply, such as 14 days before the first 

scheduled departure? If commenters 

recommend a period longer than eight 

days, please provide a rationale for the 

recommended approach along any 

available data source that the 

Department can consult to estimate the 

number of flights that are cancelled 

more than eight days in advance of the 

flight. Should higher compensation 

requirements apply to cancellations and 

delays that occur closer in time to the 

scheduled flight to reflect the likelihood 

of greater inconvenience and costs to 

passengers from last-minute 

cancellations and delays? If so, at what 

point in time should higher 

compensation requirements apply? 

What compensation, if any, should be 

required if a passenger does not accept 

any flight offered by the airline and 

instead elects to receive a refund? In 

that circumstance, should the 

Department require compensation in the 

full amount that would otherwise be 

required based on the earliest arriving 

rebooking offered by the airline? Is there 

any reason for compensation not to be 

required when a passenger decides not 

to continue travel because of a 

controllable delay or cancellation and 

receives a refund? Canadian regulations 

require the airline to pay the lowest 

level of its tiered compensation 

structure if the passenger elects to 

accept a refund rather than 

rebooking.117 Should the Department 

similarly require reduced compensation 

in those circumstances? If the passenger 

elects to receive a refund, should the 

Department require different 

compensation if the airline is unable to 

offer prompt rebooking (for example, 

because alternate flights are unavailable) 

than if the airline offers prompt 

rebooking? 

What compensation, if any, should be 

required if a passenger accepts 

rebooking, but does not accept the 

earliest flight offered by the airline? 

Should the compensation amount be 

calculated based on the earliest 

scheduled arrival of the itinerary offered 

by the carrier? The Department requests 

comment on whether there are other 

options that the Department should 

consider. 

Do certain groups of passengers, such 

as passengers with disabilities, 

encounter unique costs associated with 

significant cancellations and delays? If 

so, should a compensation requirement 

address the potential for increased costs 

for certain groups of passengers, and 

how should it address these costs? 

(b) Form of Compensation 

The Department is contemplating 

requiring airlines to pay compensation 

in the form of cash or a cash equivalent 

for controllable flight disruptions rather 

than in alternative formats such as 

travel credits or vouchers or airline 

miles. In the Department’s recent 

Refund Rules, the Department defined 

‘‘cash equivalent’’ as a form of payment 

that can be used like cash, including but 

not limited to a check, a prepaid card, 

funds transferred to the passenger’s 

bank account, funds provided through 

digital payment methods (e.g., PayPal, 

Venmo), or a gift card that is widely 

accepted in commerce.118 The 

Department does not consider a form of 

payment to be ‘‘cash equivalent’’ if 

consumers bear the burden for 

transaction, maintenance, or usage fees 

related to the payment. The Department 

notes that cash or a cash equivalent 

would provide the highest degree of 

flexibility to a consumer 

inconvenienced by a controllable 

cancellation or delay in how and when 

to spend the required compensation. 

Should the Department propose to 

allow airlines to provide compensation 

in a form other than cash or cash 

equivalent, and if so, under what 

circumstances would a non-cash option 

provide more benefit to consumers? 

Given that cash or a cash equivalent has 

no restriction on how and where it can 

be spent, under what conditions, if any, 

might non-cash compensation with 

limited use represent a better option? If 

non-cash or non-cash equivalent 

compensation is an acceptable 

compensation option, are additional 

consumer protections needed to ensure 

consumers are treated fairly and to 

ensure fair competition? How would the 

Department determine whether 

consumers have received the required 

compensation value with non-cash 

alternative compensation options? For 

example, if airlines were to offer miles 

or rewards points, how would the 

Department determine whether the 

miles or points represent a dollar value 

equivalent to or greater than the 

compensation amount required, 

particularly for miles or points that 

expire, cannot be converted into cash or 

a cash equivalent, and/or have a 

dynamic dollar value that changes at the 

discretion of the airline? How would the 

Department ensure that any vouchers or 

airline miles provided as an alternative 

to cash or cash equivalent compensation 

provide a benefit and maintain a value 

equal to or greater than cash or a cash 

equivalent? What misleading or unfair 

practices, if any, may occur when 

airline miles, travel credits or vouchers, 

or other similar types of compensation 

are offered in lieu of cash or cash 

equivalent compensation? 

(c) Automatic Compensation Payments 

Should the Department require 

airlines to make automatic cash or cash 

equivalent compensation payments to 


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119 See https://www.transportation.gov/ 

airconsumer/airline-customer-service-dashboard. 

120 See, e.g., Alaska Airlines Customer Service 

Plan, available at https://www.alaskaair.com/ 

content/about-us/customer-commitment/customercommitment-delay-care (guaranteeing a hotel only 

if the passenger is delayed overnight at ‘‘an airport 

located 100 or more miles away from [the 

passenger’s] home’’), American Airlines Customer 

Service Plan (updated July 19, 2024), available at 

https://www.aa.com/i18n/customer-service/ 

support/customer-service-plan.jsp (guaranteeing a 

hotel if the passenger is delayed overnight ‘‘away 

from [their] city of residence’’). 

121 See Statement of Administration Policy, 

Senate Substitute Amendment to H.R. 3935—FAA 

Reauthorization Act of 2024 (May 8, 2024), 

available at https://www.whitehouse.gov/wpcontent/uploads/2024/05/SAP-SSA-HR3935.pdf. 

122 The Canadian regulation currently requires 

airlines to provide ‘‘food and drink in reasonable 

quantities, taking into account the length of the 

wait, the time of day and the location of the 

passenger.’’ See APPRs section 14(1)(a). Similarly, 

EC 261 requires ‘‘meals and refreshments in a 

reasonable relation to the waiting time.’’ Article 

9(1)(a). The EU has further explained that this 

means that ‘‘operating air carriers should provide 

passengers with appropriate care corresponding to 

the expected length of the delay and the time of day 

(or night) at which it occurs, including at the 

transfer airport in the case of connecting flights, in 

order to reduce the inconvenience suffered by the 

passengers as much as possible, while bearing in 

mind the principle of proportionality.’’ EU 

Interpretative Guidelines. The United Kingdom’s 

Civil Aviation Authority explains on its website 

that, in the case of a covered delay or cancellation, 

the airline must provide passengers with meals and 

hotel ‘‘until it is able to fly you to your destination, 

no matter how long the delay lasts or what has 

caused it.’’ See https://www.caa.co.uk/passengers/ 

resolving-travel-problems/delays-and-cancellations/ 

cancellations/. 

consumers who are entitled to receive 

compensation? Under what 

circumstances, if any, should the 

Department require airlines to pay cash 

or cash equivalent compensation 

automatically, without requiring the 

submission of information by the 

consumer? What should a regulatory 

framework establishing automatic cash 

or cash equivalent compensation 

payment process look like to ensure 

automatic payments are provided 

effectively and efficiently to affected 

passengers? What information would 

airlines need to process automatic cash 

and cash equivalent compensation 

payments? Would cash-equivalent 

compensation (e.g., a Visa gift card) 

enable airlines to provide compensation 

without having to obtain passenger 

information, such as bank account 

information? If automatic compensation 

is required, how should the regulatory 

framework address disagreements 

between an airline and passenger about 

the compensation amounts or whether a 

given cancellation or delay was outside 

of the airline’s control? Further, in cases 

where compensation is owed under the 

laws of multiple jurisdictions, how 

could a regulatory framework for 

automatic compensation enable 

passenger choice to receive 

compensation under the passenger’s 

preferred regime? 

Instead of requiring automatic 

compensation, should the Department 

allow airlines to require passengers to 

submit requests for compensation? What 

would be the necessary elements of 

such claims process, if needed? Should 

airlines be required to accept 

compensation requests through airline 

websites, by email, or by phone? If the 

Department were to allow airlines to 

require passengers to request 

compensation, are there ways to ensure 

that all passengers get the compensation 

they are entitled to receive? For 

example, if one passenger submits a 

compensation request, should that be 

sufficient to trigger a requirement that 

all passengers on the flight receive 

compensation if owed? Should airlines 

be required to proactively provide a way 

to request compensation as part of a 

notification process? What other 

requirements might be necessary to 

ensure that a request process results in 

all passengers getting the compensation 

they are entitled to, ensure that the 

request process is easy to navigate, and 

ensure that compensation disbursement 

is prompt? 

In circumstances in which a third 

party, such as a private- or public-sector 

employer, has paid for a passenger’s 

ticket, should any compensation be paid 

to the passenger or should it be paid to 

the third-party payor? Are there 

challenges to either approach? 

(5) Meals, Lodging, and Transportation 

to and From Lodging 

As reflected on the Department’s 

Airline Customer Service Dashboard, 

the largest U.S. airlines all currently 

guarantee in their customer service 

plans that they will cover a meal for 

passengers affected by a cancellation or 

delay within the airline’s control that 

results in a passenger waiting three 

hours or more, and all but one of the 

largest U.S. carriers currently commit to 

providing hotel accommodations and 

travel to and from the hotel when there 

are controllable overnight delays and 

cancellations.119 Some of those airline 

policies contain limitations, for 

example, limiting their hotel guarantees 

to non-local passengers and limiting any 

reimbursements for hotels to reasonable 

costs.120

Section 512 of the 2024 FAA Act 

requires the Department to ‘‘direct all 

air carriers providing scheduled 

passenger interstate or intrastate air 

transportation to establish policies 

regarding reimbursement for lodging, 

transportation between such lodging 

and the airport, and meal costs incurred 

due to a flight cancellation or significant 

delay directly attributable to the air 

carrier.’’ For the purposes of section 

512, ‘‘significantly delayed’’ means, 

‘‘the departure or arrival at the 

originally ticketed destination 

associated with such transportation has 

changed—(1) in the case of a domestic 

flight, three or more hours after the 

original scheduled arrival time; and (2) 

in the case of an international flight, six 

or more hours after the original 

scheduled arrival time.’’ As explained 

earlier in this ANPRM, the 

Administration views the 2024 FAA Act 

to ‘‘set a floor that the Department of 

Transportation could build on as 

deemed appropriate by the Secretary of 

Transportation.’’ 121

(a) Service Standards 

Consistent with the Administration’s 

position that the 2024 FAA Act is a 

floor, the Department is considering 

requiring airlines to guarantee in their 

customer service plans that they will 

cover the cost of meals when a 

controllable cancellation results in 

passengers waiting for three hours or 

more for a new flight or when a flight 

delay results in passengers waiting for 

three hours or more. This is consistent 

with the commitments that the large 

U.S. airlines have made at the urging of 

DOT. Should the Department use the 

three-hour delay threshold from the 

Dashboard for any meal requirements 

for both domestic and international 

delays? Or should it apply different 

thresholds, such as requiring airlines to 

cover the cost of meals for domestic 

delays of three hours or more and 

international delays of six hours or 

more? 

Canadian, EU, and United Kingdom 

regulatory meal requirements consider 

waiting time.122 Should the Department 

similarly require airlines to cover more 

than one meal for longer delays based 

on actual or expected length of delay, 

based on a daily per diem allotment per 

passenger, or based on another metric? 

Should the Department consider 

requirements ensuring airlines cover a 

meal with certain qualities, for example 

that the meal includes a non-alcoholic 

beverage and an entre ́e or that the meal 

meets the dietary restrictions of the 

affected passenger? 

The Department is also considering 

requiring airlines to guarantee in their 

customer service plans that they will 

cover lodging for passengers affected by 

an overnight delay or cancellation or 

reimburse passengers for expenses 

incurred for lodging. If the Department 

proposes this approach, how should 


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‘‘overnight delay or cancellation’’ be 

defined? The Department notes that 

neither the EU nor Canadian regulations 

define when a delay is overnight for 

purposes of their requirements for 

overnight accommodations. How do 

those requirements apply in practice in 

those jurisdictions? Should the 

Department consider passengers 

delayed past 10 p.m. or 11 p.m. to be 

affected by an overnight delay or 

cancellation and thus entitled to receive 

lodging, or is there another measure that 

the Department should consider? 

Should the original scheduled time of 

the flight and length of delay be 

considered in making this 

determination (e.g., a flight was 

originally scheduled for 9 p.m. and is 

delayed for two hours to 11 p.m.)? 

Should the Department use the three 

hours for domestic delays and six hours 

for international delays from the 2024 

FAA Act to establish a minimum 

waiting time that must occur before a 

passenger would be entitled to receive 

overnight accommodation? How should 

the length of the delay impact lodging 

requirements when a consumer 

experiences excessive delay (e.g., 12 

hours) but the delay is not overnight? 

Should any requirement to cover 

lodging be based on the duration of the 

delay because the passenger may need 

to obtain lodging for multiple nights 

during an extended cancellation or 

delay? 

How should the Department define 

lodging? Should the Department define 

lodging to include types of 

accommodation beyond traditional 

hotels and motels, and if so, what types 

of accommodation should be included? 

Are there circumstances when an airline 

should be required to cover lodging 

with more than one bedroom for a 

traveling party, and if so, in what 

circumstances? How should a traveling 

party be defined? 

In addition, the Department is 

considering requiring any lodging 

provided by the airline must be 

reasonable in quality (i.e., a safe and 

healthy environment that is accessible 

to a passenger who self identifies as a 

person with a disability) and be nearby 

to the airport, when available. The 

Department seeks comment on any 

options that would ensure lodging 

requirements appropriately address 

passenger needs, including any 

standards to determine what is 

reasonable and nearby for the purposes 

of lodging, as well as any additional or 

different requirements that the 

Department should apply. The 

Department also requests comment on 

whether airlines should be required to 

cover ancillary lodging costs such as 

extra bedding, a baby crib, or parking at 

the lodging, and if so, which ancillary 

costs should be required to be covered. 

The Department is considering 

allowing airlines to limit lodging to nonlocal travelers as provided in some 

current airline policies. If the 

Department allows airlines to limit 

lodging to non-local travelers, how 

should the Department define which 

travelers are ‘‘local’’? If the Department 

does not require airlines to cover the 

cost of lodging for local travelers, 

should the Department require airlines 

to cover travel to and from the 

passenger’s residence or airport parking 

costs associated with a controllable 

cancellation or lengthy, controllable 

delay for those travelers? 

The Department is also considering 

requiring airlines to guarantee in their 

customer service plans that they cover 

transportation to and from lodging to 

affected passengers, including 

transportation that is accessible to a 

passenger who self identifies as a person 

with a disability. What costs to and from 

lodging should airlines be required to 

cover? For example, should airlines be 

required to cover the cost of shuttle 

service, driver service such as taxi or 

ride share, rental car, or gas mileage for 

the passenger’s vehicle or for friend’s 

vehicle if picking up the passenger? 

Should the Department require airlines 

to cover the cost of a driver service such 

as a taxi or ride share to and from the 

lodging in all circumstances, or some 

circumstances, and if so, which 

circumstances should not be covered 

and why? The Department is 

considering allowing airlines to provide 

in their policies that they will not cover 

services if the passenger is provided 

sufficient advance notice of a 

cancellation or delay. If the Department 

proposes this approach, what time 

period should constitute sufficient 

advance notice? For example, should 

the Department allow airlines not to 

cover meals if the passenger is notified 

of the delay or cancellation at least 12 

hours in advance of the scheduled 

departure because the passenger is less 

likely to need to purchase a meal at the 

airport in that circumstance? Should 

any differing time periods apply to any 

requirements for meals and lodging and 

transportation to and from lodging? If 

so, why? 

What requirements for meals, lodging, 

and transportation to and from lodging, 

if any, should apply if a passenger 

accepts a refund, rather than rebooking, 

in the event of a controllable 

cancellation or a lengthy, controllable 

flight delay? 

Should the Department, under its 

authority to ensure ‘‘adequate’’ 

transportation in 49 U.S.C. 41702, 

extend any requirement that airlines 

cover the costs of meals, and lodging for 

overnight delays, and transportation to 

and from lodging to all cancellations 

and lengthy flight delays when the 

passengers are flying domestically, 

regardless of whether the cancellation or 

delay is controllable? Why or why not? 

Are there additional circumstances in 

which the Department should consider 

requiring these services? 

(b) Upfront Services 

The Department is seeking comment 

on the best way to ensure that 

passengers receive the services they are 

entitled to, with minimal expense and 

hassle. The Department is considering 

proposing a multi-tiered approach for 

airlines to provide meals, lodging, and 

transportation to and from lodging to 

passengers. Under this approach, an 

airline would be required to dispense all 

upfront vouchers or credits for these 

services as soon as the airline becomes 

aware of the flight disruption that 

triggers a passenger’s entitlement to 

services, and, if the airline does not 

offer and provide those services upfront, 

then the airline would be required to 

reimburse passengers for the cost of 

those services. 

The Department is of the tentative 

view that passengers are best served 

when airlines cover the upfront costs of 

meals, lodging, and travel to and from 

lodging during flight disruptions so that 

passengers do not have to pay out of 

pocket for those services. Passengers 

may not have the means to pay for these 

unexpected costs, and some passengers 

may not be able to navigate the process 

of procuring some or all these services 

on their own. Under this option, the 

required services would be provided by 

airlines directly through physical or 

electronic vouchers, e-credits, or other 

mechanisms that ensure passengers 

receive the services upfront. The 

Department is concerned that airlines’ 

current policies and procedures for 

distributing services upfront may be 

inadequate for meeting passengers’ 

needs and may not be consistently or 

evenly provided, particularly during 

widespread flight disruptions. Airlines 

have disparate policies and processes 

for distribution and may not plan 

appropriately to have enough vouchers 

or credits to provide them to all affected 

passengers who are entitled to them. 

Moreover, frontline staff may lack 

training or instruction regarding when 

passengers are entitled to each of these 

services, what services are available 

upfront, who to prioritize when 

vouchers or credits are limited, and 

what costs will be reimbursed when 


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123 See https://www.gsa.gov/travel/plan-book/ 

per-diem-rates. 

vouchers or credits run out or are not 

provided. Additionally, long waits to 

receive vouchers or credits for services 

may result in passengers giving up and 

paying for these services directly 

themselves. 

How should the Department define 

‘‘upfront’’ in terms of process and 

timing? What, if any, requirements 

might be necessary to ensure that the 

manner and timeliness of distribution is 

adequately meeting passengers’ needs? 

Does this option best address the 

Department’s concerns, or would an 

alternate approach better ensure that 

passengers receive needed services with 

minimal expense and hassle? 

(c) Reimbursements for Services 

The Department is contemplating 

proposing to require airlines to 

reimburse passengers for costs incurred 

for meals, lodging, and transportation to 

and from lodging when the airline fails 

to offer those services or those services 

are not offered and provided in a timely 

manner. In lieu of providing vouchers or 

credits, some airlines currently 

reimburse passengers for the costs of the 

services during wide-spread 

controllable disruptions. However, 

airlines do not consistently disclose 

when passengers are eligible for 

reimbursements for services and what 

costs the airlines will reimburse for and 

how much they will cover. Moreover, 

because the process for requesting 

reimbursement is different for each 

airline, it can be difficult for passengers 

to navigate, and the timing of the 

reimbursement payment is discretional 

and often lengthy. 

The Department believes frustrated 

and inconvenienced passengers may 

purchase a service that the airline 

should be providing if the passenger is 

unaware of when and where a service or 

voucher is available. How should any 

proposed requirements ensure that 

passengers are aware of the airlines’ 

obligations to provide a service, so that 

the consumer would not purchase the 

service out-of-pocket expecting 

reimbursement? How should any 

requirements for airlines to provide 

reimbursements apply, if at all, if the 

passenger purchased the service 

themselves before the airline notifies the 

passenger that the airline will provide 

the service? Should the Department 

require airlines to offer passengers the 

option of choosing reimbursements even 

if the airline also offers to provide a 

service or a voucher for the service? 

Should airlines be required to provide 

documentation that the passenger 

received the service upfront in lieu of 

reimbursement, if so, what kind of 

documentation should be required? 

(i) Automatic Reimbursements for 

Services 

The Department is considering how 

reimbursements for services should be 

provided, including whether 

reimbursements should be automatic or 

requested by the passenger. Due to 

concerns that the process for requesting 

reimbursements can be cumbersome for 

passengers, one option would be to 

require automatic reimbursements in 

some circumstances without submission 

of information by the passenger. The 

Department is considering requiring 

automatic reimbursement for a 

minimum amount after an established 

time period if an affected passenger 

does not submit receipts of their costs 

for meals, lodging, or transportation to 

and from lodging, and the airline has no 

documentation of the passenger 

receiving the service upfront. On the 

other hand, if the passenger submits 

receipts during that time period, the 

Department is considering proposing 

that the airline must reimburse the 

passenger for those expenses up to a 

pre-established maximum threshold for 

each service. The Department invites 

comment on what time period should 

apply to the submission of receipts and 

the minimum and maximum amounts 

for reimbursement if the Department 

proposes this approach. In addition, in 

both scenarios, the Department would 

consider requiring the airline to provide 

the reimbursement within a defined 

period and solicits comment on what 

that time period should be. 

The Department is seeking comment 

on this approach and what requirements 

would be necessary to ensure that it 

produces the expected outcomes for 

passengers. Under what circumstances, 

if any, should the Department require 

airlines to pay reimbursements 

automatically, without requiring the 

submission of information by the 

consumer? How would the automatic 

payment process work? Would an 

airline need to obtain a passenger’s bank 

account information to process a 

reimbursement? Would cash-equivalent 

compensation (e.g., a Visa gift card) 

enable airlines to provide 

reimbursements without having to 

obtain passenger information, such as 

bank account information? 

Would establishing minimums and 

maximums make obtaining meals, 

lodging, and transportation to and from 

lodging more predictable for consumers 

during a cancellation or lengthy delay 

compared with current airline practices? 

If it proposes this approach, how should 

the Department determine the minimum 

and maximum amounts that airlines 

must reimburse consumers for these 

services? Should these values be 

nationwide or regional? Should the 

Department adjust these minimum and 

maximum values periodically to 

account for market pricing? Should the 

values for lodging be adjusted 

seasonally? Should any minimum 

payments for meals, lodging, and 

transportation to and from lodging, 

apply regardless of whether the 

consumer submits receipts? If the 

Department establishes minimum 

reimbursement amounts, should the 

Department require that if the airline 

offers a meal, lodging, or transportation 

to and from the lodging instead of 

providing reimbursement for that 

service, the airline must provide a 

service with equal value to the 

minimum reimbursement amount? How 

should that value be determined? 

Should the airline be required to 

provide reimbursement unless they 

present the passenger with 

documentation that the passenger 

received the service upfront? 

Instead of requiring reimbursements 

based on minimum and maximum cost 

thresholds, should the Department 

require airlines to provide 

reimbursements for ‘‘reasonable’’ costs? 

If so, how should the Department 

establish the amount of reasonable 

reimbursements in any proposal? For 

example, should the Department 

establish reasonable reimbursement 

amounts for lodging or meals based on 

what airlines provide their own crews, 

based on per diem rates established by 

the U.S. General Services 

Administration, or using another 

methodology? 123

(ii) Claims for Reimbursement 

For passenger claims for 

reimbursements supported by receipts, 

the Department is considering whether 

it is appropriate to require airlines to 

approve and pay a complete claim or 

deny a complete claim, with a written 

explanation of the airline’s reason for 

denying the claim if it does so, no later 

than a set timeframe after the complete 

claim is received. The Department 

invites comment on what timeframe 

should apply if the Department 

proposes this approach. If the 

Department does not propose automatic 

reimbursements for services during a set 

time period, should it establish a set 

time period during which passengers 

must submit claims for reimbursement, 

and, if so, what should that time period 

be? 

Should the Department place any 

limits on information that airlines may 


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124 See CTA, Air Passenger Protection 

Regulations—Regulatory Impact Analysis 

Statement, available at https://otc-cta.gc.ca/eng/airpassenger-protection-regulations-regulatory-impactanalysis-statement (noting that ‘‘passengers would 

only be able to receive compensation . . . if they 

have not already received compensation for the 

same event under a different regime’’), see also EC 

No 261/2004, Article 3.1(b). Canadian regulations 

clarify that mere eligibility for compensation under 

another jurisdiction’s law is not a permissible basis 

for refusing compensation. See APPRs, ¶ 3(3). 

125 EC No 261/2004, Article 3.1(b); see also EU 

Interpretive Guidelines at C 214/7. 126 EU Interpretive Guidelines at C 214/7. 

127 See ACPAC December 8 and 9, 2022 Meeting 

Minutes at 26, available at https://

www.regulations.gov/document/DOT-OST-2018- 

0190-0110. 

request from passengers to process their 

claims or establish a minimum basis for 

what qualifies as a ‘‘claim’’ the airline 

must accept? What other requirements, 

if any, should the Department establish 

for any process for consumer-provided 

information? For example, should the 

Department require airlines to establish 

their own policies and procedures for 

which reimbursements will be approved 

and not approved, provide opportunity 

for passengers to resubmit claims if 

corrections are needed and establish an 

internal appeals process? Should the 

Department require that airlines make 

any claims process streamlined, easy to 

access, available at any time, and with 

clear and conspicuous instructions and 

disclosures of airline policies for 

compensation or reimbursements? Are 

there circumstances in which the 

Department should permit airlines to 

reject, rather than respond to, 

submissions that do not provide 

sufficient information to process the 

claim? If an airline rejects a claim for 

reimbursement because they provided 

the service upfront, should the airline 

be required to present documentation of 

the passenger having received the 

service? 

(6) Cancellations and Delays Covered by 

Foreign Legal Requirements 

As previously discussed, EU and 

Canadian regulations require services 

and compensation similar to those on 

which the Department solicits comment 

in this ANPRM. How can the 

Department best avoid duplicative 

burdens on airlines? Are there 

provisions that are needed to ensure 

passengers receive favorable outcomes 

when more than one law applies to a 

controllable cancellation or lengthy 

controllable delay? 

Both the EU and Canadian regulations 

limit entitlement to compensation if the 

passenger has already received 

compensation for the same delay or 

cancellation in another jurisdiction.124

The EU regulation also limits 

entitlement to other services if the 

passenger has already received that 

service for the same delay or 

cancellation under another regime.125

The European Commission has further 

clarified that if a passenger accepts only 

compensation or a service (but not both) 

under a different regime, the passenger’s 

entitlement to receive the compensation 

or service not accepted is unaffected 

under EU law.126 Should the 

Department adopt similar limits to those 

under EU and Canadian regulations? 

How do these limits operate in practice? 

Can airlines efficiently provide a 

consumer their choice of benefits when 

more than one jurisdiction’s regulation 

applies to an event? 

The Department is considering 

whether to require the airline to notify 

passengers of any differences in value of 

reimbursements, services, and 

compensation owed under any DOT 

requirements and the law of a foreign 

jurisdiction, if applicable, so that 

passengers would have the ability to 

accept a reimbursement, service, or 

compensation on an informed basis 

when the laws of multiple jurisdictions 

apply. The Department seeks comment 

on whether these options are 

appropriate, feasible for airlines, and 

benefit consumers, particularly if the 

Department were to decide to require 

automatic compensation and 

reimbursements. Would the value of 

services, such as lodging or a meal, 

likely be the same under any DOTimposed requirement and the law of a 

foreign jurisdiction? 

(7) Information Provided to Passengers 

The Department is concerned that 

airlines do not sufficiently inform 

passengers about their rights when there 

are controllable cancellations and 

lengthy delays that entitle passengers to 

services such as meals, lodging, and 

rebooking. To address harm to 

consumers, the Department solicits 

comment on whether to require airlines 

to: (1) notify passengers of the required 

or promised services, (2) disclose 

proactively whether the cancellation or 

delay is controllable and would entitle 

passengers to services, (3) respond to 

passengers’ questions about reasons for 

disruptions and whether they qualify for 

services, (4) make information about 

services and reimbursements clear, easy 

to find, and accurate, and (5) explain the 

differences, if there are any, in the 

policies between codeshare partners for 

services and reimbursements. 

If the Department requires airlines to 

provide compensation or rebooking 

without charge or to cover the costs of 

meals, lodging, and transportation to 

and from lodging, should the 

Department require notifications of 

available compensation, rebooking, or 

costs of meals, lodging, and 

transportation to and from lodging? As 

discussed earlier in this ANPRM, at the 

December 2022 ACPAC meeting, the 

ACPAC recommended that the 

Department issue a regulation requiring 

airlines to notify affected consumers of 

the availability of services and 

amenities for controllable delays and 

cancellations, with three of the four 

members voting in favor of the 

recommendation.127 The Department is 

considering requiring airlines to 

promptly notify consumers when a 

required service, reimbursement, or 

compensation is owed. The Department 

is considering requiring airlines to 

provide such notification when the 

airline expects that an entire flight 

segment will be subject to a controllable 

cancellation or delay that would entitle 

the passengers to services, 

reimbursements, and compensation. As 

an alternative, the Department is also 

considering instead requiring 

individualized notifications when only 

some passengers on a flight would be 

owed compensation, rebooking, or a 

service (e.g., when some passengers on 

a flight miss a connecting flight due to 

a controllable cancellation or delay) and 

seeks comment on whether it is feasible 

for airlines to do so. Are there 

challenges to providing individualized 

notifications or to providing these 

notifications to passengers who 

purchase air transportation from ticket 

agents, and if so, how should the 

Department address such challenges? 

What would be the costs for airlines to 

provide individualized notifications? 

Where and by what means should any 

required notifications be provided? The 

Department is considering requiring that 

airlines provide notifications on the 

carrier’s primary website, to passengers 

who contact the airline’s customer 

service representative, at the boarding 

gate area, and/or through a method that 

the passenger has elected to receive 

flight status notifications. Should these 

or different notification methods apply? 

Should the Department require airlines 

to establish reasonable policies, 

procedures, and/or training for airline 

customer service staff to ensure that 

staff provide passengers proper 

notification of available 

reimbursements, compensation, and 

services and provide services promptly 

where applicable? If airlines are 

permitted to require passengers to 

affirmatively request compensation or 

services, should airlines be required to 


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128 See Southwest Airlines Co., DOT Order No. 

2023–12–11, Consent Order (Dec. 15, 2023). 

proactively provide information on how 

to make that request or provide a link 

or other avenue for submitting the 

request in any notification regarding the 

cancellation or delay? The Department 

also requests comment on what 

requirements are needed to ensure 

passengers who identify to airlines as 

persons with disabilities receive 

effective notification. 

What timing requirements, if any, 

should apply to any notifications? The 

Department is considering a proposal 

that notifications for reimbursements, 

services, and compensations must be 

promptly provided to consumers. If the 

Department should require prompt 

notifications, is additional clarification 

needed regarding when a notification is 

‘‘prompt?’’ Should the Department 

establish a set timeframe following the 

occurrence of a cancellation or delay 

during which an airline must provide 

any required notifications? The 

Department would expect airlines to 

begin to provide notifications soon after 

the delay or cancellation rather than 

hours after it. Should different 

timeframes apply to any notifications 

about compensation and to any 

notifications about rebooking or services 

that are likely needed during or soon 

after the delay or cancellation? 

Should the Department require 

airlines to notify passengers in real time 

of the specific cause of a lengthy delay 

or cancellation? If so, how can the 

Department ensure that information 

provided by the airline is accurate? 

(8) Timely Customer Service 

Section 505 of the 2024 FAA Act 

requires that air carriers selling tickets 

for scheduled passenger air 

transportation on an aircraft that, as 

originally designed, has a passenger 

capacity of 30 or more seats must 

maintain, without charge and available 

at all times: (1) a customer service 

telephone line staffed by live agents, (2) 

a customer chat option that allows for 

customers to speak to a live agent 

within a reasonable time, to the greatest 

extent practicable, or (3) a monitored 

text messaging number that enables 

customers to communicate and speak 

with a live agent directly. Section 505 

authorizes DOT to issue such rules as 

may be necessary to carry out the 

requirement and provides that airlines 

must comply with section 505’s 

requirements ‘‘without regard to 

whether the Secretary has promulgated 

any rules to carry out’’ section 505. 

In enforcement matters, the 

Department has taken the position that 

the practice of not providing adequate 

customer service assistance when a 

carrier cancels or significantly changes 

a passenger’s flight is an unfair practice 

and also that the practice is deceptive 

when a carrier advertises a particular 

service to consumers as an available 

means of obtaining customer service 

assistance and fails to provide that 

service or fails to provide the service 

within a reasonable time period.128

However, the Department’s regulations 

do not currently set forth specific 

requirements for timely customer 

service assistance or contain provisions 

addressing section 505 of the 2024 FAA 

Act. The Department is considering 

whether to propose minimum timely 

customer service requirements, 

particularly for passengers affected by 

cancellations and delays. Should the 

Department establish specific minimum 

wait times for customer service during 

or after a cancellation or lengthy delay, 

and what should the minimum wait 

times be or what should minimum wait 

times be based on? Should any 

minimum customer service wait time be 

based on the type of customer service 

the passenger seeks, for example, 

customer service about rebooking, 

refunds, compensation, etc.? Should the 

Department consider requiring airlines 

to make call center service available at 

all times during a disruption, regardless 

of whether the other means of assistance 

are available as well? Should the 

Department consider as an option 

letting airlines determine a minimum 

standard of customer service and 

requiring the airline to put it in their 

customer service plan? The Department 

invites comments on these options for 

improving the timeliness of customer 

service. 

(9) Reporting and Recordkeeping 

What recordkeeping and reporting 

requirements should apply to the areas 

covered by this ANPRM, if any? The 

Department is considering proposing 

that airlines must submit periodic 

reports regarding compliance with any 

requirements adopted. The intent of this 

option would be to enable the 

Department to monitor airline 

implementation of and compliance with 

any requirements effectively and 

efficiently and to facilitate enforcement 

of noncompliance, when appropriate. 

Such reports may include, for example, 

information about cancellations and 

lengthy flight delays that the airline 

determined were controllable and not 

controllable and the specific bases for 

the carrier’s determinations; information 

about notifications, services, 

reimbursements, and compensation 

provided; and information about 

requests for services and claims for 

reimbursements and/or compensation, 

including the airline’s responses. 

Should the Department require reports 

and, if so, should the Department 

require airlines to report on a fixed 

interval? Should different reporting 

requirements, if any, apply to foreign 

carriers, and, if so, why? 

Regulatory Notices 

A. Executive Order 12866 (Regulatory 

Planning and Review) and DOT 

Regulatory Policies and Procedures 

The Office of Management and Budget 

(OMB) has determined that this ANPRM 

is a significant regulatory action under 

Executive Order 12866. Executive Order 

12866 requires agencies to provide a 

meaningful opportunity for public 

participation. Accordingly, we have 

asked commenters to answer a variety of 

questions to elicit practical information 

about alternative approaches and 

relevant data. These comments will help 

the Department evaluate whether a 

NPRM is needed and if so, the content 

of the NPRM. If the Department issues 

a NPRM after the completion of the 

comment period on this ANPRM, it will 

prepare a regulatory impact analysis for 

the proposed rule, assessing the 

potential benefits, costs, and transfers. 

The Department seeks any information, 

data, and analysis that would help the 

Department understand the economic 

impacts of the potential regulatory 

options discussed within this ANPRM. 

B. Executive Order 13132 (Federalism) 

This ANPRM has been analyzed in 

accordance with the principles and 

criteria contained in Executive Order 

13132 (‘‘Federalism’’). This ANPRM 

does not propose any requirement that 

(1) has substantial direct effects on the 

States, the relationship between the 

National Government and the States, or 

the distribution of power and 

responsibilities among the various 

levels of government, (2) imposes 

substantial direct compliance costs on 

State and local governments, or (3) 

preempts State law. States are already 

preempted from regulating in this area 

by the Airline Deregulation Act, 49 

U.S.C. 41713. Therefore, the 

consultation and funding requirements 

of Executive Order 13132 do not apply. 

C. Executive Order 13175 

This ANPRM has been analyzed in 

accordance with the principles and 

criteria contained in Executive Order 

13175 (‘‘Consultation and Coordination 

with Indian Tribal Governments’’). 

Because none of the options on which 

we are seeking comment would 


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99782 Federal Register / Vol. 89, No. 238 / Wednesday, December 11, 2024 / Proposed Rules 

129See 14 CFR 399.73. 

130See 40 CFR 1508.4. 

131 Id. 

significantly or uniquely affect the 

communities of the Indian Tribal 

governments or impose substantial 

direct compliance costs on them, the 

funding and consultation requirements 

of Executive Order 13175 do not apply. 

D. Regulatory Flexibility Act 

When a Federal agency is required to 

publish a notice of proposed rulemaking 

(5 U.S.C. 553), the Regulatory Flexibility 

Act of 1980 (5 U.S.C. 601 et seq.) 

requires the agency to conduct an initial 

regulatory flexibility analysis (IRFA). 

An IRFA describes the impact of the 

rule on small entities (5 U.S.C. 603). An 

IRFA is not required if the agency head 

certifies that a rule will not have a 

significant economic impact on a 

substantial number of small entities (5 

U.S.C. 605). Under the Regulatory 

Flexibility Act, carriers that exclusively 

provide air transportation with aircraft 

originally designed to have a maximum 

passenger capacity of 60 seats or less or 

a maximum payload capacity of 18,000 

pounds or less are small businesses.129

If the Department proposes to adopt the 

consumer protections discussed in this 

ANPRM, it is possible that it may have 

some impact on small entities. We 

invite comment to facilitate DOT’s 

assessment of the potential impact of 

adopting the possible regulatory 

requirements discussed in this ANPRM 

on small entities. 

E. Paperwork Reduction Act 

Under the Paperwork Reduction Act 

(44 U.S.C. 3501 et seq.), no person is 

required to respond to a collection of 

information unless it displays a valid 

OMB control number. This ANPRM is 

not covered by the Paperwork 

Reduction Act because it does not 

propose any new information collection 

burdens. If the Department proposes to 

adopt information collections in a 

NPRM, the burdens associated with 

such a collection will be analyzed at 

that time. 

F. Unfunded Mandates Reform Act 

The Department has determined that 

the requirements of Title II of the 

Unfunded Reform Act of 1995 do not 

apply to this document. 

G. National Environmental Policy Act 

The Department has analyzed the 

environmental impacts of this ANPRM 

pursuant to the National Environmental 

Policy Act of 1969 (NEPA) (42 U.S.C. 

4321 et seq.) and has determined that it 

is categorically excluded pursuant to 

DOT Order 5610.1C, Procedures for 

Considering Environmental Impacts (44 

FR 56420, Oct. 1, 1979). Categorical 

exclusions are actions identified in an 

agency’s NEPA implementing 

procedures that do not normally have a 

significant impact on the environment 

and therefore do not require either an 

environmental assessment (EA) or 

environmental impact statement 

(EIS).130 In analyzing the applicability 

of a categorical exclusion, the agency 

must also consider whether 

extraordinary circumstances are present 

that would warrant the preparation of 

an EA or EIS.131 Paragraph 4(c)(6)(i) of 

DOT Order 5610.1C provides that 

‘‘actions relating to consumer 

protection, including regulations’’ are 

categorically excluded. The Department 

does not anticipate any environmental 

impacts, and there are no extraordinary 

circumstances present in connection 

with this rulemaking. 

Signed this 3rd day of December, 2024, in 

Washington, DC. 

Peter Paul Montgomery Buttigieg, 

Secretary of Transportation. 

[FR Doc. 2024–28930 Filed 12–10–24; 8:45 am] 

BILLING CODE 4910–9X–P 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

26 CFR Part 1 

[REG–117213–24] 

RIN 1545–BR37 

Accounting for Disregarded 

Transactions Between a Qualified 

Business Unit and Its Owner 

AGENCY: Internal Revenue Service (IRS), 

Treasury. 

ACTION: Notice of proposed rulemaking. 

SUMMARY: This document contains 

proposed regulations relating to the 

determination of taxable income or loss 

and foreign currency gain or loss with 

respect to a qualified business unit. The 

proposed regulations include an 

election that is intended to reduce the 

compliance burden of accounting for 

certain disregarded transactions 

between a qualified business unit and 

its owner. This document also includes 

a request for comments relating to the 

treatment of partnerships and controlled 

foreign corporations. 

DATES: Written or electronic comments 

and requests for a public hearing must 

be received by March 11, 2025. 

ADDRESSES: Commenters are strongly 

encouraged to submit public comments 

electronically via the Federal 

eRulemaking Portal at https://

www.regulations.gov (indicate IRS and 

REG–117213–24) by following the 

online instructions for submitting 

comments. Requests for a public hearing 

must be submitted as prescribed in the 

‘‘Comments and Requests for a Public 

Hearing’’ section. Once submitted to the 

Federal eRulemaking Portal, comments 

cannot be edited or withdrawn. The 

Department of the Treasury (Treasury 

Department) and the IRS will publish 

for public availability any comments 

submitted to the IRS’s public docket. 

Send paper submissions to: 

CC:PA:01:PR (REG–117213–24), Room 

5203, Internal Revenue Service, P.O. 

Box 7604, Ben Franklin Station, 

Washington, DC 20044. 

FOR FURTHER INFORMATION CONTACT: 

Concerning the proposed regulations, 

Adam G. Province at (865) 329–4546; 

concerning submissions of comments, 

requests for a public hearing, and access 

to a public hearing, Publications and 

Regulations Section at (202) 317–6901 

(not toll-free numbers) or by email to 

publichearings@irs.gov (preferred). 

SUPPLEMENTARY INFORMATION: 

Authority 

This document contains proposed 

additions and amendments to 26 CFR 

part 1 (Income Tax Regulations) 

addressing the application of section 

987 of the Internal Revenue Code (Code) 

and related provisions (the ‘‘proposed 

regulations’’). The additions and 

amendments are issued under sections 

987 and 989, pursuant to the express 

delegations of authority provided under 

those sections. The express delegations 

relied upon are referenced in the 

Background section of this preamble. 

The proposed regulations are also 

issued under the express delegation of 

authority under section 7805 of the 

Code. 

Background 

This document contains proposed 

regulations under section 987 of the 

Code. Section 987 applies to any 

taxpayer that has a qualified business 

unit (QBU) with a functional currency 

other than the dollar. Section 987(1) and 

(2) provide rules for determining and 

translating taxable income or loss 

(‘‘section 987 taxable income or loss’’) 

with respect to the QBU. In addition, 

foreign currency gain or loss must be 

determined under section 987(3) 

(‘‘section 987 gain or loss’’), which 

requires proper adjustments (as 

prescribed by the Secretary) for transfers 

of property between QBUs of the 


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