Document ID: DOT-OST-2022-0109-0020
Agency: dot
Document Type: Proposed Rule
Title: Enhancing Transparency of Airline Ancillary Service Fees
Posted Date: 2022-10-20T04:00Z

[Federal Register Volume 87, Number 202 (Thursday, October 20, 2022)]
[Proposed Rules]
[Pages 63718-63738]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-22214]

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DEPARTMENT OF TRANSPORTATION

Office of the Secretary

14 CFR Part 399

[Docket No. DOT-OST-2022-0109]
RIN 2105-AF10

Enhancing Transparency of Airline Ancillary Service Fees

AGENCY: Office of the Secretary (OST), Department of Transportation 
(DOT).

ACTION: Notice of proposed rulemaking (NPRM).

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SUMMARY: The Department proposes to require U.S. air carriers, foreign 
air carriers, and ticket agents to clearly disclose passenger-specific 
or itinerary-specific baggage fees, change fees, and cancellation fees 
to consumers whenever fare and schedule information is provided to 
consumers for flights to, within, and from the United States. The 
Department also proposes to require these entities to clearly disclose 
passenger-specific or itinerary-specific fees for adjacent seating 
whenever fare and schedule information is provided to consumers 
traveling with young children on flights to, within, and from the 
United States, and make these fees transactable. The Department further 
proposes to require that carriers provide useable, current, and 
accurate information regarding baggage fees, change fees, cancellation 
fees, and adjacent seating fees if any to ticket agents that sell or 
display the carrier's fare and schedule information. This rulemaking 
implements the Executive order on Promoting Competition in the American 
Economy, which directs the Department to take various actions to 
promote the interests of American workers, businesses, and consumers, 
including considering initiating a rulemaking to ensure that consumers 
have ancillary fee information at the time of ticket purchase.

DATES: Comments should be filed by December 19, 2022. Late-filed 
comments will be considered to the extent practicable. Petitions for a 
hearing pursuant to 14 CFR 399.75(b)(1) must also be filed by December 
19, 2022.

ADDRESSES: You may file comments identified by the docket number DOT-
OST-2022-0109 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, between 9 a.m. and 5 p.m. ET, Monday 
through Friday, except Federal holidays. Commenters using this method 
of delivery should contact Docket Services at 202-366-9826 or 202-366-
9317 before delivery to ensure staff is available to receive the 
delivery.
     Fax: (202) 493-2251.
    Instructions: You must include the agency name and docket number 
DOT-OST-2022-0109 or the Regulation Identifier Number (RIN) 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 can 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,

[[Page 63719]]

business, labor union, etc.). For information on DOT's compliance with 
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: Ryan Patanaphan, Senior Trial Attorney 
or Blane A. Workie, Assistant General Counsel, 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), 
[email protected] or [email protected] (email).

SUPPLEMENTARY INFORMATION:

A. Background

    In 2014, the Department issued a notice of proposed rulemaking 
(NPRM) titled ``Transparency of Airline Ancillary Service Fees and 
Other Consumer Protection Issues.'' 79 FR 29970 (May 23, 2014). In the 
2014 NPRM, the Department proposed to enhance consumer protections 
through various means, including the disclosure of certain airline 
ancillary service fees. In 2017, noting the significant comments 
received regarding the proposal on ancillary service fees in the 2014 
NPRM, the Department issued a supplemental notice of proposed 
rulemaking (SNPRM) titled ``Transparency of Airline Ancillary Service 
Fees.'' 82 FR 7536 (Jan. 19, 2017).
    In the 2017 SNPRM, the Department proposed to require fees for a 
first and second checked bag and a carry-on bag be disclosed at all 
points of sale wherever fare and schedule information is provided to 
consumers. The Department further proposed that carriers \1\ distribute 
useable, current, and accurate fee information to ticket agents that 
receive and distribute the carrier's fare and schedule information, 
including Global Distribution Systems (GDS). The Department also 
proposed that the information provided by carriers be detailed enough 
to allow ticket agents to disclose fees as itinerary-specific or 
customer-specific (i.e., fees that are differentiated based on factors 
specific to the passenger or proposed itinerary) charges. However, the 
SNPRM did not propose to require that consumers be able to purchase 
these ancillary services through ticket agents (i.e., did not propose 
transactability).
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    \1\ The Department uses the term ``carrier'' or ``airline'' to 
refer to air carriers and foreign air carriers, as such terms are 
defined in 49 U.S.C. 40102(a)(2) and (a)(21).
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    The Department withdrew the SNPRM on December 14, 2017. In the 
notice of withdrawal of proposed rulemaking, 82 FR 58778 (Dec. 14, 
2017), the Department stated that its existing requirements provide 
consumers information regarding fees for ancillary services and noted 
that the withdrawal was consistent with Executive Order (E.O.) 13771, 
``Reducing Regulation and Controlling Regulatory Costs,'' which has 
since been revoked.\2\
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    \2\ President Biden issued E.O. 13992, ``Revocation of Certain 
Executive Orders Concerning Federal Regulation,'' on January 20, 
2021, which revoked E.O. 13771 and certain other Executive orders.
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    On July 9, 2021, the President issued E.O. 14036, ``Promoting 
Competition in the American Economy,'' which launched a whole-of-
government approach to strengthen competition. E.O. 14036 includes 72 
initiatives by more than a dozen Federal agencies to promptly tackle 
some of the most pressing competition problems across our economy. It 
directed the Department to take various actions to foster competition 
and promote the interests of American workers, businesses, and 
consumers. Specifically, section 5, paragraph(m)(i)(F) of E.O. 14036 
states that ``[t]he Secretary of Transportation shall: . . . not later 
than 90 days after the date of this order, consider initiating a 
rulemaking to ensure that consumers have ancillary fee information, 
including ``baggage fees,'' ``change fees,'' and ``cancellation fees,'' 
at the time of ticket purchase.'' This rulemaking implements section 5, 
paragraph(m)(i)(F) of E.O. 14036.\3\
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    \3\ This rulemaking also addresses section 5, paragraph 
(m)(i)(B) of E.O.14036. That section directed the Department to 
promote enhanced transparency and consumer safeguards, as 
appropriate and consistent with applicable law, including through 
potential rulemaking, enforcement actions, or guidance documents, 
with the aims of enhancing consumer access to airline flight 
information so that consumers can more easily find a broader set of 
available flights, including by new or lesser known airlines; and 
ensuring that consumers are not exposed or subject to advertising, 
marketing, pricing, and charging of ancillary fees that may 
constitute an unfair or deceptive practice or an unfair method of 
competition.
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B. Need for a Rulemaking

    The Department regularly receives input from stakeholder groups, 
including airlines and consumer advocacy groups, regarding air 
transportation-related concerns. Consumer advocates have consistently 
stated to the Department that there is a market failure in air 
transportation pricing because consumers are unable to determine the 
true cost of air travel prior to ticket purchase. They have also raised 
concerns about the lack of competition in the industry. The 
Department's full fare rule in 14 CFR 399.84 is designed to ensure the 
price stated is the entire price required to be paid by the consumer 
for air transportation. In the context of the full fare rule, air 
transportation is the transport of the passenger on an aircraft from 
one location to another location and includes all charges the passenger 
must pay for this service. The existing regulation does not require 
that the full fare quoted include the many kinds of ancillary fees 
consumers may pay for optional services. Consumer advocates have 
asserted that a lack of passenger specific information regarding fees 
for ancillary services at the time of ticket purchase is causing a 
market failure by limiting the ability of consumers to understand the 
true cost of the travel that they are looking to purchase and to 
compare pricing between carriers and travel options. Many services or 
products traditionally included in the price of an airline ticket such 
as checked baggage and meals are now sold separately. Ancillary service 
means any optional service related to air travel provided by a carrier, 
for a fee, beyond passenger air transportation. Such service includes, 
but is not limited to, checked or carry-on baggage, ticket change and 
cancellation, advance seat selection, access to in-flight entertainment 
program, and in-flight beverages, snacks, or meals.
    Certain members of Congress and State governments representing 
constituents have expressed support for full, more specific, disclosure 
of ancillary service fees. Certain members of Congress have also 
sponsored legislation on this topic.\4\ Further, the

[[Page 63720]]

Joint Explanatory Statement of the 2018 Consolidated Appropriations Act 
requested that the Department work in collaboration with industry, 
consumers and other stakeholders to establish guidelines on 
transparency of airline ancillary fees.\5\ Subsequently, the Department 
tasked the Aviation Consumer Protection Advisory Committee (ACPAC) with 
examining this issue.\6\ The ACPAC heard from several consumer advocacy 
groups, including Travelers United, the National Consumers League, and 
the Global Business Travel Association regarding this issue. Consumer 
organizations that presented to the ACPAC stressed the importance of 
ensuring consumers can accurately and easily compare travel costs, 
inclusive of ancillary fees, and they recommended that ancillary fee 
information should be clearly displayed early in consumer purchase 
decisions.\7\ The 2020 ACPAC recommended that the Department should 
remain vigilant to ensure compliance with the transparency requirements 
that currently exist.\8\ Prior DOT advisory committees have also 
addressed the issue of ancillary service fee transparency. In 2010, the 
Future of Aviation Advisory Committee advised generally that DOT 
``should ensure transparency in air carrier pricing, including 
ancillary fees.'' \9\ In 2012, the Advisory Committee on Aviation 
Consumer Protection adopted this recommendation and added that all 
participants in the airfare and fee distribution system should be 
guided by principles of transparency, providing choices and offers that 
meet consumer needs, and knowing the full price before purchase.\10\ 
Then in 2015, the Advisory Committee on Aviation Consumer Protection 
recommended that DOT require change/cancellation fees be clear and 
displayed before ticket purchase.\11\ Consumer advocates had asserted 
that such fees had become significant and difficult to ascertain.\12\
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    \4\ See, e.g., Letter from Representative Nita M. Lowey to 
Secretary Elaine Chao (Dec. 8, 2017) and Letter from Pennsylvania 
Attorney General Josh Shapiro and attorneys general from 15 other 
states and the District of Columbia to Secretary Elaine L. Chao 
(Dec. 20, 2017). See also section 203 of S. 3222, Airline 
Passengers' Bill of Rights (introduced by Senators Blumenthal, 
Markey, Whitehouse, Wyden, and Casey on November 17, 2021) at 
https://www.congress.gov/bill/117th-congress/senate-bill/3222/text?r=7&s=1, proposing to mandate that DOT require airlines, online 
travel agencies (OTAs), metasearch engines and other ticket agents 
that provide flight search tools disclose all applicable taxes and 
ancillary fees at any point in which the fare is shown and in 
telephone communication with a prospective consumer in the U.S. at 
any point in which the cost of the air transportation is disclosed. 
See also The Unfriendly Skies: Consumer Confusion Over Airline Fees, 
Staff Report of Minority Staff of Senate Commerce Committee (August 
6, 2015) at https://www.blumenthal.senate.gov/imo/media/doc/8%206%2015%20FINAL%20Airline%20Report.pdf, finding that ancillary 
fees, such as change and cancellation penalties, are increasingly 
less transparent regarding the true cost of air travel and 
recommending more transparency from the airline industry.
    \5\ https://www.congress.gov/congressional-record/2018/03/22/house-section/article/H2697-1 at page H2872.
    \6\ See https://www.regulations.gov/document/DOT-OST-2018-0190-
0001.
    \7\ See Summary of April 4, 2019 ACPAC Meeting 10-16, available 
at https://www.regulations.gov/document/DOT-OST-2018-0190-0019; see 
also Summary of September 24, 2020 ACPAC Meeting 19-20, available at 
https://www.regulations.gov/document/DOT-OST-2018-0190-0025.
    \8\ Report of the Aviation Consumer Protection Advisory 
Committee 5 (Dec. 31, 2020), available at https://www.transportation.gov/individuals/aviation-consumer-protection/acpac-report-secretary-transportation-december-31-2020.
    \9\ The Future of Aviation Advisory Committee, Final Report 36 
(Apr. 11, 2011), available at https://www.transportation.gov/highlights/future-aviation-advisory-committee/faac-final-report.
    \10\ Report of the Advisory Committee on Aviation Consumer 
Protection 7-8 (Oct. 22, 2012), available at https://www.transportation.gov/airconsumer/ACACP/1st-ACACP-Report-22OCT2012.
    \11\ Record of Meeting, Ninth Meeting of the Advisory Committee 
on Aviation Consumer Protection 3 (Sept. 1, 2015), available at 
https://www.transportation.gov/airconsumer/ACACP/9th-meeting-Sept-1/record.
    \12\ See Record of Meeting, Eighth Meeting of the Advisory 
Committee on Aviation Consumer Protection 3-5 (June 23, 2015), 
available at https://www.transportation.gov/sites/dot.gov/files/docs/resources/individuals/aviation-consumer-protection/285976/acacp-record-8th-meeting-23june2015.pdf; see also Record of Meeting, 
Ninth Meeting of the Advisory Committee on Aviation Consumer 
Protection (Sept. 1, 2015).
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    Most recently, in June 2022, the ACPAC again addressed the issue of 
transparency of airline ancillary service fees.\13\ During the meeting, 
DOT solicited comment on the key topics of this NPRM (namely, which 
ancillary service fees are critical for consumers, airlines sharing 
data regarding critical ancillary service fees with ticket agents, and 
how to best display this information to consumers). DOT also solicited 
comment on whether fees for certain ancillary services should be 
disclosed at the first point in a search process where a fare is 
listed.
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    \13\ See https://www.transportation.gov/airconsumer/ACPAC/June2022Meeting. A webcast of the meeting is available to view on 
the ACPAC website. Speakers' materials have been posted to the ACPAC 
docket at www.regulations.gov; docket DOT-OST-2018-0190. On the 
second day of the meeting, the ACPAC addressed the separate but 
related issue of availability of airline flight information.
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    Consumer advocates expressed the view that because most passengers 
travel once per year or less, they may not be aware of certain 
ancillary service fees, such as those related to seat selection.\14\ 
Advocates also argued that the practice of ``drip pricing,'' in which 
sellers advertise a portion of the full price and then reveal 
additional charges over time tends to lock consumers into engaging with 
a given seller, and reduces competition, because the customer has 
invested time and energy into the purchasing process and thus is less 
likely to abandon the purchase entirely and re-institute a fuller 
search for options.\15\
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    \14\ Presentation of FlyersRights, available at https://www.regulations.gov/document/DOT-OST-2018-0190-0046.
    \15\ Id.; see also Presentation of American Antitrust Institute, 
available at https://www.transportation.gov/airconsumer/ACPAC/June2022Meeting/webcast (Day 1 morning session), and Federal Trade 
Commission, ECONOMIC ANALYSIS OF HOTEL RESORT FEES, (Jan. 2017), 
available at https://www.ftc.gov/system/files/documents/reports/economic-analysis-hotel-resort-fees/p115503_hotel_resort_fees_economic_issues_paper.pdf.
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    This NPRM builds on the Department's final rule in 2011 regarding 
the disclosure of ancillary service fees by carriers and ticket agents. 
76 FR 23110 (April 25, 2011). The 2011 final rule requires carriers to 
list on their website all ancillary service fees on a page that is 
directly linked from their main websites. The Department allows 
carriers to display the fees for ancillary services in a range, except 
for baggage information. For baggage, the Department requires that 
carriers provide specific baggage fee information to enable the 
consumer to determine the cost of the baggage. In addition, carriers 
and ticket agents are required to disclose, upon displaying the result 
of an itinerary search, that baggage fees may apply and refer the 
consumer to the location on the airlines' or ticket agents' website 
where the consumer can review baggage fee information to determine the 
fees that would apply to him or her. While the Department considers the 
disclosure requirements in its 2011 final rule to be a step in the 
right direction, based on feedback from consumer advocacy groups and 
others since publication of the 2011 final rule, DOT has determined 
that these requirements were insufficient and did not fully provide 
transparency of ancillary services and products.
    Since the issuance of the 2011 final rule, consumer advocacy 
organizations have regularly reported to the Department that consumers 
often find the process of determining the baggage fees that apply to 
them to be a complicated and time-consuming process. In 2019, during a 
meeting of the Aviation Consumer Protection Advisory Committee, two 
consumer organizations underscored the difficulties faced by consumers 
in determining the total cost of air travel.\16\ Consumer advocates 
maintain that consumers are confused by the complex charts that 
carriers and ticket agents provide to consumers to determine their 
baggage fees. In September 2017, the Government Accountability Office 
(GAO) noted that consumer group representatives stated that it has 
become ``increasingly difficult for consumers to compare airfare ticket 
prices, fees, and associated rules, and understand what is included in 
their purchases.'' \17\ In December 2017, after the Department withdrew 
its January 2017 SNPRM on transparency of airline ancillary fees, a 
coalition of 16

[[Page 63721]]

States' attorney generals urged the Department to reverse its decision, 
stating that they ``regularly hear reports from consumers in [their] 
states who are confused and frustrated by these fees, which 
significantly alter the total cost of travel.'' \18\ The Department 
also receives consumer complaints that reflect the confusion consumers 
experience regarding fees for baggage. Further, consumer advocates 
contend that the ancillary services and fees that airlines post on 
their websites are not useful to consumers to determine the cost of 
travel because airlines generally provide a range of fees for ancillary 
services aside from baggage. Airlines acknowledge that the fees for 
ancillary services often vary based on various factors such as the type 
of aircraft used, the flight on which a passenger is booked, or the 
time at which a passenger pays for the service or product. The 
requirements to provide specific baggage fee information and a range of 
fees for other ancillary services have not been as helpful to consumers 
in determining the true cost of travel as the Department had 
anticipated when issuing its final rule in 2011.
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    \16\ See Summary of April 4, 2019 ACPAC Meeting 11-13, available 
at https://www.regulations.gov/document/DOT-OST-2018-0190-0019.
    \17\ GAO 17-756, Commercial Aviation: Information on Airline 
Fees for Optional Services (September 2017), p. 33 at https://www.gao.gov/assets/gao-17-756.pdf.
    \18\ Letter from Pennsylvania Attorney General Josh Shapiro and 
attorneys general from 15 other states and the District of Columbia 
to Secretary Elaine L. Chao (Dec. 20, 2017).
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    The Department receives hundreds of consumer complaints each year 
regarding change fees, cancellation fees,\19\ and seating fees.\20\ The 
complaints regarding seating fees have included complaints from 
consumers who state that they were not provided seats next to their 
young child on a flight. Congress instructed the Department to review 
airline seating policies and consider establishing a policy directing 
airlines to have policies to enable children who are 13 years of age or 
younger to sit with a family member over the age of 13 at no additional 
cost.\21\ In July 2022, the Department issued a ``Notice Encouraging 
U.S. Airlines to Have Policies That Enable Children to Be Seated 
Adjacent to an Accompanying Adult to the Maximum Extent Practicable and 
at No Additional Cost.'' \22\ In the notice, the Department provides 
that airlines should do everything that they can to ensure the ability 
of parents to sit next to their young children, including allowing 
every young child to sit next to a parent without charging fees for 
adjacent seating. It is also worth noting that consumer comments in the 
2014 NPRM strongly supported Department action on disclosure of 
ancillary service fees.\23\
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    \19\ The Department's Office of Aviation Consumer Protection 
(OACP) received over 550 complaints regarding change and 
cancellation fees in 2021. The Department has not determined what 
share of these complaints are from individuals who were unaware of 
the fees or unable to find information on the fees and what share 
was from individuals who generally did not like having to pay a fee.
    \20\ OACP received over 140 complaints regarding seat fees in 
2021. The Department has not determined what share of these 
complaints are from individuals who were unaware of the fees or 
unable to find information on the fees and what share was from 
individuals who generally did not like having to pay a fee.
    \21\ See 49 U.S.C. 42301 note prec. (Section 2309 of the FAA 
Extension, Safety, and Security Act of 2016, Public Law 114-190 
(July 15, 2016)).
    \22\ See https://www.transportation.gov/individuals/aviation-consumer-protection/family-seating/June-2022-notice.
    \23\ See comments submitted in the 79 FR 29970 (May 23, 2014). 
The docket for the 2014 NPRM, which can be accessed at https://www.regulations.gov/search?filter=DOT-OST-2014-0056. See also 82 FR 
7536, 7537 (Jan. 19, 2017) describing comments received in 2014 NPRM 
as ``Over 450 consumers clearly supported additional requirements 
relating to disclosure of ancillary service fees while fewer than 
ten commented in opposition to additional disclosure requirements.''
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    Based on a review of consumer complaints, comments received in the 
2014 NPRM, feedback received from consumer advocacy organizations, and 
the work of various advisory committees, the Department believes that 
many consumers continue to be unsatisfied with the level of disclosures 
they receive regarding ancillary service fees. The Department believes, 
based on a review of consumer complaints and discussions at past 
advisory committee meetings, that the current disclosure requirements 
are not sufficient. It is difficult for consumers to determine the best 
and most cost-effective flights when fee information for essential 
services such as ticket changes or cancellations, family seating, or 
baggage is not readily available. There is a need for a rulemaking on 
transparency of airline ancillary fees to address difficulties that 
consumers have in finding ancillary service fee information, which 
limits consumers' ability to determine the true cost of travel and to 
adequately compare airline pricing. In issuing this rulemaking, the 
Department intends to protect consumers from hidden and deceptive fees 
and enable them to determine the true cost of travel in an effective 
and efficient manner when they price shop for air transportation.

C. Statutory Authority

    The Department is issuing this rulemaking pursuant to its statutory 
authority in 49 U.S.C. 41712 to prohibit unfair and deceptive practices 
in air transportation and the sale of air transportation. 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.\24\ 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. A matter is material if it is likely to have affected the 
consumer's conduct or decision with respect to a product or 
service.\25\ Proof of intent is not necessary to establish unfairness 
or deception.\26\ The elements of unfair and deceptive is further 
elaborated by the Department is its guidance document.\27\
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    \24\ 14 CFR 399.79(b)(1).
    \25\ 14 CFR 399.79(b)(2).
    \26\ 14 CFR 399.79(c).
    \27\ 87 FR 52677 (August 28, 2022).
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    Pursuant to its authority under section 41712, the Department 
proposes to require that airlines and ticket agents disclose bag fees 
for a first and second checked bag and a carry-on bag, family seating 
fees for a young child traveling with an adult, as well as change and 
cancellation fees and policies whenever fare and schedule information 
is provided to a consumer in response to a passenger-specific or 
anonymous itinerary search on a website marketed to U.S. consumers 
where air transportation is advertised or sold. This includes, but is 
not limited to, the first place a fare is stated in search results. The 
Department's tentative basis for concluding that the practices this 
NPRM would prohibit are unfair and deceptive is articulated in the 
paragraphs that follow.

Bag Fees

    The Department tentatively considers not displaying bag fees, which 
have historically been included in the airfare (i.e., fee for first and 
second checked bag and carry-on bag) but are now often broken out from 
the airfare, in a passenger-specific manner whenever fare and schedule 
information is provided to be an unfair practice because 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.
    The substantial injury this practice is likely to cause is the 
additional time spent searching to find the total cost of travel and 
any additional funds spent on air transportation that might have been 
avoided if the consumer had been able to determine the true cost of 
travel up front and readily select the best price. This harm is not 
reasonably avoidable even with the disclosures mandated in the 2011 
final rule that improved consumer access to first and second checked 
bag and carry-on bag fee

[[Page 63722]]

information by requiring those fees to be displayed on airlines' and 
ticket agents' websites. Airlines and ticket agents continue to 
disclose bag fees in a static format in complex charts that are 
confusing to consumers and that are not readily available at the moment 
consumers need the information to comparison shop. Further, in 
connection with complex itineraries, interline tickets, and even some 
code-share flights, consumers are still reporting confusion regarding 
the total cost of baggage fees. The harm that consumers experience is 
not outweighed by benefits to consumers or competition because consumer 
confusion about applicable bag fees harms, rather than benefits, 
competition. The Department believes that the disclosure of passenger-
specific fees whenever fare and schedule information is provided would 
promote informed buyers, enhance competition, and lower prices.
    The practice of not displaying passenger-specific fees for first 
and second checked bags and carry-on bags when fare and schedule 
information is provided is also deceptive in that it misleads consumers 
into believing the total purchase price from one carrier or ticket 
agent is cheaper than that of another when that may not be the case. 
This belief is reasonable as carriers and agents often display only the 
air fare and not these bag fees during an itinerary search. As carriers 
have different policies regarding the fees and limitations imposed to 
transport baggage, and because variation within each carrier depends on 
the fare category purchased or the status of the passenger, the current 
requirement that carriers and ticket agents provide a generic notice 
that ``fees for baggage may apply'' during the booking process is not 
providing consumers sufficient notice of the total cost of the air 
transportation. In addition, although carriers and ticket agents are 
required to inform consumers during the booking process about where 
consumers can see baggage fees, consumers are often diverted to complex 
charts that are confusing, prolong the consumer's process of evaluating 
itineraries and fares for purchase, and may ultimately not be 
instructive for many consumers in determining the bag fee that would 
apply to them. The cost of the first and second checked bag and carry-
on bag is often material to consumers, as knowing such costs in 
conjunction with the ticket price is likely to affect the consumer's 
purchase decisions. According to the GAO, since airlines first imposed 
checked baggage fees, the number of checked bags per passenger has 
declined. GAO also explains that checked baggage fees have led to 
greater amounts of carry-on baggage.\28\
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    \28\ GAO 10-785, Commercial Aviation: Consumers Could Benefit 
from Better Information about Airline-Imposed Fees and Refundability 
of Government-Imposed Taxes and Fees (July 14, 2010) at https://www.gao.gov/assets/gao-10-785.pdf.
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Change and Cancellation Fees and Policies

    The Department tentatively considers the practice of not clearly 
disclosing passenger-specific change and cancellation fees and policies 
during the ticket purchase process to be an unfair practice because 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.
    The Department currently requires the disclosure of these fees on 
or with the ticket.\29\ However, this requirement means that consumers 
often receive information about these fees after the purchase of the 
ticket is already made (i.e., upon receipt of the ticket confirmation), 
which is not sufficient disclosure. The practice of not disclosing 
these fees early in the process and prior to ticket purchases causes 
substantial injury to consumers in that passengers may purchase tickets 
without adequate notice that they could incur significant fees to 
change or cancel their tickets, that they are not entitled to a refund 
in the original form of payment if they do cancel, or that there are 
other restrictions on their ability to change or cancel their tickets. 
These harms are not reasonably avoidable if the carrier or ticket agent 
does not provide disclosures on their cancellation or change policies 
during booking. Carriers may have separate web pages that contain such 
policy and fee information, but this information may be in a range, so 
consumers may not know the specific change or cancellation fee that 
would apply to them. Moreover, even if not in a range, change and 
cancellation policies and fees may not be simple to understand, as fare 
categories, passenger status, ticket type (e.g., award ticket 
purchases), and other factors may impact the applicable change and 
cancellation fees and policies. Further, because the cancellation and 
change fee information is not provided during the booking process, 
consumers would need to interrupt their booking process to search for 
the information and extend the time needed to complete a booking. The 
harm that consumers experience is not outweighed by benefits to 
consumers or competition because, like baggage fees, consumer surprise 
or confusion about applicable change and cancellation fees after 
airfare purchase harms, rather than benefits, competition. The 
Department believes that the disclosure of passenger-specific or non-
passenger-specific change and cancellation fees whenever fare and 
schedule information is provided would promote informed buyers, enhance 
competition, and lower prices.
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    \29\ See 14 CFR 253.7.
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    The Department also tentatively considers the practice of not 
displaying change and cancellation fees when fare and schedule 
information is provided to be deceptive. Without proper notice, 
consumers acting reasonably would be misled with respect to the change 
and cancellation policies that apply to their ticket and may believe 
that change or cancellations are possible at no fee or at a reduced 
fee. The Department has received complaints from consumers expressing 
surprise at the high level of the fees that have been imposed, in some 
cases, cancellation or change fees are higher than the fare paid by the 
consumer. Comments in a prior DOT rulemaking on ancillary fees also 
support the importance of disclosure of change and cancellation fees to 
consumers.\30\ The change and cancellation fees are therefore material 
because they could affect the consumer's decision on whether to 
purchase an airline ticket and if so, which airline to select. As such, 
the Department is of the tentative view that not displaying change and 
cancellation fees when fare and schedule information is provided is 
deceptive.
---------------------------------------------------------------------------

    \30\ See comments submitted in the docket for the 2014 NPRM, 
which can be accessed at https://www.regulations.gov/search?filter=DOT-OST-2014-0056.
---------------------------------------------------------------------------

Family Seating Policies and Fees

    For similar reasons, the Department tentatively considers the lack 
of fee disclosure for adjacent seating when fare and schedule 
information is provided and restrictions on purchasing those seats at 
all point of sale to be an unfair practice for those traveling with a 
young child. This lack of disclosure and transactability of family 
seating information 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.
    The practice causes substantial harm to consumers in that 
passengers may face situations in which they are unexpectedly separated 
from their children on flights or must pay

[[Page 63723]]

unexpected fees to remain with their children. Also, despite 
information about carrier family seating policies being available on 
airlines' websites, the harm is not reasonably avoidable because a 
reasonable consumer would not believe that it is necessary to pay fees 
to be seated next to his or her young child and would not know to 
search for this information on an airline's website before purchasing 
the ticket. Even if the family seating fee is disclosed when fare and 
schedule information is provided that alone would not be sufficient. 
Transactability is necessary because consumers are not able to save the 
seat or lock in the price for adjacent seating at the time of ticket 
purchase.
    The number of family seating complaints that the Department 
receives against airlines is low \31\ but these consumers note being 
confused about the seating policies and fees that apply to them and the 
harm that they face is significant. A substantial harm may be 
demonstrated by a large amount of harm to a small number of people.\32\ 
The likelihood of consumers being unexpectedly separated from their 
children on flight may increase when consumers purchase their tickets 
from a ticket agent without realizing that the fare category (e.g., 
basic economy) or the method of booking (e.g., the ticket agent 
arranged for separate bookings for each family member) selected did not 
adequately enable them to ensure adjacent seats. The need to consult a 
separate web page during the booking process also presents the 
potential for increased confusion and a prolonging of the ticket 
purchase process. The Department looks at this element from the 
perspective of an ordinary consumer acting reasonably under the 
totality of the circumstances. Further, DOT concludes that the harm is 
not outweighed by benefits to consumers or competition. The Department 
believes that the disclosure of the family seating fees when fare and 
schedule information is provided and the ability to purchase those 
seats at all points of sale would promote informed buyers, enhance 
competition, and lower prices.
---------------------------------------------------------------------------

    \31\ In calendar year 2017, .38% of complaints (44 complaints) 
filed with the Department by consumers against U.S. airlines 
concerned family seating. In calendar year 2018, .51% of air travel 
service complaints (46 complaints) against U.S. airlines concerned 
family seating. In calendar year 2019, 2.4% of air travel service 
complaints (230 family seating complaints) against U.S. airlines 
concerned family seating. This increase corresponded with the 
efforts of a consumer advocacy group to encourage air travelers to 
file complaints with the Department if they were dissatisfied with 
an experience related to family seating. Fewer than .5% of the air 
travel service complaints against U.S. airlines filed with the 
Department in calendar years 2020 and 2021 concerned family 
seating--.46% of complaints (165 family seating complaints) in 
calendar year 2020 and .46% of complaints (94 family seating 
complaints) in calendar year 2021.
    \32\ The Federal Trade Commission (FTC) previously noted that 
``it is well established that substantial injury may be demonstrated 
by a showing of a small amount of harm to a large number of people, 
as well as a large amount of harm to a small number of people.'' See 
Opinion of the Commission, In the Matter of LabMD, Inc. (July 19, 
2016) at 9 available at https://www.ftc.gov/system/files/documents/cases/160729labmd-opinion.pdf (``LabMD''). The Department's 
statutory authority to prohibit unfair practices was modeled on 
section 5 of the FTC Act.
---------------------------------------------------------------------------

    The Department also tentatively considers failing to disclose 
potential family seating fees when fare and schedule information is 
provided to be a deceptive practice.\33\ The lack of such fee 
information is likely to mislead consumers into believing that families 
will be able to be seated next to their children free of charge. It 
would also be a deceptive practice to disclose the family seating fees 
but then not allow consumers to purchase those adjacent seats at all 
points of sale. The inability to purchase those seats immediately could 
mislead consumers as prices for seats are often dynamic and change 
based on availability and time of purchase. As evidenced by the 
consumer complaints the Department has received on this issue, the 
Department concludes that consumers have a reasonable belief that young 
children will be allocated a seat near a parent or guardian traveling 
with the child, and that the cost of ensuring adjacent seats with a 
child is material to consumers.
---------------------------------------------------------------------------

    \33\ ``Some cases involve omission of material information, the 
disclosure of which is necessary to prevent the claim, practice, or 
sale from being misleading.'' See FTC 1983 Policy Statement on 
Deception, available at https://www.ftc.gov/system/files/documents/public_statements/410531/831014deceptionstmt.pdf.
---------------------------------------------------------------------------

49 U.S.C. 40101(a)(4)

    In carrying out aviation economic programs, including issuing this 
rulemaking under 49 U.S.C. 41712, the Department considers the factors 
identified in 49 U.S.C. 40101 as being in the public interest and 
consistent with public convenience and necessity. 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. 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. This rulemaking proposes to improve the 
transparency of airline pricing through the increased disclosure of bag 
fees, change and cancellation fees, and family seating policies during 
the ticket purchase process. As carriers vary on their policies for 
such fees and such information is often not provided during the 
purchase process, consumers of air transportation may have difficulty 
comparing the actual and potential costs of accessing the air 
transportation between different carriers. By improving this 
transparency, this rulemaking would allow for better comparisons of 
airline ticket pricing, of which these fees are often a critical 
component, thereby encouraging price competition.

D. Unfair or Deceptive Practice Request for a Hearing

    For the reasons discussed in the Statutory Authority section, the 
Department has tentatively concluded that the practice of not 
displaying applicable fees for first and second checked bags and carry-
on bags during the ticket purchase process is both unfair and 
deceptive. For the reasons discussed in the Statutory Authority 
section, the Department has also tentatively concluded that the lack of 
disclosure regarding ticket change and cancellation fees and policies 
and family seating information during the ticket purchase process 
presents an unfair and deceptive practice.
    Pursuant to the Department's regulation at 14 CFR 399.75(b)(1), any 
interested party may file a petition to hold a hearing on the proposed 
rule prior to the close of the comment period. As stated in the DATES 
section, petitions must therefore be received by December 19, 2022.
    The Department's regulations 14 CFR 399.75(b)(2) provide that the 
Department will grant a petition if the petitioner makes a clear and 
convincing showing that granting the petition is in the public 
interest. Factors considered in determining whether a petition is in 
the public interest include: (1) Whether the proposed rule depends on 
conclusions concerning one or more specific scientific, technical, 
economic, or other factual issues that are genuinely in dispute or that 
may not satisfy the requirements of the Information Quality Act; (2) 
whether the ordinary public comment process is unlikely to provide an 
adequate examination of the issues to permit a fully informed judgment; 
(3) whether the resolution of the disputed factual issues would likely 
have a material effect on the costs and benefits of the proposed rule; 
(4) whether the requested hearing would advance the

[[Page 63724]]

consideration of the proposed rule and the General Counsel's ability to 
make the rulemaking determinations required by Sec.  399.75; and (5) 
whether the hearing would unreasonably delay completion of the 
rulemaking. DOT must also provide an explanation of the basis for the 
decision on a petition. (14 CFR 399.75(b)(3))
Summary of the Proposed Regulatory Provisions
    The Department is proposing to increase the protections provided to 
consumers as provided in the summary table below.

------------------------------------------------------------------------
           Subject                              Proposal
------------------------------------------------------------------------
Covered entities.............  The NPRM applies to: (1) U.S. air
                                carriers; (2) foreign air carriers; (3)
                                ticket agents that sell airline tickets,
                                whether traditional brick-and-mortar
                                travel agencies, corporate travel
                                agents, or online travel agencies; and
                                (4) metasearch sites that do not sell
                                airline tickets but display airline
                                flight search options directly to
                                consumers.
Airline Ancillary Service      The ancillary services that the
 Fees Critical to Consumer      Department has identified as being
 Decision.                      critical to consumers when they choose
                                among air transportation options are as
                                follows: first and second checked bag,
                                one carry-on bag, changing or canceling
                                a reservation, and adjacent seating when
                                traveling with a young child.
Disclosure of Baggage Fees...  The Department is proposing to require
                                carriers and ticket agents to disclose
                                fees for a first and second checked bag
                                and a carry-on bag during the booking
                                process when fare and schedule
                                information is provided (typically first
                                page of search results).
Disclosure of Change and       The Department is proposing to require
 Cancellation Fees and          carriers and ticket agents to disclose
 Policies.                      change and cancellation fees and
                                policies to consumers during the booking
                                process when fare and schedule
                                information is provided (typically first
                                page of search results).
Disclosure of Family Seating   The Department is proposing to require
 Fees and Policies.             carriers and ticket agents to disclose
                                the seat fees applicable for passengers
                                13 or under to be seated next to an
                                accompanying adult in the same class of
                                service during the booking process when
                                fare and schedule information is
                                provided (typically first page of search
                                results).
Timing of Online Disclosures.  The Department proposes to require that
                                first and second checked bag fee, the
                                carry-on bag fee, the change and
                                cancellation fee and the family seating
                                fee be disclosed at the first point in a
                                search process where a fare is listed in
                                connection with a specific flight
                                itinerary.
Passenger-specific             The Department is proposing that the fee
 information.                   information disclosed to a consumer for
                                critical ancillary services be expressed
                                as passenger-specific information if a
                                consumer conducts a passenger-specific
                                itinerary search.
                                A passenger-specific itinerary
                                search refers to a search that takes
                                into account a characteristic of the
                                passenger that may impact ancillary
                                service fees to be charged (e.g.,
                                military status, frequent flyer status,
                                method of payment, etc.)
                                An anonymous itinerary search
                                refers to a search that does not take
                                into account passenger characteristics
                                that may have an impact on ancillary
                                service fees to be charged.
Web site and Mobile Displays.  The Department is proposing to require
                                that the fees for ancillary services
                                that are critical to a consumer's
                                purchasing decision be disclosed to
                                consumers using airlines' or ticket
                                agent's websites and mobile web sites.
In-Person or Telephone         The Department is proposing to require
 Disclosures of Airline         that specific fee information for a
 Ancillary Service Fees.        first and second check bag, one carry-on
                                item, the canceling or changing of a
                                reservation, and a passenger 13 or under
                                to obtain a seat next to an accompanying
                                adult be provided for each itinerary for
                                which a fare is quoted to a consumer
                                during an in-person or telephone
                                inquiry.
Sharing of Airline Ancillary   Airlines would be required to distribute
 Service Fee Information with   fee information for critical ancillary
 Ticket Agents.                 services to ticket agents that sell or
                                display the airlines' fare and schedule
                                information.
                               The proposal specifies that the
                                information provided to agents be
                                usable, accurate and accessible in real-
                                time.
Prohibition on Fee if          Collecting a fee from consumers for
 Required Disclosure is Not     critical ancillary services without
 Provided.                      disclosure of this fee during the search
                                process would be deemed an unfair and
                                deceptive practice.
Transactability..............  The Department is proposing that carriers
                                and ticket agents enable family seating
                                fees to be transactable at all points of
                                sale.
Compliance/Implementation      Six-month implementation period to
 Period.                        display a first and second checked bag
                                fee, a carry-on bag fee, change and
                                cancellation fee, and family seating fee
                                (if any), to consumers whenever fare and
                                schedule information is provided.
------------------------------------------------------------------------

Notice of Proposed Rulemaking
Covered Entities
    In this NPRM, the Department proposes to require entities that 
advertise or sell air transportation to consumers in the United States 
to disclose, prior to ticket purchase, the fees for ancillary services 
that are critical to a consumer's purchasing decision. This means that 
the proposed requirement would apply to U.S. air carriers; foreign air 
carriers; ticket agents that sell airline tickets, whether traditional 
brick-and-mortar travel agencies, corporate travel agents, or online 
travel agencies (OTA); and metasearch sites that display airline flight 
search options directly to consumers. However, Global Distribution 
Systems (GDSs) would not be covered by this proposal as GDSs arrange 
for air transportation but do not sell or display a carrier's fare to 
consumers. The Department solicits comment on whether the covered 
entities should be broader or more limited in scope. For example, 
regarding ticket agents who sell air transportation, should the 
proposed requirement to display information about certain critical 
ancillary services exclude corporate travel agents because the display 
content is typically negotiated by the business involved?
    The airlines and ticket agents that are covered by this rulemaking 
do not need to be physically present in the United States. Given the 
expansion of e-commerce, in many cases, airlines and ticket agents can 
advertise and sell airline tickets to U.S. consumers

[[Page 63725]]

without being physically located in the U.S. This NPRM would apply not 
only to airlines or ticket agents that are physically located in the 
U.S., but also to those that have a website marketed to consumers in 
the United States and display schedule, fare, and availability 
information for flights within, to, or from the United States. To 
determine whether a website is marketed to U.S. consumers, a variety of 
factors would be considered--for example, whether the website is in 
English, whether the seller of air transportation displays prices in 
U.S. dollars or has an option on its website that differentiates sites 
or pages designed for the United States. The Department requests 
comment on other factors that may be indicative of the airline or 
ticket agent doing business in the United States.
    Because ticket agents cannot provide ancillary service fee 
information to consumers unless the information is first provided by 
carriers to ticket agents, the NPRM proposes to require air carriers 
and foreign air carriers to provide the fee information for critical 
ancillary services to all ticket agents that sell or display the 
carrier's fare and schedule information. While fare, schedule, and 
availability information are currently provided by the airlines to the 
GDSs, and by GDSs to the agents that display and sell to consumers, 
information about the cost of ancillary services is not typically 
shared. This NPRM would not require airlines to use GDSs to provide 
ancillary fee information to ticket agents that display or sell airline 
tickets to consumers although they would be free to do so if they wish. 
The Department's focus is on ensuring that information about critical 
airline ancillary services reach consumers using the travel agent 
channel, regardless of process used, because a significant portion of 
airline tickets are purchased indirectly through ticket agents. The 
Department seeks comment on whether the Department should require that 
carriers provide fee information about critical ancillary services to 
GDSs. Why or why not?
Airline Ancillary Service Fees Critical to Consumer Decision
    This rulemaking is intended to ensure that fee information about 
ancillary services that are critical to a consumer's decision making is 
disclosed at all points of sale prior to ticket purchase. The 
Department considers the cost of certain ancillary services to be 
important to consumers when they choose among air transportation 
options. Ancillary service means any service related to air travel 
provided by a carrier, for a fee, beyond passenger air transportation 
(i.e., the transport of the passenger on an aircraft from one location 
to another excluding optional services such as baggage, internet, and 
advance seat assignment). Ancillary service fees can include charges 
for things that have traditionally been included in the price of a 
ticket such as first and second checked bags or meals. It can also 
include services that airlines have typically charged separate from the 
airline ticket for many years, such as changing or canceling a 
reservation.
    The ancillary services that the Department has identified as being 
critical to consumers when they choose among air transportation options 
are as follows: first and second checked bag, one carry-on item, 
changing or canceling a reservation, and adjacent seating when 
traveling with a young child. The fees that consumer commenters to the 
Department's 2014 NPRM most commonly identified as being of critical 
importance were baggage, seat assignments and change or cancellation 
fees. These are also the top three most common ancillary service 
complaints received by the Department. With regard to seat assignments, 
although there are fewer complaints about seat assignments for 
passengers traveling with small children, the complaints illustrate the 
critical importance parents and guardians place on ensuring that their 
children are seated next to them. We request comment on whether the 
Department's list of critical ancillary services should be expanded or 
reduced. Are there particular ancillary service fees (or set of fees) 
that have a material impact on the total price paid by the consumer or 
are of particular importance to consumers? What are the benefits and 
potential challenges to expanding or reducing the Department's list of 
critical ancillary services? Comments that are most useful provide 
information regarding the reasons why additional disclosures should or 
should not be required. The Department also seeks comment on how to 
address future adoption by airlines of additional ancillary service 
fees and how to ensure their disclosure to the extent that they are of 
critical importance to consumers.
Types of Proposed Disclosures
1. First and Second Checked Bag and Carry-On Bag
    The Department is proposing to require that carriers and ticket 
agents disclose fees for a first and second checked bag and a carry-on 
bag on the first page displayed when a consumer conducts a search for 
air transportation. This would replace the existing requirement to 
provide a generic notice during the booking process about baggage fees 
and a link to where the baggage fees can be found on the carrier's 
website. The fees would need to be adjusted to accurately reflect the 
itinerary of the passenger, the fare category selected, and the fees 
applicable to the passenger if the consumer has conducted a passenger-
specific itinerary search. In instances where the carrier or ticket 
agent website displays multiple fare categories (e.g., basic economy, 
restricted economy, flexible economy, and business class) for the same 
itinerary, the NPRM would require the carrier and ticket agent to also 
display the bag fees applicable to each fare category. Display of the 
baggage fee by links or rollovers is not permitted but we request 
comment on whether it should be permitted. The proposed rule would also 
clarify that airlines and ticket agents may choose to offer ancillary 
service packages or bundles that include bag fees, alongside the 
standalone bag fees that would be required to be displayed under this 
rulemaking.\34\
---------------------------------------------------------------------------

    \34\ While the Department recognizes that here is the potential 
for confusion when both a standalone fee and a bundled fare are 
displayed if the airline or ticket agent does not do an adequate job 
of designing its website interface, but we would expect that these 
entities would be incentivized to clearly label what is included in 
any packaged bundles, and the separate bag fee information would 
allow consumers to know whether the package bundle is priced 
appropriately to suit their needs (or whether the consumer is better 
off purchasing the bag alone).
---------------------------------------------------------------------------

    The proposal to disclose baggage fees does not apply to air-tour 
packages advertised or sold online by ticket agents if the air 
transportation component is not finalized and the carrier providing air 
transportation is not known at the time of booking. However, ticket 
agents in such situations would need to disclose that additional 
airline fees for baggage may apply and that those fees may be reduced 
or waived based on the passenger's frequent flyer status, method of 
payment or other consumer characteristic. When the identity of the 
carrier providing the air transportation becomes known, the ticket 
agent would need to provide the specific baggage fee information for 
the carrier to not only prospective customers, but also those who 
purchased the air-tour package before the identity of the carrier 
became known. We request comment on whether this exception for certain 
air-tour packages adequately addresses concerns of air-tour package 
sellers. We also request comment on whether such an exception 
adequately protects consumers.

[[Page 63726]]

2. Change and Cancellation Policies and Fees
    This rulemaking proposes making change and cancellation fees and 
policies more apparent to consumers when they book tickets. Under the 
proposal, carriers and ticket agents would have to display the fee to 
change a reservation and the fee to cancel a reservation on the first 
page that appears when a consumer conducts a search for air 
transportation and a fare is quoted. The fee information would need to 
be specific to each fare category displayed and adjusted based on 
passenger-specific information provided by the consumer. For example, 
if the fare category displayed requires a $50 fee to change the ticket, 
then the website should display the change fee for the itinerary and 
fare category as ``$50.'' If the consumer's status entitles the 
consumer to no change fees, then the website should display ``$0'' as 
the applicable change fee for the itinerary, provided that the consumer 
has entered passenger-specific information that meets the criteria for 
no change fees. Display of the cancellation and change fee by links or 
rollovers is not permitted but we request comment on whether it should 
be permitted.
    In addition to the change and cancellation fees, the Department is 
proposing to require that carriers and ticket agents provide 
information about certain aspects of their change and cancellation 
policies to consumers on the first page that appears when a consumer 
conducts a search. This information, which may be provided using links 
or pop-ups adjacent to the pertinent fee, would consist of: (1) a brief 
summary of the cancellation policy applicable to the consumer's chosen 
itinerary and fare category, taking into account the consumer's 
passenger-specific information provided, and (2) a brief summary of the 
ticket change policies applicable to the consumer's chosen itinerary 
and fare category, adjusted for the passenger-specific information 
provided. These brief summaries should provide consumers clear, 
adequate notice of the rules attached to the chosen itinerary and fare 
category, including whether ticket changes or cancellations are allowed 
(as well as when and in what circumstances they are allowed), the form 
that refunds or airline credits may be provided (e.g., travel voucher 
or a credit to the original form of payment), any prohibitions or 
conditions that may limit the ability to change or cancel a ticket, and 
other information. The Department seeks comment on this proposal. 
Should the Department require change fees be disclosed as proposed? If 
so, how should the Department address the potential need for a consumer 
to also pay a fare difference between the old and new tickets brought 
about by dynamic pricing models \35\ many carriers employ? Does the 
material change in fare that occurs with many ticket changes being a 
potentially larger component of the overall price relative to the 
change fee itself represent a more confusing situation for consumers? 
Should the Department only require change fees be disclosed, or should 
it also require cancellation fees to be disclosed as proposed? Should 
the Department allow the proposed disclosures to be provided later in 
the ticket purchase process than proposed in this NPRM? Are there 
preferred methods for presenting the change and cancellation policy 
information?
---------------------------------------------------------------------------

    \35\ A dynamic pricing model implements price differentiation 
for the airline seat and generally increases the price of the 
service as fewer seats are available and decreases the price of the 
service when more seats are available.
---------------------------------------------------------------------------

    This rulemaking also proposes to require that carriers and ticket 
agents with websites marketed to U.S. consumers where they sell air 
transportation display on the last page of the booking process (before 
the consumer clicks a button that executes the purchase or reservation) 
a brief statement on whether the carrier or ticket agent permits the 
consumer's booking to be cancelled without penalty within 24 hours, or 
whether the carrier or ticket agent permits the consumer to hold the 
reservation without payment for 24 hours. Under 14 CFR 259.5(b)(4), 
carriers must currently either permit consumers to cancel their tickets 
within 24 hours of purchase without penalty, or, alternatively, allow 
consumers to hold their reservations at the quoted fare for 24 hours 
without payment, provided that the purchase or reservation is made at 
least one week before the flight's departure. The policy that the 
carrier chooses must be disclosed in its customer service plan pursuant 
to 14 CFR 259.5. The Department is now proposing that the carrier's 
chosen policy also be disclosed on the last page of the booking 
process. Although ticket agents are not required to develop customer 
service plans under 14 CFR 259.5, this rulemaking would also require 
ticket agents to disclose the ticket agent's policy for allowing 
consumers to cancel their reservations without penalty soon after 
purchase or for allowing consumers to hold their reservation without 
purchase for a specified period. If carriers or ticket agents offer 
both alternatives, which they are not required to do so, then this 
information should be disclosed to consumers. The Department seeks 
comment on this additional disclosure.
3. Seat Assignment Policies and Fees for Families Traveling With Young 
Children
    The Department is of the tentative view that disclosure of an 
advance seat assignment fee at the beginning of a booking process is 
generally not needed because airlines are required to provide a seat 
with the cost of the air transportation. However, advance seat 
assignments are of critical importance to families traveling with young 
children. While these families may not need a guarantee of a particular 
seat in advance, they are looking for a guarantee that at least one 
accompanying adult would be seated next to a young child.
    Section 2309 of the FAA Extension, Safety, and Security Act of 2016 
required the Department to review U.S. airline family seating policies 
and, if appropriate, establish a policy directing all air carriers 
providing scheduled passenger interstate or intrastate air 
transportation to establish policies that enable a child, who is age 13 
or under on the date an applicable flight is scheduled to occur, to be 
seated in a seat adjacent to the seat of an accompanying family member 
over the age of 13, to the maximum extent practicable and at no 
additional cost.'' Section 2309 provides for an exception when 
assignment to an adjacent seat would require an upgrade to another 
cabin class or a seat with extra legroom or seat pitch for which 
additional payment is normally required. In response to section 2309, 
the Department's Office of Aviation Consumer Protection issued a notice 
urging airlines to do everything that they can to ensure the ability of 
a parent to sit next to his or her young child, including allowing 
every young child to sit next to a parent, without charging fees for 
adjacent seating.\36\
---------------------------------------------------------------------------

    \36\ See https://www.transportation.gov/individuals/aviation-consumer-protection/family-seating/June-2022-notice.
---------------------------------------------------------------------------

    To the extent airlines do charge fees for a young child to sit next 
to a parent, the Department is proposing to require carriers and ticket 
agents to disclose these fees to consumers alongside the quoted fare 
for each itinerary. More specifically, the NPRM proposes that carriers 
and ticket agents disclose alongside the fare the seat fee, if any, 
that could be imposed for aa child age 13 or under to be seated 
adjacent (i.e., directly next to, and uninhibited by an

[[Page 63727]]

aisle or other obstruction) to an accompanying adult in the same class 
of service, so that consumers are informed on the potential ticket 
costs. If the carrier does not impose a fee for children 13 or under to 
be seated next to an accompanying adult, no seat fee disclosure would 
be required for the carrier's flights. If the carrier does impose fees 
for children to be assigned seats next to an accompanying adult, then 
the carrier or ticket agent's website should disclose the fee to select 
a seat that is part of a pair of available adjacent seats. Display of 
the fee by links or rollovers is not permitted but we request comment 
on whether it should be permitted.
    The proposal to disclose the fee for adjacent seating for those 
traveling with a young child whenever fare and schedule information is 
provided is intended to be performance-based. The Department is not 
prescribing a particular way for the regulated entities to comply but 
notes that there are several acceptable means of compliance. For 
example, to ensure that a consumer receives family seating information 
as part of the itinerary search results and accompanying fare 
quotations, a carrier or ticket agent could decide to enable consumers 
to disclose that a passenger 13 or under will be traveling prior to 
initiating an itinerary search. A carrier or ticket agent could 
alternatively decide to display family seating fees for all itinerary 
searches, regardless of whether a consumer disclosed that a passenger 
was 13 or under. As another alternative, carriers that do not impose a 
fee for children 13 or under to be seated next to an accompanying adult 
would not be obligated to provide any family seating disclosures during 
the itinerary search and selection process.
    As the Department is aware that seat fees can fluctuate frequently, 
the Department is proposing that family seating fees that are quoted 
during the itinerary selection process be transactable at the point of 
ticket purchase, including on ticket agent websites. (See section on 
``Sharing of Airline Ancillary Service Fee Information with Ticket 
Agents'', below.)
    The Department seeks comment on its proposed disclosures to assist 
families traveling with young children. Should the Department permit 
these disclosures to be provided later during the booking process, such 
as after the stage when a consumer inputs passenger name and age 
information? Should the Department be more prescriptive about family 
seat fee disclosure requirements (e.g., requiring that websites be 
modified to enable consumers to indicate whether a passenger will be 13 
or under prior to initiating the search)? Are there technical or other 
practical considerations for requiring that family seating fees be 
disclosed and transactable? Should disclosure be limited to fees or 
would additional information regarding airline family seating policies 
be useful to consumers during the ticket purchase process? What 
disclosure should be required, if any, when no adjacent seats are 
available at the time of the consumer's ticket purchase? The Department 
welcomes responses to these questions.
Online Disclosures of Airline Ancillary Service Fees
1. Timing of Online Disclosures
    During the 2022 ACPAC meeting, DOT solicited information on the 
appropriate timing of disclosure for ancillary service fees (e.g., at 
the time of an initial display of schedule information, or at other 
times during the booking process, or at the end of the process before a 
final purchase). The ACPAC member representing consumers observed that 
in order to minimize problems with drip pricing, consumers should have 
information on critical ancillary service fees early in the process; 
however, he also noted that providing early information on all 
ancillary fees could lead to consumers being overwhelmed.\37\ 
Specifically, he opined that baggage fees, change/cancellation fees, 
and seat reservation fees were the biggest ``pain points'' for 
consumers that should be disclosed early. Similarly, a consumer 
advocacy organization suggested that fees for carry-on and checked 
bags, as well as change/cancellation fees and on-time/cancellation 
statistics, should be displayed on the first page where a price is 
quoted.\38\
---------------------------------------------------------------------------

    \37\ Comment of John Breyault (Day 1 a.m. session).
    \38\ Presentation of FlyersRights, available at https://www.regulations.gov/document/DOT-OST-2018-0190-0046.
---------------------------------------------------------------------------

    This rulemaking proposes that if a U.S. or foreign air carrier or 
ticket agent has a website marketed to U.S. consumers where it 
advertises or sells air transportation, the carrier and ticket agent 
would disclose the first and second checked bag fee, the carry-on bag 
fee, the change and cancellation fee, and the seat fee for a child 13 
or under to be seated next to an accompanying adult, at the first point 
in a search process where a fare is listed in connection with a 
specific flight itinerary. It is important that a consumer be provided 
fee information for critical ancillary services at the same time as the 
fare information is being provided to enable the consumer to make an 
informed purchasing decision. We believe that requiring disclosure 
during the search process benefits consumers because information 
disclosed at the last minute may result in some consumers deciding to 
revisit all the travel arrangements already made and possibly begin the 
reservation process again to look for flights again.
    Regarding disclosure of the fee for a child 13 or under to be 
seated adjacent to an accompanying adult, the Department is proposing 
to require carriers and ticket agents enable consumers to purchase the 
seat fee that is disclosed during the itinerary search at the same time 
as the ticket purchase. Prices for advance seat assignments are often 
dynamic and change based on availability and time of purchase. While 
carriers are prohibited from increasing the change and cancellation 
fee, the first and second checked bag fee, and the carry-on bag fee 
after the ticket has been purchased,\39\ this is not the case for a 
seat assignment fee. Carriers are allowed to increase the price of an 
advance seat assignment until the seat assignment itself is purchased. 
The Department seeks comment on the timing of the proposed online fee 
disclosures in this rulemaking.
---------------------------------------------------------------------------

    \39\ See 14 CFR 253.7, which prohibits carriers from imposing 
monetary penalties on passengers unless the passenger receives 
conspicuous written notice on or with the ticket. See also Guidance 
on Price Increases of Ancillary Services and Products not Purchased 
with the Ticket (December 28, 2011). In that guidance, the 
Department announced that with respect to fees for ancillary 
services that were not purchased with the air transportation, it 
would only enforce the prohibition on post-purchase price increases 
for carry-on bags and first and second checked bags. The application 
of the prohibition of the post-purchase price increase was also at 
issue in a lawsuit filed by two airlines against the Department. The 
court considered the rule as applied under the December 28, 2011, 
guidance and upheld the Department's rule prohibiting post-purchase 
price increases as it is currently being applied. Spirit Airlines, 
Inc., v. U.S. Dept. of Transportation (D.C. Cir. July 24, 2012), 
slip op. at 20-21. Petition for Writ of Certiorari denied on April 
1, 2013.
---------------------------------------------------------------------------

2. Passenger-Specific Information
    The Department is proposing that the fee information disclosed to a 
consumer for critical ancillary services be expressed as passenger-
specific charges if the consumer elects to provide passenger-specific 
information to the carrier or ticket agent, such as frequent flyer 
type, payment method, or military status. For example, a passenger who 
is active in the military may be entitled to an additional piece of 
checked luggage free of charge, or a passenger who has qualified at the 
highest tier of a carrier's frequent flyer program may be entitled to a 
maximum checked luggage weight

[[Page 63728]]

limit of 70 pounds per piece. The carrier or ticket agent would know 
that a consumer is conducting a passenger-specific itinerary search if 
the consumer has entered this passenger-specific information either 
prior to initiating the itinerary search, or if the consumer has logged 
into his or her account on the carrier or ticket agent's website, 
provided that the consumer's user profile contains the passenger-
specific information.
    If the consumer conducting a search elects not to provide 
passenger-specific information to the carrier or ticket agent (i.e., 
the consumer conducts an ``anonymous itinerary search''), then the 
Department is proposing to require carriers and ticket agents to 
disclose the fees for these ancillary services as itinerary-specific 
charges. Itinerary-specific refers to variations in fees that depend 
on, for example, geography, travel dates, cabin (e.g., first class, 
economy), and ticketed fare class (e.g., full fare ticket--Y class). It 
is essentially an anonymous search. The Department seeks comment on the 
benefits, risks, and practicability of the proposed distinction between 
anonymous itinerary searches and passenger-specific searches, as 
described above.
3. Opt-Out Option
    This NPRM does not propose to permit airlines and ticket agents to 
enable consumers to opt out of receiving fee information for critical 
ancillary services during the search process. The Department seeks 
comment on whether it should allow carriers and ticket agents to 
provide consumers an opt-out option from receiving ancillary service 
fee information that would otherwise be required. Opt-out options could 
potentially include the choice to opt out of seeing all baggage fee 
information that would otherwise be required to be displayed (first and 
second checked bag and carry-on bag), to opt out of seeing fee 
information related to changing or canceling a reservation, to opt out 
of seeing seat fee information for a child traveling with an adult, or 
to opt out of seeing some of those fees. We anticipate that fee 
information for critical ancillary services will improve the decisions 
made by consumers but seek comment on whether the volume of information 
proposed to be displayed would assist or overwhelm consumers and 
whether or not an opt-out provision would be beneficial to consumers. 
Is an opt-out provision needed to ensure that consumers can avoid 
receiving ancillary service fee information that is of no interest to 
them? We are also interested in learning what impact, if any, lack of 
an opt-out provision has on the speed of search results or particular 
display options an airline or ticket agent may provide. For commenters 
advocating an opt-out option, we also request information about how to 
define requirements for opt-out options that would adequately protect 
consumers and ensure any opt-out option is not confusing or abused, for 
example, preventing opt-outs accomplished through a ``click wrap'' or 
``browser wrap'' tactic that does not represent a meaningful, 
intentional choice. The Department may consider adopting an opt-out 
provision in the final rule upon review of comments received and on 
further consideration by the Department.
4. Website and Mobile Displays
    The Department is proposing to require that the fees for ancillary 
services that are critical to a consumer's purchasing decision be 
disclosed to consumers using airlines' or ticket agent's websites and 
mobile websites. Consumers in increasing numbers are using mobile 
devices to book travel. The Department believes that it is important 
that the same disclosures that would be provided on airlines' and 
ticket agents' desktop websites be provided on mobile websites. The 
Department seeks comment on whether it should also consider specific 
fee disclosure requirements for airlines' or ticket agents' mobile 
applications (apps). The Department seeks comment on whether the 
proposed disclosure requirements should also extend to airline and 
ticket agent mobile apps, and whether there are any practical 
distinctions between information accessed on mobile websites and mobile 
apps. It would be helpful to the Department for commenters to provide 
data on the percentage of tickets booked on mobile applications, mobile 
websites, and desktop websites, or other usage statistics that are 
relevant.
    The Department is proposing to allow carriers and ticket agents 
limited flexibility in how information on ancillary services is 
displayed on desktop and mobile websites. Although this proposal would 
require carriers and ticket agents to display information for certain 
baggage fees, change fees, cancellation fees, and family seating fees 
at the first point in a search process where a fare is listed in 
connection with a specific flight itinerary, it permits the use of 
links or rollovers for other pieces of information. The Department 
seeks comment on whether links and rollovers would provide the 
necessary flexibility to allow for design displays that would enhance 
the user experience and encourage innovation as technology changes. Are 
additional flexibilities needed to ensure the display of ancillary 
service fee information does not result in screen clutter? Do rollovers 
work on mobile devices that have no cursor to hover over a link? 
Considering the screen size of mobile devices, would the proposed 
display requirement work on mobile platforms? Will there be a danger of 
too much unnecessary information creating confusion if fees that are 
not under consideration are displayed and are there ways the ``too much 
information'' can be mitigated? The Department also requests that 
commenters provide information as to whether hyperlink or other 
disclosures not adjacent to the fare on mobile sites would or would not 
be effective. Should the disclosure requirements be limited to websites 
accessed through desktop applications and not apply to those accessed 
through mobile applications?
In-Person or Telephone Disclosures of Airline Ancillary Service Fees
    In addition to the online disclosures proposed by this rulemaking, 
the Department is proposing similar disclosures for tickets purchased 
using offline means (i.e., tickets purchased by telephone or at the 
ticket counter). Under the proposal, ticket agents and carriers would 
have to disclose to consumers purchasing tickets in-person or on the 
phone the specific baggage fees, change fees, cancellation fees, and 
family seating fees that apply to an itinerary for which a fare is 
quoted to the consumer, adjusted based on the passenger's frequent 
flyer status, method of payment, or other consumer characteristic. 
During a given encounter (phone call, visit), the Department is 
proposing that a ticket agent or carrier not wait until after the 
consumer has decided to make the reservation or purchase the ticket to 
disclose the baggage fees, change fees, cancellation fees or family 
seating fees that may apply. Instead, the disclosure would be required 
to be made at the time that the schedule information is being provided 
to the consumer during the ``information'' and ``decision-making'' 
portion of the conversation. In essence, a carrier or ticket agent 
would not be in compliance if it were to provide a quote for a ticket 
price over the phone or in-person without also providing the baggage, 
change, cancellation, and family seating fees that apply.
    The Department seeks comment on its proposals that carriers and 
ticket agents inform consumers of the bag fees, change and cancellation 
fees, and family seating fees that apply when consumers attempt to 
purchase airline tickets offline, in person, or on the phone. The

[[Page 63729]]

Department is also interested in obtaining input on alternative options 
for providing such fee information on the phone or in person (e.g., 
explaining that fees may apply and referring the consumer to the 
carrier or ticket agent's website, provided that the website is 
accessible to consumers with disabilities).
Sharing of Airline Ancillary Service Fee Information With Ticket Agents
1. Ticket Agents That Sell or Display Airline Fare and Schedule 
Information
    Under this proposal, airlines would be required to distribute fee 
information for critical ancillary services to ticket agents that sell 
or display the airlines' fare and schedule information. Carriers would 
not be required to distribute ancillary service fee information to any 
ticket agent to whom the carrier does not choose to distribute its 
fare, schedule, and availability information. In other words, if a 
carrier does not share fare information with a ticket agent, then this 
proposal would not require that carrier to share ancillary service fee 
information with that ticket agent.
    Also, under this proposal, the method and channels that carriers 
use to distribute fee information to ticket agents would be left to the 
discretion of the carrier.\40\ The Department is not proposing to 
require carriers to distribute ancillary service fee information to 
GDSs because GDSs arrange for air transportation and do not sell or 
display a carrier's tickets directly to consumers. By not requiring 
that ancillary service fee information be provided to GDSs, the 
Department is attempting to minimize government interference with 
business relationships. However, carriers are free to distribute this 
information to GDSs if they choose to do so. GDSs may provide the 
lowest cost and most efficient way of distributing this information to 
ticket agents that sell or display the carrier's ancillary services. 
Most ticket agents currently receive airline fare information through 
GDSs and rely on GDSs as an efficient source of data. Using GDSs may 
facilitate display of critical airline ancillary services. Airlines and 
ticket agents would have to work in good faith to come to agreement on 
the method used to transmit the ancillary service fee information.
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    \40\ Industry stakeholders have expressed their views on 
information distribution in meetings with the Department. In a 
meeting with OACP on December 15, 2021, American Airlines offered 
its view that, while it supports expanded disclosure of ancillary 
service fees, it cautioned the Department against requiring that the 
distribution of such information be made through specific channels, 
such as global distribution systems. In a meeting with OACP on 
February 23, 2022, the Travel Technology Association (TravelTech) 
noted that ancillary fee information can only be provided by ticket 
agents to the extent they receive it from carriers. Travel Tech 
indicated that its members may engage in bilateral agreements with 
airlines to present certain ancillary rule information to consumers 
and in some cases may enable consumers to buy a pre-paid seat 
through their websites.
---------------------------------------------------------------------------

    The Department solicits comment on its preliminary decision not to 
require airlines to share ancillary service fee data with GDSs. Should 
the Department require carriers to distribute the ancillary service fee 
information to all ticket agents, including GDSs, to which the carrier 
provides fare, schedule, and availability information? How would OTAs 
and metasearch sites receive ancillary service fee information from 
multiple airlines and disclose that information to consumers if 
airlines do not provide that information to GDSs? The Department is 
striving to find the most beneficial disclosure rule for consumers 
while avoiding any adverse impact on innovations in the air 
transportation marketplace, contract negotiations between carriers and 
their distribution partners, and a carrier's ability to set its own 
fees and fares in response to its own commercial strategy and market 
forces.
2. Usable, Accurate and Current (Dynamic) Ancillary Service Fee 
Information
    The Department is proposing that U.S. and foreign air carriers 
provide ticket agents ancillary service fee information that is usable, 
accurate, and accessible in real-time. It would not be sufficient for 
carriers to provide static pricing to ticket agents. Under this NPRM, 
carriers would be expected to facilitate the ability of ticket agents 
to access certain baggage fee, change fee, and cancellation fee 
information in a non-static, dynamic fashion. The Department does not 
prescribe the method that carriers would use to distribute the 
information as it wants to minimize government interference and 
encourage innovation. A carrier may choose to distribute ancillary fee 
information through GDSs if it provides the lowest and most efficient 
way to comply, given that many airlines and ticket agents use GDSs 
today. In the United States, three GDSs (Sabre, Travelport and Amadeus) 
distribute the airline product for the ticket agent channel, and most 
airlines use the GDSs to distribute their products to ticket agents, 
including corporate travel agents that sell the higher revenue tickets. 
In the alternative, airlines may choose to distribute the ancillary fee 
information through direct connections between airline reservations 
systems and ticket agent systems. Another option may be to distribute 
ancillary fee information using the International Air Transport 
Association's (IATA) New Distribution Capability (NDC), which is 
essentially an XML-based technical standard for use in airline 
distribution. The Department would expect airlines to work in good 
faith with ticket agents to come to agreement on the method used to 
transmit the ancillary service fee information.
    Under this proposal, carriers would not be required to provide 
information to ticket agents about individual customers but rather the 
itinerary-specific and passenger-specific information that would impact 
the fee for a critical ancillary service. The Department expects that 
carriers and ticket agents would modify how searches for flights are 
done to allow consumers to identify any passenger-specific factors that 
may impact the fees that consumers might pay for critical ancillary 
services. This would enable consumers to better understand the total 
cost of the air transportation to them.
Prohibition on Fee if Required Disclosure Is Not Provided
    Under this proposal, the practice of collecting a fee from 
consumers for critical ancillary services without disclosure of this 
fee during the search process would be deemed an unfair and deceptive 
practice in violation of 49 U.S.C. 41712. Any fee that has been 
unlawfully imposed and collected would need to be refunded to consumers 
by the seller of the air transportation.
Transactability
    The 2017 SNPRM did not propose that ancillary service fees be 
transactable. At the 2022 ACPAC meeting, representatives of the travel 
technology industry recommended that the Department require ancillary 
fee information to be provided to ticket agents in a transactable 
format so that consumers would not have to engage in a separate 
transaction to complete the full purchase of air travel.\41\ Airlines 
stressed that they value transparency of fare and ancillary fee 
information across all channels, and argued that fee information is 
often made available to GDSs and third-party sellers, but that

[[Page 63730]]

information may not be adequately transmitted to consumers.\42\
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    \41\ See presentations of ASTA, Travel Tech, and Amadeus, and 
Skyscanner, available at https://www.transportation.gov/airconsumer/ACPAC/June2022Meeting/webcast (Day 1 afternoon session).
    \42\ See, e.g., presentations of IATA, American and Delta, 
available at https://www.regulations.gov/document/DOT-OST-2018-0190.
---------------------------------------------------------------------------

    The Department is not proposing to require that certain ancillary 
services (i.e., first and second checked bag, one carry-on item, and 
changing or canceling a reservation) be transactable at all points of 
sale. Requiring transactability at all points of sale would mean 
requiring airlines to permit online travel agencies to sell these 
ancillary services. The Department is of the tentative view that this 
is unnecessary, given the regulatory limitations placed on increasing 
these fees following a ticket purchase, as discussed above.
    The Department has not identified evidence of consumer harm 
resulting from a lack of transactability of baggage, change, or 
cancellation fees. A consumer would pay a change or cancellation fee 
only if the consumer makes a change or cancels a reservation. There is 
nothing to transact at the time of ticket purchase. Also, the change 
and cancellation fee that a consumer would pay cannot increase after 
ticket purchase. As for baggage, a consumer is not harmed from not 
being able to pay a fee to transport a first checked bag, a second 
checked bag or a carry-on item at the time of ticket purchase because 
sellers of air transportation cannot increase the fees for these items 
beyond what existed at the time that the consumer purchased the airline 
ticket. The Department's existing rule regarding baggage fee price 
increases and related enforcement policy ensures that the price to 
transport a first checked bag, a second checked bag, or a carry-on item 
does not increase following the ticket purchase and before the consumer 
has the opportunity to purchase baggage transportation services.
    Regarding seat assignment fees for a child 13 or under to be seated 
next to an accompanying adult, the Department is proposing a 
requirement that ticket agents disclose fees for specific seat 
assignments. Such a proposal, without transactability, would cause 
consumers to be presented with seat assignment options that they cannot 
purchase immediately during the booking process, but which could change 
by the time a consumer attempts to purchase the seat. There is a risk 
that consumers would be confused by being presented a seat assignment 
that they cannot obtain at the advertised price. As such, the 
Department is proposing to require that carriers and ticket agents make 
seat fees for a child 13 or under to be seated next to an accompanying 
adult to be transactable at the time the ticket purchase is made. DOT 
has encouraged airlines not to impose such a charge, but to the extent 
they do impose such charges, the proposed rule would require disclosure 
and transactability. This rulemaking may further incentivize airlines 
not to charge fees for a young child to sit next to an accompanying 
adult. The Department welcomes comment on whether airlines' response to 
this rulemaking would include reducing or eliminating such charges. 
Also, the Department solicits comment on requiring airlines to disclose 
that they charge fees for adjacent seating without disclosing the 
amount and requiring that it be transactable as proposed.
Impact on Existing Requirements
    This proposed rule, if adopted, would require carriers and ticket 
agents to provide passenger-specific baggage fee information (if 
passenger-specific information is provided by the consumer) for one 
carry-on item and a first and second checked bag at the first point in 
a search process where a fare is listed in connection with a specific 
flight itinerary. The regulation in 14 CFR 399.85(b) requires carriers 
and ticket agents to state that baggage fees may apply on the first 
screen where a fare quotation is available and refer consumers to a 
page on their websites where this information may be obtained. We are 
tentatively of the view that there would no longer be a need for such a 
requirement except for certain ticket agent displays related to air 
tour packages that are unable to provide customer-specific baggage fee 
information.
    In addition to amending 14 CFR 399.85(b), we are considering 
eliminating the requirement in 14 CFR 399.85(c) regarding disclosure of 
bag fee information on e-ticket confirmations as it may be of limited 
use. Current requirements in 14 CFR 399.85(c) provide that carriers and 
ticket agents must include specific fee information for first and 
second checked bags and a carry-on item on all e-ticket confirmations 
for air transportation, and the fee information must take into account 
factors such as frequent flyer status that affect those charges. Under 
the proposed rule, consumers would have already received this 
information during the search process. We request comment on whether 
there is any benefit in retaining the requirements in 14 CFR 399.85(c) 
if the proposed requirement to display passenger-specific baggage fee 
information is adopted.
    Also, under the existing regulation in 14 CFR 399.85(a), carriers 
must promptly and prominently disclose any increase in bag fees and 
changes in bag allowances on the homepages of their websites for at 
least three months after the change becomes effective. This NPRM does 
not propose substantive changes to this requirement and proposes only 
language changes to clarify the scope of websites the regulation is 
intended to impact. These proposed changes to 14 CFR 399.85(a) are 
intended to make the regulation more consistent with other regulations 
related to carrier and ticket agent websites. We request comment on 
whether the notice provision in 14 CFR 399.85(a) of the existing 
regulation would still be useful to consumers if this NPRM is adopted 
as final.
    The Department is also proposing to amend 14 CFR 399.88, which 
states that any seller of scheduled air transportation within, to, or 
from the United States is prohibited from increasing the price after 
the air transportation has been purchased by the consumer, except in 
the case of an increase in a government-imposed tax or fee if the 
potential for an increase was disclosed as required prior to purchase. 
Under 14 CFR 399.88, the prohibition on increasing the price includes 
increases in fees for ancillary services such as those for checked 
baggage, carry-on baggage, advance or upgraded seating assignments, 
pillows and blankets, and meals, regardless of whether these items are 
purchased along with the air transportation. However, in December 2011, 
the Department announced that with respect to fees for ancillary 
services that were not purchased with the air transportation, it would 
only enforce the prohibition on post-purchase price increases for 
carry-on bags and first and second checked bags.\43\ The application of 
the prohibition of the post-purchase price increase was also at issue 
in a lawsuit filed by two airlines against the Department. The court 
considered the rule as applied under the December 28, 2011, guidance 
and upheld the Department's rule prohibiting post-purchase price 
increases as it is currently being applied.\44\
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    \43\ See also Guidance on Price Increases of Ancillary Services 
and Products not Purchased with the Ticket (December 28, 2011).
    \44\ Spirit Airlines, Inc., v. U.S. Dept. of Transportation 
(D.C. Cir. July 24, 2012), slip op. at 20-21. Petition for Writ of 
Certiorari denied on April 1, 2013.
---------------------------------------------------------------------------

    The Department is proposing to amend Sec.  399.88 to be consistent 
with how it is currently being applied. This rulemaking does not 
propose changes to

[[Page 63731]]

the existing prohibition in Sec.  399.88 against increasing the price 
of air transportation after its purchase, nor does it propose 
additional ancillary services beyond baggage that has traditionally 
been included in the price of a ticket to be frozen at the time of 
ticket purchase. In other words, the proposed amendment to Sec.  399.88 
would continue to require sellers of scheduled air transportation to 
apply the bag fee policies and fees that existed at the time the ticket 
is purchased for the first and second checked bag and carry-on item. 
For example, if the standard first checked bag fee at the time of 
ticket purchase is $30 when purchased in advance, $50 when purchased at 
the airport, and free for an elite frequent flyer, then the passenger 
would not pay a bag fee if he or she maintains the elite frequent flyer 
status on the date of travel. However, if the passenger does not 
maintain the same status and pays for the bag at the airport, the 
passenger would pay $50 for the first checked bag. The Department seeks 
comment on its amendment of Sec.  399.88. Should the Department require 
that the price for ancillary services not purchased with the ticket be 
frozen beyond first and second checked bag and a carry-on item? For 
example, should it extend to fees for all baggage (including fees for 
oversized or overweight bags) or all ancillary services that have been 
identified as being critical to a consumer's purchasing decision?
    Further, the Department is proposing non-substantive changes to the 
current requirement in 14 CFR 399.84(a) that when a carrier or ticket 
agent quotes a price in advertising or a solicitation, the price should 
be the total fare, inclusive of taxes and fees. The proposed changes 
consist of minor changes to Sec.  399.84(a) to promote readability, as 
well as additional language to accommodate the ancillary fee 
disclosures proposed in this NPRM. More specifically, we are proposing 
that if a consumer wishes to view ancillary service fees such as bag 
fees incorporated into the total quoted price during an itinerary 
search, carriers and ticket agents would be permitted to display the 
total price of the transportation, inclusive of mandatory taxes and 
fees and the consumer's selected ancillary service fees, more 
prominently than a price that includes only all mandatory charges. The 
Department is seeking comment on this clarification to 14 CFR 
399.84(a). Again, these language adjustments are not intended to make 
substantive changes to the full fare rule.
    As stated in 14 CFR 399.84(a), carriers and ticket agents may state 
separately charges included within the single total price on their 
websites, but such charges may not be false or misleading, may not be 
displayed more prominently than the total price, may not be presented 
in the same or larger size as the total price, and must provide cost 
information on a per passenger basis that accurately reflects the cost 
of the item covered by the charge. Consistent with this requirement, 
advertisements that state discounts in the form of percentage-off sales 
must refer to a discount off the total price to be paid by the consumer 
for the ticket, unless the airline or ticket agent explicitly states 
that the discount is based on only a portion of the fare. For example, 
an advertisement that indicates air transportation is on sale for a 
percentage off but does not apply the discount to the total price would 
be misleading if it did not specify that it is a percentage off only 
the ``base'' fare or other fare component. When the terms ``flight,'' 
``ticket,'' or ``fare'' are used in an advertisement stating a 
percentage off, a reasonable consumer would understand that the 
percentage off applies to the total price of the transportation. The 
Department is of the view that it would be an unfair and deceptive 
practice for an airline or ticket agent to advertise discounts off a 
``flight,'' ``ticket,'' or ``fare,'' without disclosing in the first 
instance that the discount is only applied to a component of the total 
price (e.g., the ``base'' fare). The practice is unfair in that 
consumers are likely to encounter higher charges than expected, which 
can multiply if a consumer relies on the promotional discount for 
multiple passengers on an itinerary. The harm is not easily avoided due 
to a lack of clarity in the advertising language that carriers use. The 
Department has also not identified any benefits to consumers or to 
competition from this practice. The practice is also deceptive in that 
the carriers' advertising is likely to mislead consumers into believing 
that the discount will be applied to the entire ticket price (i.e., the 
full fare), rather than only a portion of the price to be paid. The 
belief that a discount applies to the total price when the 
advertisement provides a discount off of the ``flight,'' ``ticket,'' 
``fare,'' or other terms of this nature, is reasonable. The total 
required charge that a consumer will be made to pay for air 
transportation is also material. The Department is also concerned that 
there is lack of clarity about the meaning of the term ``base'' fare. 
In some cases, even offering a discount off the ``base fare'' may be 
misleading if, without more clarity, the discount only applies to a 
portion of the carrier-imposed charges, and not the total amount of 
carrier-imposed charges (i.e., the fare for the transportation plus 
carrier-imposed charges such as fuel surcharges and other mandatory 
carrier fees). The Department solicits comment on defining base fare to 
mean all of the carrier-imposed charges included within the total 
price. The Department is soliciting comment on whether the full fare 
regulation should be amended to provide greater clarity on this type of 
advertising.
Compliance Period
    The Department is tentatively of the view that a six-month 
implementation period from the issuance date of a final rule would be 
appropriate for carriers and ticket agents to display a first and 
second checked bag fee, a carry-on bag fee, change and cancellation 
fee, and family seating fees to consumers whenever fare and schedule 
information is provided online. It also provides sufficient time to 
train agents to provide fee information for critical ancillary services 
to consumers when providing fare and schedule information in person or 
over the phone. It also takes into account the time needed for carriers 
to share ancillary service fee information with ticket agents.
    In proposing this implementation period, the Department also 
considered the time that would be needed for airlines and ticket agents 
to organize ancillary fee data and reprogram and test their websites. 
Separately, the Department considers the time needed to determine how 
ancillary service fee information will be distributed from carriers to 
ticket agents. At the June 2022 ACPAC meeting, one airline 
representative indicated that broadly speaking, sharing ancillary fee 
data with ticket agents is not technologically difficult and could be 
accomplished within a short time frame.\45\ If this proposal were to 
become a final rule, we would anticipate carriers will work in good 
faith with ticket agents to ensure that the distribution method and 
details are worked out well in advance of the display deadline. We 
request comment on whether the Department should impose a date certain 
by which carriers must share ancillary service fee information with 
ticket agents.
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    \45\ Remark of American Airlines, available at June 28 and 29, 
2022 Meeting of the Aviation Consumer Protection Advisory Committee 
(ACPAC) [bond] U.S. Department of Transportation (Day 1 afternoon 
session).
---------------------------------------------------------------------------

    We also seek comment on whether proposed implementation periods are 
too lengthy or too short. If the proposed implementation periods are 
either too lengthy or too short, how long of an

[[Page 63732]]

implementation period would be appropriate and why?

Regulatory Notices

Executive Order 12866 (Regulatory Planning and Review) and DOT 
Regulatory Policies and Procedures

    The Office of Management and Budget has determined that this 
proposed rule is a significant regulatory action under Executive Order 
12866 and requires an assessment of potential benefits and costs. 
Accordingly, the Department has prepared a regulatory impact analysis 
for the proposed rule, summarized in this section and available in the 
docket.
    The proposed rule changes how U.S. air carriers, foreign air 
carriers, and ticket agents disclose information about certain 
ancillary fees for flights and changes how certain customers can 
purchase assigned seats. Ancillary fees are fees for optional services 
provided by a carrier beyond passenger air transportation. The proposed 
rule would require carriers and ticket agents to show baggage fees, 
ticket change fees, and ticket cancellation fees when they first show 
fares and schedules to consumers searching for flights. The proposed 
rule would also require the seating fees for children 13 or under to be 
shown by airlines and ticket agents that display or sell tickets 
whenever fare and schedule information is provided. In addition, the 
Department is proposing that consumers be able to transact (i.e., 
purchase) these fees from airlines and ticket agents that sell tickets. 
Finally, the proposed rule would require carriers and ticket agents to 
provide the same ancillary fee information to consumers buying tickets 
in person or on the phone.
    The regulatory impact analysis uses a basic economic model of 
asymmetric information as a framework for evaluating the proposed rule. 
Due to a lack of data and other significant uncertainties, it is not 
possible to evaluate the effects of the proposed rule quantitatively.
    The rulemaking would yield societal benefits if it leads to reduced 
deadweight loss from inaccurate price calculations or reduced search 
costs. Inaccurate price calculations lead to overconsumption and can 
distort consumer perceptions in ways that confer a competitive 
advantage to producers who produce a lower-quality product. While we 
lack information to estimate benefits, we calculated a hypothetical 
example range using methods from earlier rulemakings. At the same time, 
the rulemaking could conceivably lead to crowding out of relevant 
information for some consumers. The potential effect represents an 
offset to benefits, and it is possible that it equals or outweighs the 
benefits. Thus, it is not possible to quantify at this time whether the 
proposed rule yields benefits that exceed costs.
    The primary costs of the proposed rule are the costs that carriers 
and ticket agents would incur to share ancillary fee data, modify 
websites, and allow transactability for assigned seats for children 13 
or under. These costs include startup implementation costs as well as 
ongoing costs. Third parties involved in data exchange, such as global 
distribution systems (GDSs)) and direct-channel companies, would incur 
costs as well despite not being directly regulated by the rule. Because 
these entities are already starting to upgrade systems for market 
reasons, the cost properly associated with the proposed rule is the 
cost of requiring them to upgrade earlier than they would without the 
rule.
    Table 1 summarizes the results of the analysis and the potential 
economic effects of the proposed rule.

               Table 1--Summary of Annual Economic Effects
------------------------------------------------------------------------
                     Item                            Annual amount
------------------------------------------------------------------------
Benefits:
Gross benefits:
    Reduction in deadweight loss due to        See illustrative example
     increased accuracy in consumers' price     in regulatory impact
     calculations.                              analysis (RIA).
    Reduction in search costs for consumers    See illustrative example
     seeking information on ancillary fees..    in RIA.
    Reduction in surprise costs and anxiety    Not estimated.
     for passengers traveling with children.
    Market feedback effects (enhanced price    Not estimated.
     and quality combinations).
Offsets to gross benefits:
    Increase in search costs for consumers     Not estimated.
     seeking information on items displaced
     by new disclosures.
        Total benefits.......................  Indeterminate.
Costs:
    Implementation and contract negotiation    See illustrative example
     costs for carriers, ticket agents, GDS     in RIA.
     companies, and direct-connect companies
     to display ancillary fees and allow
     transactability for assigned seats for
     children 13 or under.
    Ongoing costs for carriers to provide      See illustrative example
     data.                                      in RIA.
    Ongoing costs for carriers and ticket      Not estimated.
     agents to exchange and maintain
     ancillary fee information for offline
     and in-person purchases.
        Total costs..........................  Not estimated.
Transfers:
    Gains in consumer surplus (from airlines   Indeterminate.
     back to consumers).
        Net benefits.........................  Indeterminate.
------------------------------------------------------------------------

    Table 2 summarizes the key uncertainties for quantifying or 
monetizing the economic effects of the proposed rule. The same 
uncertainties that prevent the estimation of primary impacts preclude 
the assessment of potential secondary effects, including effects on 
airfares, ancillary fees, ancillary services, or GDS contracts with 
carriers and ticket agents. The Department seeks comment on these 
issues, as well as on potential implementation costs of the proposed 
rule and the potential changes on consumer search costs and decision-
making.

[[Page 63733]]

 Table 2--Summary of Key Uncertainties for Quantifying Economic Effects
------------------------------------------------------------------------
                     Item                            Annual amount
------------------------------------------------------------------------
Benefits:
Gross benefits:
    Reduction in deadweight loss due to         Amount of price
     increased accuracy in consumers' price     mistake.
     calculations.                              Number of
                                                passengers who do not
                                                incorporate full
                                                information into price
                                                calculation.
                                                Number of
                                                passengers who would
                                                choose not to use
                                                ancillary services with
                                                full price information
                                                versus those who would
                                                forgo air travel
                                                altogether.
    Reduction in search costs for consumers     Amount of time
     seeking information on ancillary fees.     saved.
                                                Number of
                                                consumers who would save
                                                time shopping for
                                                airline fares.
    Reduction in surprise costs and anxiety     Number of
     for passengers traveling with children.    consumers unaware of
                                                ancillary fees.
Offsets to gross benefits:
    Increase in search costs for consumers      Increase in
     seeking information on items displaced     search time.
     by new disclosures.                        Number of
                                                consumers who experience
                                                increased search time.
Costs:
    Implementation and ongoing costs for        Needed changes
     carriers, ticket agents, GDS companies,    to websites.
     and direct-connect companies to display    Needed changes
     ancillary fees and allow transactability   to programming.
     for assigned seats for children 13 or
     under.
    Ongoing costs for carriers and ticket       Amount of
     agents to exchange and maintain            training required to
     ancillary fee information for offline      enable ticket agents to
     and in-person purchases.                   use ancillary fee
                                                information.
Transfers:
    Gains in consumer surplus (from airlines    Extent to which
     back to consumers).                        existing industry
                                                pricing practices
                                                increase producer
                                                surplus (profits).
------------------------------------------------------------------------

Executive Order 13132 (Federalism)

    This NPRM has been analyzed in accordance with the principles and 
criteria contained in Executive Order 13132 (``Federalism''). This NPRM 
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.

Executive Order 13175

    This NPRM 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 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 13084 do not apply.

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).
    The Department has prepared an IRFA for this proposed rule, 
summarized in this section and available at regulations.gov under 
Docket No. DOT-OST-2022-0109.
    The proposed rule would have some impact on U.S. air carriers, 
foreign air carriers and ticket agents that qualify as small entities. 
It would also have some impact on Global Distribution Systems (GDSs), 
but none of the three major GDS companies in the market (Amadeus, 
Sabre, and Travelport) qualify as small businesses.
    A carrier is a small entity if it provides air transportation 
exclusively with small aircraft, defined as any 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, as described in 14 
CFR 399.73. In 2020, 28 carriers meeting these criteria reported 
passenger traffic data to the Bureau of Transportation Statistics.\46\
---------------------------------------------------------------------------

    \46\ Bureau of Transportation Statistics. No date. ``T1: U.S. 
Air Carrier Traffic and Capacity Summary by Service Class.'' https://transtats.bts.gov/.
---------------------------------------------------------------------------

    A ticket agent is a small entity if it has total annual revenues 
below $22 million.\47\ This amount excludes funds received in trust for 
an unaffiliated third party, such as bookings or sales subject to 
commissions, but includes commissions received. In 2017, the latest 
year with available data, 7,827 travel agency establishments had annual 
revenues of less than $25 million.\48\ This number overestimates the 
number of small entities because some establishments may have annual 
revenues greater than $22 million.
---------------------------------------------------------------------------

    \47\ See https://www.sba.gov/document/support--table-size-
standards, NAICS Code 561510.
    \48\ U.S. Census Bureau. 2022. ``Economic Census.'' https://www.census.gov/programs-surveys/economic-census.html.
---------------------------------------------------------------------------

    The proposed rule could have impacts on small entities because 
carriers and ticket agents would incur costs to modify websites and 
upgrade systems to exchange ancillary fee data. Because the Department 
could not estimate these costs reliably, it could not determine whether 
the proposed rule would impose a significant impact on a substantial 
number of small entities. The Department seeks comment on the potential 
implementation costs of the proposed rule for small entities.

[[Page 63734]]

Paperwork Reduction Act

    Under the Paperwork Reduction Act (44 U.S.C. 3501 et seq.) (PRA), 
no person is required to respond to a collection of information unless 
it displays a valid Office of Management and Budget (OMB) control 
number. The Department invites interested parties to comment on the 
information collection requirements contained in this document. As 
prescribed by the PRA, the requirement will not go into effect until 
OMB has approved the requirement.
    This NPRM proposes three new information collections: (1) U.S. air 
carriers, foreign air carriers, and ticket agents must disclose, during 
the booking process, applicable fee information for the first and 
second checked baggage and for carry-on baggage, applicable fee and 
policy information for changing and cancelling reservations, and, for 
bookings that involve a passenger 13 or under, the seat fee, if any, 
for the child passenger to be seated next to an accompanying adult; (2) 
air carriers, foreign air carriers, and ticket agents must disclose 
their policy on 24-hour ticket hold or cancellation; and (3) air 
carriers and foreign air carriers must ensure that partner carriers and 
ticket agents receive information regarding certain baggage fees, 
change and cancellation fees and policies, and family seating fee so 
that the partner carriers and ticket agents can accurately provide such 
information to consumers and so that the family seating fee can be 
transactable at the point of ticket purchase.
    For each of the information collections, the title, a description 
of the respondents, and an estimate of the burdens are set forth below:
    1. Requirement that U.S. air carriers, foreign air carriers, and 
ticket agents disclose, during the booking process, the applicable fee 
information for the first and second checked baggage, one carry-on bag, 
the applicable fee and policy information for changing and canceling 
reservation, and the seat fee, if any, for a passenger 13 or under to 
be seated next to an accompanying adult.
    Title: Disclosure of Ancillary Fees and Policies During the Air 
Transportation Booking Process:
    Respondents: U.S. carriers, foreign air carriers, and ticket agents 
that sell or display carrier fare and schedule information to consumers 
in the United States.
    Number of Respondents: We estimate that as many as 206 U.S. air 
carriers and foreign air carriers and as many as 600 ticket agents may 
be impacted by this requirement. Our estimate is based on the following 
information and assumptions: Ticket agents includes online travel 
agencies (OTAs), brick-and-mortar travel agencies, corporate travel 
agencies, and tour operators that market airline tickets. There may be 
approximately 9,500 travel agencies and over 2,500 tour operators in 
the United States, although not all of those entities market air 
transportation online to consumers in the United States. In addition, 
most ticket agents rely on global distribution systems (GDSs) to create 
online fare and schedule displays. GDSs and entities that create or 
develop and maintain their own online fare and schedule displays, such 
as many of the impacted carriers and the largest travel agents, will 
incur some planning, development, and programming costs to reprogram 
their systems to provide online displays of fare and schedule 
information that includes baggage fee information on their websites. 
For these reasons, we assume that about five percent of United States 
ticket agents, including GDSs and large travel agencies, or as many as 
600 ticket agents, would be impacted by this requirement. Many smaller 
carriers also rely on GDSs to create online fare and schedule displays 
so our estimate of 206 impacted carriers may be overstated.
    Estimated Annual Burden on Respondents: Approximately 80 hours per 
respondent. Our estimate is based on the following information and 
assumptions: the primary costs to respondents for the disclosure 
requirement would arise from programming, data management, website 
modification, and other related costs to carriers and ticket agents to 
display the required ancillary fee information. Revising website 
displays in this manner would likely be similar to the revisions that 
carriers and ticket agents needed to make to their websites to comply 
with the requirement to include all taxes and fees in fare displays 
(``full fare rule''), as prescribed by the Enhanced Airline Passenger 
Protections II rulemaking.\49\ In that rulemaking, the Department 
estimated that compliance with the full fare rule would require 
approximately 80 hours per respondent.\50\
---------------------------------------------------------------------------

    \49\ 76 FR 23110 (Apr. 25, 2011).
    \50\ See Regulatory Impact Analysis on page 59, available at 
https://www.regulations.gov/document?D=DOT-OST-2010-0140-2046.
---------------------------------------------------------------------------

    The burdens in this rulemaking are expected to be incurred one time 
by regulated entities. Once the modifications required by this 
information collection have been incorporated into the websites of 
regulated entities, we do not expect that this information collection 
will impose additional ongoing costs, such as website maintenance, for 
regulated entities who have been operating websites prior to the 
promulgation of this rulemaking. As currently proposed, this rulemaking 
would not require the creation of new websites by regulated entities 
that did not already maintain websites for the purpose of selling air 
transportation. For those entities selling air transportation through 
other means, such as by phone, the rule would require that such 
entities inform consumers about certain ancillary service fees at the 
time a fare is quoted. Due to the relatively marginal increase in time 
needed to orally convey the information required by this information 
collection, the burden of this information collection with respect to 
offline purchases of air transportation is expected to be minimal.
    Estimated Total Annual Burden: Approximately 64,480 hours for all 
respondents (based on an assumption of 16,480 hours for carriers and 
48,000 hours for ticket agents). Based on an estimated mean hourly wage 
of $45.90 for web and digital interface designers,\51\ this results in 
a total annual cost of $2,959,632 ($756,432 for carriers and $2,203,200 
for ticket agents).
---------------------------------------------------------------------------

    \51\ https://www.bls.gov/oes/current/oes151255.htm.
---------------------------------------------------------------------------

    Frequency: Once information is incorporated into website displays, 
this rulemaking would not require further modifications to websites. 
Ongoing website costs (such as for maintenance) are expected to be 
unchanged by this rulemaking.
    2. Requirement that U.S. air carriers, foreign air carriers, and 
ticket agents disclose on their websites 24-hour hold or cancellation 
policies.
    Title: Disclosure of 24-hour hold or cancellation policy on carrier 
and ticket agent websites during the booking process.
    Respondents: U.S. carriers, foreign air carriers, and ticket agents 
that sell or display carrier fare and schedule information to consumers 
in the United States.
    Number of Respondents: We estimate that the same regulated entities 
impacted by Information Collection 1 would be impacted by this 
requirement. Our estimates include 206 U.S. air carriers and foreign 
air carriers and as many as 600 ticket agents.
    Estimated Annual Burden on Respondents: Approximately 80 hours per 
respondent. The primary costs to respondents would arise from the 
design, programming, and modification of websites to display 24-hour 
hold and

[[Page 63735]]

cancellation policy information, which is primarily static, prior to 
the ticket purchase. This rulemaking would not require the creation of 
new websites by regulated entities that did not already maintain 
websites for the purpose of selling air transportation.
    Estimated Total Annual Burden: This information collection would 
result in an estimated annual burden of 48,360 hours (based on an 
assumption of 12,360 hours for carriers and 36,000 hours for ticket 
agents).
    3. Requirement that U.S. air carriers and foreign air carriers 
ensure that partner carriers and ticket agents receive information 
regarding certain baggage fees, change and cancellation fees and 
policies, and family seating fee so the partner carriers and ticket 
agents can accurately provide such information to consumers.
    Title: Disclosure of baggage and other fee information to partner 
carriers and ticket agents.
    Respondents: U.S. air carriers and foreign air carriers that 
provide fare, schedule, and availability information to ticket agents 
to sell or display flights within, to, or from the United States.
    Number of Respondents: We estimate that approximately 206 carriers 
will be impacted by this requirement. This includes foreign carriers 
that may not serve the United States on their own equipment but may 
sell connecting itineraries between the United States and a foreign 
point, when at least one of the foreign-to-foreign segments is operated 
by the foreign carrier.
    Estimated Annual Burden on Respondents: Approximately 16 hours per 
respondent. The proposed information collection would require carriers 
to either distribute baggage fee and family seating information or make 
the specific policies, including the calculation of baggage and seat 
fees applicable for passenger-specific itineraries, available to third 
parties. Carriers selling tickets in the United States already display 
baggage and ancillary fee information on their websites, as required by 
existing regulation (14 CFR 399.85(d)). This information includes the 
use of baggage fee calculators and other tables accessible to 
consumers. The rulemaking would require that this information be made 
available in such a way that partner carriers and ticket agents have 
access to this information in a non-static, dynamic format such that 
the partner carriers and ticket agents can disclose baggage fee and 
family seating information to consumers during each itinerary search 
and to allow for the purchase of a seat fee for a child passenger at 
the same time as the ticket purchase. Because partner carriers already 
have mechanisms to share this information with third parties, the 
additional modifications that would be required by this information 
collection are not expected to be significant. Moreover, carriers 
already share this information with each other (i.e., partner carriers) 
to facilitate codeshare and interline ticketing. This potential burden 
of sixteen hours per respondent, as referenced here, may overestimate 
the actual burden for most carriers.
    Estimated Total Annual Burden: This information collection would 
result in an estimated annual burden of 3,296 hours. Based on an 
estimated mean hourly wage of $46.46 for computer programmers,\52\ this 
results in a total cost of approximately $153,132.
---------------------------------------------------------------------------

    \52\ https://www.bls.gov/oes/current/oes151251.htm.
---------------------------------------------------------------------------

    The Department invites interested persons to submit comments on any 
aspect of each of these information collections, including the 
following: (1) The necessity and utility of the information collection, 
(2) the accuracy of the estimate of the burden, (3) ways to enhance the 
quality, utility, and clarity of the information to be collected, and 
(4) ways to minimize the burden of collection without reducing the 
quality of the collected information. Comments submitted in response to 
this NPRM will be summarized or included, or both, in the request for 
OMB approval of these information collections.

Unfunded Mandates Reform Act

    The Unfunded Mandates Reform Act of 1995 (UMRA) requires, at 2 
U.S.C. 1532, that agencies prepare an assessment of anticipated costs 
and benefits before issuing any rule that may result in the expenditure 
by State, local, and tribal governments, in the aggregate, or by the 
private sector, of $100 million or more (adjusted annually for 
inflation) in any one year. As described elsewhere in the preamble, 
this proposed rule would have no such effect on State, local, and 
tribal governments or on the private sector. Therefore, the Department 
has determined that no assessment is required pursuant to UMRA.

National Environmental Policy Act

    The Department has analyzed the environmental impacts of this 
proposed action pursuant to the National Environmental Policy Act of 
1969 (42 U.S.C. 4321 et seq.) (NEPA) 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). See 40 CFR 
1508.4. 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. Id. 
Paragraph 4(c)(6)(i) of DOT Order 5610.1C provides that ``actions 
relating to consumer protection, including regulations'' are 
categorically excluded. The purpose of this rulemaking is to enhance 
protections for air travelers and to improve the air travel experience. 
The Department does not anticipate any environmental impacts, and there 
are no extraordinary circumstances present in connection with this 
rulemaking.

    Signed this 25th day of September 2022, in Washington, DC.
Peter Paul Montgomery Buttigieg,
Secretary of Transportation.

List of Subjects in 14 CFR Part 399

    Air carriers, Consumer protection, Enforcement.

    For the reasons stated in the preamble, DOT proposes to amend 14 
CFR chapter II, subchapter F, as follows:

PART 399--STATEMENTS OF GENERAL POLICY

0
1. The authority citation for part 399 continues to read as follows:

    Authority: 49 U.S.C. 41712, 40113(a).

0
2. Revise Sec.  399.80(s) to read as follows:

Sec.  399.80  Unfair and deceptive practices of ticket agents.

* * * * *
    (s) Failing to disclose and offer web based discount fares to 
prospective passengers who contact the agent through other channels 
(e.g., by telephone or in the agent's place of business) and indicate 
that they are unable to use the agent's website due to a disability and 
failing to disclose ancillary service fee information (as required by 
Sec.  399.85) to prospective passengers who contact the agent through 
other channels (e.g., by telephone or in the agent's place of 
business). The disclosure of ancillary service fee information (as 
required by Sec.  399.85) must be made at the time that the schedule 
information is being provided to the consumer.
0
3. Revise Sec.  399.84(a) to read as follows:

[[Page 63736]]

Sec.  399.84  Price advertising and opt-out provisions.

    (a) The Department considers any advertising or solicitation by a 
direct air carrier, indirect air carrier, an agent of either, or a 
ticket agent, for passenger air transportation, a tour (i.e., a 
combination of air transportation and ground or cruise accommodations) 
or tour component (e.g., a hotel stay) that must be purchased with air 
transportation that states a price for such air transportation, tour, 
or tour component to be an unfair and deceptive practice in violation 
of 49 U.S.C. 41712, unless the price stated is the entire price to be 
paid by the customer to the carrier, or agent, for such air 
transportation, tour, or tour component.
    (1) Charges included within the single total price listed (e.g., 
government taxes) may be stated separately or through links or ``pop 
ups'' on websites that display the total price, but such charges may 
not be false or misleading, may not be displayed prominently, may not 
be presented in the same or larger size as the total price, and must 
provide cost information on a per passenger basis that accurately 
reflects the cost of the item covered by the charge.
    (2) An airline or ticket agent may display a price that includes 
all mandatory charges and one or more ancillary service fees more 
prominently than a price that only includes all mandatory charges.
* * * * *
0
4. Revise Sec.  399.85 to read as follows:

Sec.  399.85   Notice of ancillary service fees.

    (a) Definitions. For purposes of this section, the following 
definitions apply:
    Ancillary service fee means the fee charged for any optional 
service the U.S. or foreign air carrier provides beyond passenger air 
transportation. Such fees may include, but are not limited to, charges 
for checked or carry-on baggage, canceling or changing a reservation, 
advance seat selection, in-flight beverages, snacks and meals, lounge 
access, bedding or other amenities, or seat upgrades.
    Ancillary service package means a package or bundle of one or more 
ancillary services offered for sale by a carrier or ticket agent. Such 
packages are typically offered after the consumer has selected an 
itinerary and fare category during the booking process. Carriers and 
ticket agents are not required to offer ancillary service packages.
    Anonymous itinerary search means a search conducted on the website 
of a U.S. carrier, a foreign air carrier, or ticket agent, that does 
not take into account information specific to a characteristic of the 
passenger that impacts the ancillary service fees to be charged or 
other parameters relevant to these fees (e.g., size and weight 
limitations on baggage).
    Consumer or user means the person who uses the website of a U.S. 
carrier, a foreign carrier, or ticket agent, to search for and/or 
purchase air transportation. ``Consumer'' or ``user'' may also refer to 
a person who seeks to obtain information about air transportation, 
whether through a website or other means.
    Passenger-specific itinerary search means a search conducted on the 
website of a U.S. carrier, foreign air carrier, or ticket agent that 
takes into account information specific to a characteristic of the 
passenger that may impact the ancillary service fees to be charged or 
other parameters relevant to these fees (e.g., size and weight 
limitations on baggage). Such information could include the passenger's 
status in the airline's frequent flyer program, the passenger's 
military status, or the passenger's status as a holder of a particular 
credit card. An itinerary search is ``passenger-specific'' when a user 
has provided passenger-specific information prior to conducting the 
search, including when conducting previous searches if the information 
is cached, or if the user conducts a search while logged into the 
search website and the operating entity of that website has passenger-
specific information as part of the user's profile.
    (b) Online fee disclosures of baggage. Each U.S. air carrier, 
foreign air carrier, and ticket agent that has a website marketed to 
U.S. consumers where it advertises or sells air transportation must 
accurately display (or cause to be displayed) the fee that applies, if 
any, to an itinerary for a first checked bag, a second checked bag, and 
a carry-on bag. The fees must be included on the first page displayed 
when a consumer conducts a search for air transportation when fare and 
schedule information is shown. Display of the baggage fee by links or 
rollovers is not permitted. Ancillary service fees other than those 
referenced in this paragraph (b) may also be displayed on the same 
page, at the carrier or ticket agent's discretion. All fees displayed 
must be the total to be paid by the consumer for the ancillary service.
    (1) Consumers must be offered both the option to conduct a 
passenger-specific itinerary search and the option to conduct an 
anonymous itinerary search. For passenger-specific itinerary searches, 
the fees required to be displayed under this paragraph (b) must be 
adjusted to reflect accurately the itinerary of the passenger, the fare 
category displayed or selected, and the status of the passenger. For 
anonymous itinerary searches, the fees required to be displayed under 
this paragraph (b) must be adjusted to reflect accurately the itinerary 
of the passenger and the fare category displayed or selected, without 
taking into account passenger-specific information.
    (2) If the carrier or ticket agent displays multiple fare 
categories for the same flight in response to an itinerary search 
(e.g., the search results page displays basic economy, restricted 
economy, flexible economy, and business class fares simultaneously for 
the same flight), the carrier or ticket agent must display the bag fees 
applicable to each fare category associated with that fee. In 
circumstances where a particular fare category prohibits the checking 
of a bag or the carriage of a carry-on bag, the carrier or ticket agent 
must indicate that the item is prohibited under the fare category and 
display the penalty, if applicable, for carrying on or checking the 
item.
    (3) If the carrier does not display any fee for a first or second 
checked or carry-on bag at the time the consumer searches for and 
purchases air transportation, the carrier may not impose a fee on the 
consumer for a checked or carry-on bag following the ticket purchase. 
If a ticket agent does not display any fee for a checked or carry-on 
bag at the time the consumer searches for and purchases air 
transportation, the ticket agent must promptly refund the consumer for 
any bag fee the carrier imposes on the consumer for the itinerary.
    (4) In displaying the applicable bag fee required by this paragraph 
(b), each U.S. carrier, foreign air carrier, or ticket agent, must 
display the weight and dimension limitations that the carrier imposes 
for each checked bag and carry-on bag. Such limitation information may 
be displayed using links or pop-ups adjacent to the display of the bag 
fee. For passenger-specific itinerary searches, the weight and 
dimension limitations must be adjusted to the level applicable to the 
passenger based on the passenger-specific information provided.
    (5) If a carrier or ticket agent offers for sale an ancillary 
service package that includes baggage, it may display the package and 
the package price in addition to the standalone bag fees, if any, 
already required under paragraph (b)(1) of this section.
    (6) For air-tour packages sold online by ticket agents where the 
carrier

[[Page 63737]]

providing air transportation is not known at the time of booking, 
ticket agents are not required to provide specific baggage fee 
information as required by this paragraph (b). In such cases, the 
ticket agent must clearly and prominently disclose on the first screen 
in which the ticket agent offers a package fare quotation for a 
specific itinerary selected by a consumer that additional airline fees 
for baggage may apply and that those fees may be reduced or waived 
based on the passenger's frequent flyer status, method of payment, or 
other consumer characteristic. Once the carrier providing air 
transportation for an air-tour package is known, the ticket agent must 
provide baggage fee information as prescribed by this paragraph (b) 
both to prospective consumers and to consumers who purchased the air-
tour package before the identity of the carrier providing the air 
transportation became known.
    (c) Online disclosure of cancellation and change fees. Each U.S. 
carrier, foreign air carrier, and ticket agent that has a website 
marketed to U.S. consumers where it advertises or sells air 
transportation must accurately display, on the first page when a 
consumer conducts a search for air transportation and fare and schedule 
information is shown, the applicable fee for the consumer to change the 
reservation and cancel the reservation. Display of the cancellation and 
change fee by links or rollovers is not permitted. The fee displayed 
must be specific to each fare category displayed and adjusted based on 
passenger-specific information provided by the consumer. The carrier or 
ticket agent must also display the following information, which may be 
with the use of links or pop-ups adjacent to the pertinent fee:
    (1) A summary of the applicable cancellation policy for the 
itinerary displayed, adjusted based on the consumer's passenger-
specific and itinerary-specific information provided, if applicable; 
and
    (2) A summary of the applicable ticket change policy for the 
itinerary displayed, adjusted based on the consumer's passenger-
specific and itinerary-specific information provided, if applicable.
    (d) Online disclosure of 24-hour change and cancellation policy. 
Each U.S. carrier, foreign air carrier, and ticket agent that has a 
website marketed to U.S. consumers where it sells air transportation 
must display a statement, before the consumer can execute his or her 
purchase or reservation of air transportation, indicating whether the 
consumer's booking can be cancelled without penalty within 24 hours of 
booking, or whether the consumer has the option to hold the reservation 
for 24 hours at the quoted price without executing the purchase, 
consistent with the carrier or ticket agent's policy and, for carriers, 
consistent with 14 CFR 259.5(b)(4).
    (e) Online disclosure and transactability of family seating fee. 
Each U.S. carrier, foreign air carrier, and ticket agent that has a 
website marketed to U.S. consumers where it advertises or sells air 
transportation must disclose to each consumer seeking to purchase air 
transportation in which at least one passenger is 13 years of age or 
under, wherever fare and schedule information is provided, the fee, if 
any, for the passenger age 13 years or under to be seated adjacent to 
the seat of an accompanying adult in the same class of service. This 
fee must be displayed alongside the quoted fare associated with each 
itinerary search result. Display of the family seating fee by links or 
rollovers is not permitted. Each U.S. carrier, foreign air carrier, and 
ticket agent that has a website marketed to U.S. consumers where it 
sells air transportation must also enable the consumer to select and 
purchase the seat at the time the seat fee is disclosed if the consumer 
chooses to do so.
    (f) Disclosures for tickets not purchased online. For tickets 
purchased by consumers in the United States in person or by phone, each 
U.S. carrier, foreign carrier, and ticket agent must disclose to 
consumers the baggage fees, change fees, cancellation fees, and family 
seating fees (i.e., the fee for a passenger 13 or under to obtain a 
seat next to an accompanying adult, if the carrier imposes such a fee 
and the consumer's intended booking includes a passenger age 13 or 
under) that apply at the time a fare is quoted for an itinerary. The 
fees disclosed must be adjusted based on passenger-specific information 
provided by the consumer.
    (g) Changes in baggage fees. If a U.S. or foreign air carrier has a 
website marketed to U.S. consumers where it advertises or sells air 
transportation, the carrier must promptly and prominently disclose any 
increase in its fee for carry-on or first and second checked bags and 
any change in the first and second checked bags or carry-on allowance 
for a passenger on the homepage of that website (e.g., provide a link 
that says ``changed bag rules'' or similarly descriptive language and 
takes the consumer from the homepage directly to a pop-up or a place on 
another web page that details the change in baggage allowance or fees 
and the effective dates of such changes). Such notice must remain on 
the homepage for at least three months after the change becomes 
effective.
    (h) Disclosures of baggage fees on e-ticket confirmations. A U.S. 
carrier, a foreign air carrier, an agent of either, or a ticket agent 
that advertises or sells air transportation in the United States, must 
include information regarding the passenger's free baggage allowance 
and/or the applicable fee for a carry-on bag and the first and second 
checked bag on all e-ticket confirmations for air transportation 
within, to or from the United States. The requirement in this paragraph 
(h) applies to all tickets sold on a website marketed to U.S. consumers 
where the carrier or agent advertises or sells such air transportation, 
including the summary page at the completion of an online purchase and 
a post-purchase email confirmation.
    (1) Carriers must provide this information in the e-ticket 
confirmation. Ticket agents may provide this information in text form 
in the e-ticket confirmations or through a hyperlink to the specific 
location on airline websites or their own website where this 
information is displayed.
    (2) The fee information provided for a carry-on bag and the first 
and second checked bag must be expressed as specific charges taking 
into account any passenger-specific factors that affect those charges.
    (i) Website disclosure of all ancillary service fees. If a U.S. or 
foreign air carrier has a website marketed to U.S. consumers where it 
advertises or sells air transportation, the carrier must prominently 
disclose on its website information on ancillary service fees available 
to a passenger purchasing air transportation. Such disclosure must be 
clear, with a conspicuous link from the carrier's homepage directly to 
a page or a place on a page where all such ancillary services and 
related fees are disclosed. In general, fees for particular services 
may be expressed as a range; however, baggage fees must be expressed as 
specific charges taking into account any factors (e.g., frequent flyer 
status, early purchase) that affect those charges.
    (j) Fee information distribution to ticket agents. (1) For air 
transportation within, to, or from the United States, each U.S. and 
foreign air carrier that provides fare, schedule, and availability 
information to ticket agents to sell or display the carrier's flights 
directly to consumers, must provide such ticket agents useable, 
current, and accurate information of the fee rules for a first checked 
bag, a second checked bag, one

[[Page 63738]]

carry-on bag, canceling a reservation, and changing a reservation. The 
information provided by the carrier must be sufficient to enable the 
ticket agent to comply with the baggage disclosure requirements in 
paragraph (b) of this section and the change and cancellation 
disclosure requirements in paragraph (c) of this section. Carriers have 
no obligation to ensure that these fees are transactable by ticket 
agents; and
    (2) For air transportation within, to, or from the United States, 
each U.S. and foreign air carrier that provides fare, schedule, and 
availability information to ticket agents to sell or display the 
carrier's flights directly to consumers must provide such ticket agents 
useable, current, and accurate information of the fee rules for 
aircraft seats if the carrier charges a fee for a child, who is age 13 
or under on the date an applicable flight is scheduled to occur, to be 
seated in a seat adjacent to the seat of an accompanying adult. The 
aircraft seat fee information must be detailed enough to enable the 
ticket agent to disclose the applicable fees for adjacent seats for 
each flight in the itinerary of a child, who is age 13 or under on the 
date an applicable flight is scheduled to occur, as set forth in 
paragraph (e) of this section. Carriers must ensure that seat fees are 
transactable by ticket agents.
    (k) Unfair and Deceptive Practice. The Department considers the 
failure to provide and adhere to the disclosures required by this 
section to be an unfair and deceptive practice within the meaning of 49 
U.S.C. 41712. The Department also considers the practice of collecting 
a fee from consumers for critical ancillary services (i.e., first and 
second checked bags, one carry-on item, canceling or changing a 
reservation, adjacent seats when traveling with a child who is 13 years 
of age or under) without disclosure of this fee when fare and schedule 
information is provided to be an unfair and deceptive practice in 
violation of 49 U.S.C. 41712. Any fee that has been collected from 
consumers for critical ancillary services must be refunded to consumers 
by the seller of the air transportation if disclosures required by this 
section were not provided.
0
5. Revise Sec.  399.88(a) to read as follows:

Sec.  399.88  Prohibition on post-purchase price increase.

    (a) It is an unfair and deceptive practice within the meaning of 49 
U.S.C. 41712 for any seller of scheduled air transportation within, to 
or from the United States, or of a tour (i.e., a combination of air 
transportation and ground or cruise accommodations), or tour component 
(e.g., a hotel stay) that includes scheduled air transportation within, 
to or from the United States, to increase the ticket price of that air 
transportation, tour or tour component or to apply revised price rules 
for a first checked bag, a second checked bag, and one carry-on bag to 
a consumer, after the air transportation has been purchased by the 
consumer, except in the case of an increase in a government-imposed tax 
or fee. A purchase is deemed to have occurred when the full amount 
agreed upon has been paid by the consumer.
* * * * *
[FR Doc. 2022-22214 Filed 10-19-22; 8:45 am]
BILLING CODE 4910-9X-P