DOT Issues Guidance on Airline Requirements to Carry Passengers of Bankrupt Airlines
WASHINGTON, Aug. 9 /PRNewswire/ -- The U.S. Department of Transportation
has issued guidance on the statutory requirement that, "to the extent
practicable," airlines carry passengers holding tickets on carriers that cease
service due to insolvency or bankruptcy.
In its notice, the department said that passengers holding valid paper or
electronic tickets from insolvent or bankrupt carriers for a particular route
are entitled, at minimum, to transportation on a space-available basis on any
airline currently serving that route. Airlines may recover costs of providing
the transportation, such as the direct cost of rewriting a ticket and meal
costs. The department does not foresee those costs exceeding $25 each way,
the notice said.
Section 145 of the Aviation and Transportation Security Act, signed into
law on Nov. 19, 2001, requires air carriers to provide service on routes they
operate, to the extent practicable, to passengers who hold tickets for those
routes from carriers who have ceased service.
Following Vanguard Airlines' cessation of service on July 30, there has
been confusion among airlines over their responsibilities under law,
particularly whether they must provide confirmed space on their flights and
the level of administrative fees they could charge for providing alternate
arrangements. Today's notice makes clear the carriers' obligations.
Under section 145, consumers holding Vanguard tickets have until Sept. 28
to arrange alternative transportation on another carrier.
The department noted that passengers who purchased Vanguard tickets using
a credit card are entitled to a refund from their credit card issuer for
service they do not receive. However, if passengers accept the alternative
transportation, they probably would not be eligible for a full refund on their
credit card payment.
The notice is available on the Internet at
http://dms.dot.gov/general/orders/aug02/183624_web.pdf .
Roger
EWROPS