The Transportation Department has finalized regulations to broaden the circumstances in which air passengers have a right to a ticket refund.
The regulations also impose new requirements on airlines to disclose to passengers when they are entitled to a refund. They establish refund requirements for delayed receipt of checked bags and for other ancillaries that don’t end up being delivered.
The new rules dealing with ticket refund notification and requirements take effect Oct. 28.
“Passengers deserve to get their money back when an airline owes them — without headaches or haggling,” DOT Secretary Pete Buttigieg said. “Our new rule sets a new standard to require airlines to promptly provide cash refunds to their passengers.”
Airlines are currently required to provide refunds when requested for flights they cancel or “significantly delay.”
However, there had been no DOT definition of a significant delay. Now there will be. Domestic flights delayed by more than three hours will trigger a refund requirement and international flights delayed by more than six hours will do the same.
Flyers whose itineraries are moved forward by three or six hours also will be entitled to a refund should they choose not to travel. In addition, the new regulations stipulate several other itinerary changes that will entitle airline customers to a refund. They include changes to the arrival or departure airport, the addition of a connection point to the itinerary, cases in which the customer is downgraded to a lower seating class, and when an aircraft change downgrades the plane’s available amenities.
Baggage delayed by more than 12 hours on domestic flights will also trigger refund requirements, as will baggage delayed by more than 15 or 30 hours on international flights, depending on the length of the flight.
Under current rules, airlines aren’t required to proactively inform customers on canceled flights that they are entitled to refunds. In practice, that has allowed airlines to issue credits to flyers who were unaware of their rights.
With the new regulations, carriers will be required to inform customers when they have a right to a refund prior to offering a ticket credit, alternative itinerary or other form of compensation.
When the DOT initially proposed the refund rules in 2022, it gave travel agencies equal responsibility for making refund payments, even when the agency didn’t possess the money.
The final rule only puts the onus for providing a refund onto a travel agency if it is the merchant of record for the transaction, which is rare.
Final rule on airline fee disclosure
The Biden administration also announced a final rule to protect airline passengers from surprise fees when purchasing a ticket.
The rule requires airlines and ticket agents to tell consumers upfront what fees they charge for a first or second checked bag, a carry-on bag and for canceling or changing a reservation.
Corporate travel agents, however, are excluded from the
rule. In making that decision, the DOT sided with travel management companies, ASTA and other parties
that argued for the exclusion because ancillary fee disclosures by those agents
are the subject of contractual agreement between a business client and the
travel agency.
Correction: The new rules dealing with ticket refund notification and requirements take effect Oct. 28.
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