|
I
write this column after a gap of nearly two months on the
eve of the first anniversary of 9/11 and the temptation to
write about its ‘terr(or)ific’ impact on the airline
business is too strong. But the temptation to write about
the airline and travel agent (TA) relationship has proved
stronger - for three reasons. The prime mover is the statement
issued by UFTAA (Universal Federation of Travel Agents Associations)
Board of Directors at Paris on August 10, which is the first
ever public repudiation of the IATA Passenger Sales Agency
Programme. Secondly, the 51st congress of TAAI, which is the
sole representative of Indian TAs on the UFTAA board, is due
to meet in another ten days; and, it has deemed it proper
to circulate a copy of this statement to all its members in
advance. Thirdly, I score a brownie point for having forecast
this eventuality in this column more than once. The analogy
of serving a meal is illustrative of the dynamic change that
has taken place in the business of serving the airline customer
with a fare quote and issuing the airline ticket. Not too
long ago it used to be a ‘set’ meal, where the fare
was fixed by IATA and the ticket could only be issued through
an IATA accredited TA who received a ‘set’ commission
as remuneration. An unwritten code of ethics ordained that
airlines will not issue a ticket directly because that amounted
to a denial of the commission to the TA: it was 9 per cent
when last heard of and is now ‘a la carte’! So are
the air fares and mode of ticketing, which have given the
customer a choice so wide that it has turned the airline/TA
relationship on its head, making IATA virtually extinct? If
official acknowledgement is needed then the Paris statement
provides it in full measure.
The background to the Paris statement is that the latest IATA
Passenger Agency Conference (PAConf) held at Miami on June
26, refused to endorse the draft agreement prepared by a high
powered Global Consultative Committee comprising of airlines
(nominated by IATA) and TA representatives, after four years
of deliberations. The agreement sought to uphold the ‘principal-agent’
relationship that was more just and balanced. Irked by this
refusal, the UFTAA board has called upon its member associations
to take following courses of action.
-
To suspend participation in dialogue committees with IATA
like APJC and other joint working groups.
-
To consider alternative airline reporting and payment systems,
like the BSP, questioning the one-sided protection given
to airlines against TA defaults and the justification of
paying IATA accreditation fees amounting to US$ 12-15 million.
-
To request appropriate national authorities to review legislation
that gives anti-trust immunity, or equivalent, to airlines
and IATA.
-
To support legal action for defending TAs contractual rights,
under clause 9 of IATA resolution 824, to receive remuneration
by way of commission.
It is interesting to note that in the USA too this subject
is live and a national commission was created on May 16 ‘to
study the role of TAs in the airline distribution system and
determine if impediments exist that block consumer access
to airline fares and schedules information’. Of course
TAs commissions have already been abolished in that country
and whether this body will look into this matter is anybody’s
guess but we will know by November 16, when its report is
due. We will also know by the end of the TAAI congress how
serious that body is in carrying forward this agenda in a
role that is quite unfamiliar to its leadership. One thing
is for sure. This column has come alive on an issue that was
given up as a dead loss. So, watch this space!
|
