Newstrack

TAAI, TAFI issue notice to all Gulf carriers from India

Reason: Sudden unilateral drop in commissions from 7% to 5%

Reema Sisodia - Mumbai

The Travel Agents Association of India (TAAI) along with Travel Agents Federation of India (TAFI) was, at the time of going to print, on the brink of issuing a notice to all Gulf carriers in India as they have taken a sudden decision to reduce airline commissions from the existing seven per cent to five per cent, effective May 1, 2007.

This decision was reportedly communicated to a few agents over e-mail barely a week before the date of implementation. If the associations do not get a satisfactory response from the airlines concerned, they will jointly issue a legal notice.

Says C V Prasad, president of TAAI, "Our decision to send them a legal notice is based on the fact that it is a restrictive trade practice." He goes on to explain, "The passenger agents handbook resolution 810i clearly states that any change in the commission structure should be made `well in advance'. As per legal advice, a fixed date could not be made mandatory but it was clearly mentioned during the Passenger Agency Conference meeting in the year 2000 that a 90 day notice period is recommended. Our question is if the airline wants to reduce the commission then why do it in such haste taking the agent's fraternity by surprise. In fact, most of our members have not even been informed about the sudden decision and this e-mail has reached only few members in the trade. Under the Passenger Sales Agency Agreement they have to send any notice of change to the principal office of the agent, which has to be backed by proof of either having dispatched or delivered it to their office. This has not been done."

He also feels that keeping the Indian business circumstances in mind, a 120-day notice period should be followed, especially in such circumstances. Supporting his view is Praveen Chugh, president of TAFI, who says, "TAFI and TAAI are jointly sending the notice to the Gulf carriers and if they do not give us a satisfactory reply, then we will issue a legal notice against them." However, the notice had not reached the airlines while going into print.