The Biden administration announced new rules for airlines on Wednesday aimed at protecting consumers from hidden fees when booking flights and ensuring they receive refunds when flights are delayed or canceled.
The rules could save passengers millions of dollars a year, according to officials.
Under the first regulation announced by the Department of Transportation (DOT), airlines and ticket agents will be required to tell consumers upfront if there are any fees to be paid for a first or second checked bag, or a carry-on bag.
Airlines and ticket agents must also inform customers upfront if they will have to splash out extra to cancel or change their reservations.
Additionally, airlines must let consumers know that seats are guaranteed and that they are not required to pay extra to secure one and provide consumers with the option to receive various discounts based on their participation in the airline’s rewards program, or their military status, among other things.
They must also put an end to what the department called “bait-and-switch tactics”—advertising a promotional discount off a low base fare that does not include all of the extra carrier-imposed fees.
Holding Airlines Accountable
In total, consumers are expected to save over $500 million annually that they are currently overpaying in hidden airline fees, officials said.“Airlines should compete with one another to secure passengers’ business—not to see who can charge the most in surprise fees,” said U.S. Transportation Secretary Pete Buttigieg. “DOT’s new rule will save passengers over half a billion dollars a year in unnecessary or unexpected fees by holding airlines accountable for being transparent with their customers.”
Under a second regulation announced by the White House, airlines will be also required to “automatically” refund passengers in cash “promptly” when their flights are canceled or significantly delayed—more than three hours for domestic flights or six hours for international flights, or if there are significant delays in their baggage returns—as opposed to them having to request it themselves.
Customers must also receive a refund promptly if they are not provided ancillary services, such as Wi-Fi or priority boarding, after purchasing them.
In announcing the new rule, the White House noted that customers must currently navigate a “patchwork of cumbersome processes” when attempting to request and receive a refund, such as searching through an airline’s official website and filling in lots of forms online or waiting on the phone to customer service, sometimes for hours at a time.
“Passengers would also receive a travel credit or voucher by default from many airlines instead of getting their money back, so they could not use their refund to rebook on another airline when their flight was changed or canceled without navigating a cumbersome request process,” the White House said in a press release.
The latest rules will be rolled out within six months to two years, officials said.
President Biden has also vowed to target hidden or junk fees associated with apartment rentals, banking, cable and satellite television, vehicle purchases, and more.
According to the White House, the Biden administration has helped return more than $3 billion in refunds and reimbursements owed to airline passengers since taking office, including more than $600 million to passengers affected by the Southwest Airlines Christmas holiday chaos in 2022.
