Biden Administration Issues Final Rules Enhancing Airline Refund Policies and Fee Disclosures
The Biden Administration has taken a significant step towards protecting airline consumers by issuing final rules that mandate automatic cash refunds for canceled flights and significant delays. These rules also require airlines to provide better disclosures of fees for checked baggage and cancellations.
Automatic Cash Refunds for Canceled Flights and Significant Delays
Under the new regulations, airlines will be required to provide automatic cash refunds within a few days for canceled flights and delays lasting three hours or more for domestic flights and six hours or more for international flights. Previously, airlines held the discretion to determine the duration of delays that would trigger refunds. This ambiguity has now been eliminated, providing clarity and convenience for passengers.
Enhanced Transparency for Fees
To enhance transparency, airlines will be required to disclose upfront any fees associated with checked and carry-on bags, as well as cancellation and reservation changes. These fees must be prominently displayed on airline websites during the initial search for flights and schedules. Additionally, airlines must inform passengers that they are entitled to a guaranteed seat without paying extra, although they may still charge for specific seat preferences.
Estimated Savings for Consumers
The Transportation Department estimates that these new rules will save consumers more than $500 million annually. The increased transparency regarding fees will empower passengers to make informed decisions and avoid hidden charges.
Enforcement and Industry Response
The rules will take effect over the next two years and form part of the Biden Administration’s broader efforts to combat excessive, or ‘junk,’ fees. The Transportation Department has also authorized state officials in 15 states to assist in enforcing federal airline consumer protection laws.
While the airline industry has noted a decline in refund complaints since 2020, the new rules aim to further strengthen consumer protections and ensure fair treatment of passengers.
