In a move to enhance consumer protection within the airline industry, the Biden administration has enacted new regulations requiring airlines to automatically issue cash refunds for significant flight delays and cancellations, as well as to fully disclose all fees upfront.
Under the updated regulations, airlines are obligated to provide automatic cash refunds within a few days for canceled flights and “significant” delays. Notably, the definition of “significant delay” has been standardized to a minimum of three hours for domestic flights and six hours for international flights, eliminating the previous ambiguity. While airlines retain the option to offer alternative flights or travel credits, consumers hold the right to reject these.
Furthermore, the regulations mandate refunds for checked baggage fees in instances where luggage is not delivered within specified time frames: 12 hours for domestic flights and 15 to 30 hours for international flights. This also applies to ancillary fees for services such as seat selection or internet connectivity, provided the airline fails to deliver on these offerings.
The impetus for these new regulations stems from a surge in refund-related complaints during the COVID-19 pandemic, driven by widespread flight cancellations and safety concerns among travelers. Despite the recent decline in refund complaints, the administration maintains its stance on protecting consumer rights.
In a separate but related move, the Transportation Department has also implemented new rules requiring airlines and ticket agents to disclose upfront the charges associated with checked and carry-on baggage, as well as cancellation or change fees. These fees must be clearly displayed on airline websites as soon as customers access pricing and schedules.
Additionally, airlines are obligated to inform passengers that they hold a guaranteed seat for which they are not required to pay extra. However, the regulations do not prohibit airlines from charging for specific seat preferences, a practice commonly employed to generate additional revenue.
The new rules, which are expected to save consumers over $500 million annually, are part of the Biden administration’s broader focus on eliminating “junk fees.” The administration believes that these fees represent an unfair burden on consumers and has pledged to address them across various industries.
