IN A bold move, the European
Travel Agents’ and Tour Operators’
Association (ECTAA) has filed an
antitrust complaint against Iata with
the European Competition Authority.
The association has asked
the Commission to investigate
infringements of competition rules
caused by Iata’s Passenger Agency
Programme (PAP). This follows years
of failed negotiations with Iata to
modernise the agency distribution
programme, ECTAA says.
The commercial relationship
between travel agents and airlines
has evolved and is no longer
an agent-principal relationship,
says ECTAA. Airlines now directly
compete with travel agents on the
distribution of air tickets, while
the classical commission-based
remuneration schemes have been
abandoned.
It argues that, despite this,
airlines are still imposing strict,
unilateral and disproportionate
contractual constraints on travel
agents for the distribution of
tickets. These are enforced through
PAP, which was developed 40 years
ago. According to ECTAA, PAP is
no longer in line with economic
realities.
“Travel agents have no say in
decision-making whatsoever and are
powerless when it comes to setting
the rules. The governance body of
PAP consists of airlines only, which
unilaterally decide the programme
rules,” the association said in a
release.
The association also lists Iata’s
New Generation ISS programme
as a concern, explaining that its
introduction of a cap on agents’
sales is forcing agents to prefinance sales once a certain
threshold has been reached. It also
says that PAP requires agents to
provide bigger and more frequent
financial guarantees.
“Indirect distribution of air tickets
is dangerously hurt by the abuse
of Iata’s dominant position, while
it is needed more than ever to
help consumers navigate through
a jungle of complex ticket offers,
including a growing number of
ancillary services,” says Pawel
Niewiadomski, president of ECTAA.
“Iata has not seen the ECTAA
complaint to the EC. However,
based on ECTAA’s news release and
public statements, we believe that
its claims are without merit and
we intend to defend our position
vigorously,” says Iata.
“We share the concerns raised
by ECTAA but through our affiliation
with the WTAAA, Asata has taken
the position to participate in
discussions with Iata around
reviewing the governance of
the agency programme. We will
continue to closely monitor these
discussions with Iata and the
actions taken by ECTAA,” says Otto
de Vries, Asata ceo.
