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DOT Issues Guidance on Use of the Term “Free” in Air Fare Advertisements and Disclosure of Consumer Costs in Award Travel

Patrick R. Rizzi

Patrick R. Rizzi,

Washington, D.C.

25 May 2012
The U.S. DOT this week issued guidance related to the use of the term "free" in air fare advertising and the disclosure of costs associated with award travel.  DOT Guidance Free.  The DOT is giving entities covered by this guidance sixty days to modify their promotional material in accordance with this guidance.
DOT Issues Guidance on Use of the Term “Free” in Air Fare Advertisements and Disclosure of Consumer Costs in Award Travel

The DOT announced that it is interpreting the “new” full fare price rule as proscribing advertising a fare as “free” if the fare does not include all government imposed taxes and fees as well as mandatory carrier-imposed charges.  If a carrier advertises an air fare as “free,” then the carrier cannot assess the consumer any monetary charge when the consumer attempts to obtain the “free” travel.  Advertisements relating to mileage awards may not, for example, state or imply that a given mileage amount may be exchanged for a free ticket in a specific market unless the award actually does allow the consumer to travel without any financial cost. . . .”

The DOT further stated that:

Government fees and taxes collected in connection with frequent-flyer award travel can be substantial, and a failure to properly disclose them may be highly deceptive to consumers. . . .

If there are government fees or taxes or mandatory carrier charges such as processing fees that must be paid by consumers in frequent-flyer awards programs, then the respective amounts or a range of those amounts must be shown on carrier websites together with the mileage award levels.” 

By way of example, “a carrier or agent may advertise that a certain amount of award miles is enough for a domestic or international flight with at least the minimum amount of government taxes and fees and mandatory carrier imposed fees that could apply to that itinerary.”  These fees, taxes, and mandatory carrier charges, however, must be given the same prominence as the mileage award requirements.   

Patrick R. Rizzi

Patrick R. Rizzi,

Washington, D.C.

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