European Commissioner for Consumers
Dear Commissioner Kuneva,
We the undersigned travel industry consumers and representatives write to express our deep concerns regarding the current revision of the computer reservation system (CRS) Code of Conduct.
You will be aware that Parliament voted on 4th September 2008 to amend the computer reservation system (CRS) Code of Conduct as part of a compromise with the French Presidency. Given the significance of this legislation for consumers, and the wider travel industry, we have serious concerns about its effectiveness.
We would like to request a meeting with you to discuss which airlines will be considered “parent carriers” and thus, obligated under the revised Code’s restrictions on abusive parent carrier behavior.
As you know, parent carriers are forbidden from restricting the flow of air and rail fare information and booking functionality to competitive distribution services. These restrictions are necessary because of the historical fact that airlines that own or control CRSs have the means and the incentive to undermine airline, rail and distribution competition to the detriment of consumers. The recently missed opportunity to bring legislative clarity to the Code is positive proof of how the interests of 380 million European consumers can be undermined.
Despite the fact that Parliament’s Transport Committee overwhelmingly approved a set of amendments on 29 May 2008 providing a clear definition of parent carrier, a flawed plenary amendment was tabled as a result of a compromise with the French Presidency. Consumer groups actively sought clarification of this amended parent carrier definition due to the insertion of a dangerously ambiguous “decisive influence” test for parent carrier status. A large number of MEPs were concerned that this insertion rendered the code ineffective, and voted to delete the problematic decisive influence text in order to safeguard consumers. Unfortunately they lost a razor-thin vote (305 to 291) to remove this language from the legislation.
Europe’s consumers now look to DG TREN and DG SANCO to cooperate closely and bring forth an interpretative notice on the definition of parent carrier as promised by the European Commission during the recent plenary. This notice should serve to protect consumers’ interests by interpreting 'decisive influence' to make it clear that the right to designate one or more representatives on the board of the system vendor will be regarded as “conferring the possibility of exercising alone or jointly with others, decisive influence” over that system vendor. Indeed, by definition the directors of an undertaking together with the other directors decisively control any undertaking, so we do not see how the outcome of the interpretative exercise could, in fairness, reach any other result.
Assuring transparency is the only way to avoid regulation that works against consumer interests. The Commission has worked hard through its online ticketing investigations to provide price transparency for the purchase of airline tickets. Full disclosure of all airfare charges and fees codified in this CRS regulation is rendered meaningless if the consumer does not have visibility to the airfare offering in the first place.
We would be grateful if you could take the time to meet with us, as soon as schedules permit, in order to discuss the issues at stake in a timely manner, and to gain a better understanding of how you intend to proceed with protecting consumer interests. A representative of our group will contact your office to see when a meeting with you might be held.
International Airline Passengers Association
Institute of Travel Management
Danish Business Travel Association
Finnish Business Travel Association
Business Travel Coalition