Corporate Securities Info

Truth in airline promos

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Last Monday, the Department of Transportation and Communications and Department of Trade and Industry issued Joint DOTC-DTI Administrative Order No. 01, or the Air Passenger Bill of Rights.

An offshoot of numerous complaints about unsatisfactory airline service, the order spells out, among others, the rights air passengers are entitled to once they pay for their tickets and the obligations airline operators must perform to make sure the passengers get the services they paid for.

The order enumerates the procedures that airline operators should observe from the advertisement of their flight schedules to passenger check-in to boarding and, in case of flight overbooking, delays or cancellation, the grant or payment of certain benefits or compensation to the affected passengers.

Not all the cards are, however, stacked against the airline companies. The passengers’ rights are matched by their obligation to check in on time, comply with the fine print of their tickets, and follow applicable security and health regulations.

The order applies to all Philippine-based carriers that operate scheduled and non-scheduled domestic and/or international flights, and foreign carriers that maintain scheduled or non-scheduled international flights from the Philippines.

Promotions

Among the provisions of the order that recent converts to airline travel can relate to is the pricing of airline seats particularly at the economy section.

Prior to the liberalization of domestic air travel in the country, which saw the influx of low-cost (or budget) airlines, ticket prices for different airplane seat configurations were fixed in advance.

Airline ticket counters and travel agencies had printed price lists at hand which they consulted whenever passengers asked for quotations. Changes in prices were expected only in foreign travels where the fares were determined based on the prevailing exchange rate between the US dollar and Philippine peso.

Not anymore. Today, ticket fares are determined on a daily basis. The cost of travel arrangements made, say, six months before the trip is often cheaper than when made two days before the planned trip.

If the airline has a promotional (or promo) program, the ticket price could go down to as low as P1, exclusive of government fees, taxes and fuel surcharge, if any.

But availing yourself of this discounted ticket price is not easy. The passenger has to make the reservation by telephone as soon as the promo starts, usually at 12 midnight of a particular day, and payment has to be made through certain credit cards only.

To enjoy the low-fare promo, the passenger has to compete with hundreds of other passengers or travel agents for access to the airline’s computerized telephone reservation system.

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The order lays down strict rules on the advertisement of fares to protect the public from misleading information.

Airlines are required to disclose in full and in easy to understand language the major conditions or restrictions, such as rebooking or refund of fares, that may be attached to certain types of fares.

This way, the passenger gets to know ahead of time the consequences of buying those tickets and the effects of their failure to use them on the designated date and time.

The advertisements on these fares should also contain, among others, the baggage allowance rules, government taxes and fuel surcharges, and other fees and charges that the passenger is required to pay.

In other words, the passenger should know exactly how much he has to shell out to be able to travel on his chosen ticket fare. This will do away with the practice of some airlines of advertising low ticket prices only to require the passenger to pay additional fees and charges when he checks-in at the airport.

The rules are stricter for promotional fares. In addition to the earlier mentioned disclosure requirements, the airline is obliged to indicate the number of seats offered on a per-sector basis, the duration of the promo and the approval by the Civil Aeronautics Board of such fare offering.

Practices

Apparently wise to the ways of advertisers in circumventing disclosure requirements, the order states that this information should occupy not less than one-third of the advertising material and, more importantly, printed on or attached to the ticket in English and Filipino.

In case the advertisement is done through the broadcast media, it is sufficient that the information is made by reference, i.e., announced that they can be read in the airline company’s website or the proper documents can be sent upon request to the passenger concerned.

If followed strictly, this scheme works to the advantage of the airline. Having been put on notice about the conditions and restrictions of the ticket fare chosen, a passenger cannot later be heard to complain that he was deluded or misled into buying his ticket.

It is not only in the advertisement of ticket fares that strict disclosure rules have been imposed. The order also provides that all sales promotion campaigns and activities of airline companies should be carried out with honesty, transparency and fairness, and in accordance with the Consumer Act of the Philippines.

The order will take effect on Dec. 21 when airline travel is at its heaviest because of the coming holiday season.

Only time will tell whether the order will be strictly enforced or join the ranks of government rules and regulations that are long on intentions but short on performance.

For comments, send your e-mail to rpalabrica@inquirer.com.ph.

Disclaimer: The comments uploaded on this site do not necessarily represent or reflect the views of management and owner of INQUIRER.net. We reserve the right to exclude comments that we deem to be inconsistent with our editorial standards.

  • Pakinaskungtaeb

    Piso fares are good but has the worst effect in defeating competition with other modes of  transportation. Land and water transportation services with regulated fares will be wiped out by airlines’ PISO fares.  But as soon as competitors are gone and travelers have no other alternative mode to chose from, airline’s got it all laughing all the way to the bank. Regulators should set up minimum fares to prevent this abusive practices.    
     

  • https://me.yahoo.com/a/hbRkpPw1oYTBJamz.EH7acMZBBVoIlWXriA-#e4348 Felix

    “Only time will tell whether the order will be strictly enforced or join the ranks of government rules and regulations that are long on intentions but short on performance.”

    yes to the above quoted statement.

    Where to file complaints? Any specified number of days for resolving complaints?

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