Feb. 14, 2019
NBAA’s Regulatory Issues Advisory Group (RIAG) has assembled a list of answers to commonly asked questions about the new federal rule for air charter brokers. The rule, which takes effect Feb. 14, establishes a new 14 Code of Federal Regulations (CFR) Part 295, Air Charter Brokers, and revises 14 CFR 298, Exemptions for Air Taxi and Commuter Air Carrier Operations.
The U.S. Department of Transportation developed the rule in response to consumer protection-related recommendations made by the National Transportation Safety Board following accidents in 2005 and 2006 involving brokered flights. While ensuring necessary consumer protections, the regulations give brokers more opportunities to market and offer their services.
The final rule contains five main components:
- Defines “air charter brokers”, and allows them to provide single-entity charter air transportation of passengers as principals or bona fide agents.
- Requires air charter brokers to automatically make certain disclosures to consumers in some cases, and upon request in others.
- Describes certain practices by air charter brokers as prohibited or unfair practices, or unfair methods of competition.
- Requires air taxis and commuter air carriers that sell charter air transportation to make the same disclosures to consumers as air charter brokers.
- Describes certain practices by an air taxi or commuter air carrier as prohibited or unfair practices or unfair methods of competition.
The key issues for business aviation include:
- The rule formally defines air charter brokers, and is applicable not only to those acting as principals but also to bona fide agents of either the air carrier or the passenger.
- Brokers and air carriers must provide certain disclosures to passengers.
- Brokers and air carriers may be required to provide a full refund in the event of a failure to provide required disclosures within a reasonable time period.
- Brokers must clearly and conspicuously state in advertising and marketing materials that they are air charter brokers and not air carriers. However, brokers may display their company name on the aircraft, provided the operating air carrier’s name is also prominently displayed.
RIAG members Adam Hohulin, of Sentient Jet; Dayton Lehman Jr., of Capitol Business Solutions and Jason Maddux, of Garofalo Goerlich & Hainbach PC, compiled the Q&A to help brokers and operators understand the impact of the final rule, which regulates the air charter broker industry for the first time.
The Q&A contains more than two dozen answers to common questions from air carriers, air charter brokers and broker companies that have card and membership products. Review the Q&A.
“We want to thank the RIAG for putting this resource together,” said Brian Koester, senior manager for flight operations and regulations. “We hope it helps the industry by providing clarity to a rule that’s been in the works for more than 10 years.”