NBAA: DOT Confirms Charter Broker Disclosure Timing Requirements

March 30, 2021

The association recently received clarification from the Department of Transportation (DOT) on a Part 295, air charter brokers, disclosure requirement, affirming that an air charter broker may contract with a customer before knowing the identity of the direct air carrier.

Part 295 includes a number of consumer protection elements, including requirements in §295.24(a) to disclose to a customer the name of the direct air carrier prior to contracting for a specific flight. Then, §295.24(b) states any required disclosures in paragraph (a) that are unknown to the broker at the time of contract with the customer may be provided after the information is available to the broker. Under §295.24(c), an air charter broker that fails to comply with the required notices must provide the customer the opportunity to cancel and receive a full refund.

Since §295.24 requires a broker to provide the name of the operator prior to contracting with the customer, NBAA members questioned if a broker could contract with the customer before finding the operator, and disclose the direct air carrier’s identity upon receiving that information.

In a letter to the DOT’s Office of Aviation Consumer Protection, Dayton Lehman Jr., attorney and founder of the Aviation Group at Capitol Business Solutions Inc., and Jason Maddux, attorney at Garofalo Goerlich Hainbach PC, requested the DOT confirm it is permissible under Part 295 for an air charter broker to contract with a charterer and then subsequently contract with a direct air carrier and disclose the air carrier’s identity to the charterer at that time.

View the letter to the DOT. (PDF)

In its review of the request, the DOT said: “For such situations, consistent with the regulation, air charter brokers must disclose to the charterer the identity of the direct air carrier within a reasonable time after the information becomes available, and must provide an adequate opportunity for the charterer to accept the additional information or to cancel the charter contract, including any services in connection with such contract, and receive a full refund of any monies paid for the charter air transportation and services.”

Although this DOT legal opinion is not as formal in presentation as an FAA legal interpretation, Lehman and Maddux said the opinion carries similar weight and indicates enforcement action would not be taken in the above circumstance.