With ARC’s proposed settlement plans, agencies will need to spend
more time and expense processing and submitting daily air sales
reports. Apparently, the agency community as a whole is being
penalized by unethical agents who submit fraudulent voids.
And agents though not surprised that these moves were made
because of all the hoopla ARC displayed with its push for IAR
Interactive Plus electronic reporting were obviously angry.
The reason for the move, according to ARC President David
Collins, was due to the “prolonged crisis in the airline industry.”
The airlines, Collins said, need daily reporting to more
effectively monitor their sales, which is done in most other
industries. Under the current weekly reporting requirement, up to
two weeks can pass before carriers receive sales data.
“In this day and age, you need data on your desk the following
day on what went on the day before,” he said.
Collins added: “Although we have truthfully said on a number of
occasions in the past that we had no plans for instituting daily
reporting, that situation has now changed. ...
“We will not be talking about daily remittance, although we will
be looking at the current disparity between the billing of credit
transactions daily and the settlement of cash transactions 10 to 17
ASTA President Richard Copland denounced ARC’s move as
“antiagent and anticonsumer.” He said that when ARC first announced
the Interactive Plus system, the association was the only group to
come out against the plan.
“ASTA plans to take the lead on behalf of the entire travel
agency community in seeing that our united voice is heard on this
issue,” Copland said.
ARTA President John Hawks said ARTA would support any responses
undertaken by ASTA and agency consortiums and franchisors “so that
the travel agency community can speak with a united voice on this
Hawks said that as recently as six months ago, ARC declared that
daily reporting was not in the works.
“Now, we’re hearing the truth: ARC is setting the stage to
require daily remittance and merchant accounts for agents to sell
airline tickets,” Hawks said.
The airlines needing more transaction information on a
day-to-day basis is “laughable,” Hawks said. “There’s not another
industry in the country, aside from Wal Mart, perhaps, with its
inventory systems, that has the same type of daily, almost
up-to-the-minute reporting that they get through the CRS. It’s just
‘Shortening the Void Window’
ARC also intends to clamp down on agencies that report
fraudulent voids, which cost the airlines millions of dollars each
“We are not going to eliminate the void capability,” Collins
said. “We recognize errors take place. What we are talking about
here is shortening the void window.”
Hawks responded that ARC should “take action against any agency
guilty of this type of fraud rather than punishing the entire
“It’s clear that a principal objective of daily reporting is to
remove the ability of travel agents to void tickets issued with the
current reporting period,” said Rees Williams of Carlson Wagonlit
Travel in Sacramento. “This has been an added value that travel
agents could offer clients. It’s true that, under the present
situation, restricted tickets issued to a client who has to change
his travel date could be voided and tickets for the new date issued
without the $100 change fee.
“Travel agents can do this, and surely the airlines would like
to stop this practice.”
David de L’Arbre of American Express/Santa Barbara Travel Bureau
said the proposed reporting changes “will place an unfair burden on
travel agencies to have full time staff available to fulfill the
“ARC reporting already consumes a disproportionate amount of
staff time based upon the revenue earned from the sale of airline
tickets. ARC is now forcing agencies to make a bad situation worse
in order to help suppliers that have abused us for years.”
David Toller of Enterprise Travel in Scottsdale added: “You’re
now talking about multiplying my bookkeeping expenses by five
Hawks said the critical first step has been taken.
“We see it as the next step to going daily remittance,” he said.
“And then, after that, we feel the carriers will try to shift the
merchant account status back to us.”
Meanwhile, Collins said that before the changes are made, a
“dialog [is] being launched” and will take place through the Joint
Advisory Board-Agent Reporting Agreement and the Travel Agent
Working Group. Jerry Chandler contributed to this