EC Adopts CRS Conduct Code

The European Commission last week adopted a new computer reservation code of conduct that frees airlines and global distribution systems to negotiate content and fee structures. However, some critics said the commission neglected to adequately address its "parent carrier" interpretation, and the code would give Amadeus and its airline stakeholders a preferred position in some European markets.

Though the commission maintained its definition of "parent carrier" to mean airlines that "directly or indirectly, alone or jointly with others, own or effectively control a system vendor, as well as any air carrier or rail-transport operator which it owns or effectively controls," commission officials last week said the definition does not apply to Amadeus, of which Air France/KLM, Lufthansa and Iberia own stakes of 23.6 percent, 11.5 percent and 11.7 percent, respectively.

"We drew the conclusion that even a partial ownership of an air carrier on a CRS was not sufficient to establish that this was a parent carrier in the meaning of the regulation," said Benoît Le Bret, head of cabinet for the European Commissioner for Transport. The code now moves to the European Parliament for final approval, for which there is no timetable.

The Coalition for Fair Access to Reservations in Europe executive director Brandon Mitchener said, "At face value, it has everything we've been asking for for three years." However, C-FARE, an alliance that includes travel companies, buyers, agencies and Amadeus competitors Galileo and Sabre, said the revised code's interpretation would give Amadeus and its airline owners "a regulatory green light to consolidate existing dominant positions, restrict access to critical information on their services and engage in other unfair competitive practices to the detriment of consumers and other market participants."

However, commission officials said the revised code "maintains safeguards to protect against competitive abuse by airlines that own or control CRSs" and "contains provisions to ensure an unbiased presentation of travel options in the CRS displays and the display of 'all-inclusive' airfares."

Business Travel Coalition chairman Kevin Mitchell last week said the commission "opened a giant loophole in the coverage of these rules." C-FARE said if airlines that have a stake in Amadeus "could provide more timely fare and seat availability information to Amadeus than to competing systems," while Amadeus could provide those carriers "privileged access to technology for the display and sale of transportation."