IATA Lifting Restrictions On European Cross-Border Transactions

The International Air Transport Association has announced a first series of reforms aimed at improving the management of travel programs across Europe. The measures come at a time of increasing pressure from the European Commission, plus corporate buyer and agency lobbying groups, to scrap the national structures which prevent air tickets being bought and sold as a single entity within Europe. The Commission has told IATA it is likely to end the association's "negative clearance"--immunity from prosecution for operating as a cartel--next May.

IATA has started work on the Commission's three main grievances: pan-European accreditation for multinational travel agencies, a pan-European billing and settlement plan (the equivalent of ARC in the United States) and the lifting of restrictions on cross-border satellite ticket printing within the European Union. IATA hopes to start consultations with agencies next week on accreditation and has committed itself to a BSP for Euro-zone countries within four years. IATA on Jan. 1 also will drop all restrictions on E.U. STPs, such as not allowing the ticketing of journeys that originate in a different country from the STP.

Corporate and agency critics of IATA welcomed the moves as important first steps but want the pace of reform to accelerate. "This is a very positive start, but I don't think the story is anywhere near over yet," said Ian Nurdin, deputy chairman of the Institute of Travel Management of the U.K. & Ireland, the lead association for the Paragon alliance of travel management associations. Bernard Harrop, director of industry affairs for American Express, said: "We should be able to book, fulfill and settle anywhere within Europe. That is where the major savings are. If the IATA agreement is to continue to have immunity, it needs to be fair and equitable."