Unique Vacations Fined For Violating DOT Price Advertising Rules

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Unique Vacations Fined For Violating DOT Price Advertising Rules By Shane Nolan

		November 15, 2010 - The U.S. Department of Transportation (DOT) assessed a civil penalty against the ticket agent Unique Vacations for violating the Department’s rules for advertising the price of air travel. The company was assessed a civil penalty of $200,000. “When people buy tickets for air travel, they have the right to know how much they will have to pay,” said U.S. Transportation Secretary Ray LaHood. “We will continue to take enforcement action when our price advertising rules are violated.” DOT requires any advertising that includes a price for air transportation or an air tour to state the full price to be paid by the consumer. The only exception is government-imposed taxes and fees that are assessed on a per-passenger basis. Such as passenger facility charges, which may be omitted from the stated fare but must clearly appear in the advertisement so that passengers can determine the full price they must pay. Ticket agents that sell air tour packages are covered by the rules.

The Department’s Aviation Enforcement Office investigated Unique Vacations’ ads and found that they violated DOT’s requirements. The company advertised “free” air fares to certain Caribbean resorts, although the consumer actually would have to pay certain taxes and fees or airline costs such as fuel surcharges. Many of the fares advertised as free involved only a limited dollar credit toward an air fare, with consumers having to pay any additional costs. These ads were published on the Internet and in numerous major newspapers, and were broadcast on television throughout the United States. The “free” fare offer also was published on the website of Sandals Resorts, one of the destinations sold by Unique Vacations. This consent order concerns advertisements by Unique Vacations, Inc., ("Unique Vacations") that were published in print and electronic media for Sandals Resorts that violate the Departments price advertising requirements specified in section 399.84 of the Department's regulations (14 CFR 399.84) and constitute unfair and deceptive trade practices and unfair methods of competition in violation of 49 U.S.C. § 41712. This order directs Unique Vacations to cease and desist from future violations and assesses the company compromise civil penalties of $200,000.

Unique Vacations, as a ticket agent selling air tour packages, is subject to the advertising requirements of Part 399 of the Department's rules. Under 14 CFR 399.84, any advertising that states a price for air transportation or an air tour is considered to be an unfair or deceptive practice in violation of 49 U.S.C. § 41712 unless the price stated is the entire price to be paid by the customer to the air carrier or ticket agent for such air transportation, tour or tour component.

However, as a matter of enforcement policy, the Department has permitted air carriers and ticket agents to state separately from the advertised price taxes and fees imposed by a government on a per-passenger basis, such as passenger facility charges, so long as their amounts appear or are indicated clearly in the advertisement so that the consumer can determine the full price to be paid.

Taxes and fees imposed on an ad valorem basis, however, must be included in the advertised price. Carrier- or agent-imposed surcharges, e.g., fuel, insurance, and service charges, or other such costs, must be included in the advertised price. With respect to air fares and air tours advertised on the Internet, taxes and fees that are permitted to be excluded from the advertised price may be noted in a prominent link, placed proximately to the stated price, that takes the viewer to the bottom of the screen, or to a place on a separate screen, where the nature and amount of such fees are displayed.

Unique Vacations specializes in offering travel packages, which include air fare, hotel, guided tours, and related amenities, particularly to Sandals and Beaches resorts in the Caribbean, including Jamaica, St. Lucia, Antigua and The Bahamas. Unique Vacations has promoted its air travel packages through printed advertisements in newspapers such as The New York Times, trade magazines, television, flyers and other mailers, outdoor advertising, and by means of advertisements that are published on various online sites, including its web site.

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