For travel agents, travails over commission continue

The impasse over payment of commissions to airline travel agents continues. The matter has now been placed before the Union law ministry.
An official from one of the travel agents’ organisations who has been informed by a high-level official from the Directorate General of Civil Aviation (DGCA) said the civil aviation ministry is awaiting a nod from the law ministry on the final assessment.
“The latter will decide whether the DGCA is a competent authority to decide whether it is mandatory for all carriers operating out of India to pay commission to travel agents,” a source said.
Over the last few years, the commission rate paid by carriers to travel agents has steadily come down from a peak of 9-7% to the current 5-3%. While the domestic full-service carriers like Jet Airways, Kingfisher Airlines and Indian offer 3% commission, the low-cost carriers charge a service fee which is not linked to the base fare, but is levied in the form of a flat fee.
While some foreign airlines are offering a 5% commission, about 16-18 companies are working on a zero-commission basis.
However, agents said that Resolution 810i of the International Air Transport Association (IATA) indicates that all travel agents would be remunerated reasonably by airlines.
04/02/10 Madhumita Mookerji/Daily News & Analysis

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Categories: Indian Aviation- In General Feb 2010