[Federal Register Volume 67, Number 234 (Thursday, December 5, 2002)]
[Proposed Rules]
[Page 72396]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-30851]


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 Proposed Rules
                                                 Federal Register
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 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
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  Federal Register / Vol. 67, No. 234 / Thursday, December 5, 2002 / 
Proposed Rules  

[[Page 72396]]


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DEPARTMENT OF TRANSPORTATION

Office of the Secretary

14 CFR Part 399

[Docket No. OST-96-1505]
RIN 2105-AB39


Withdrawal of Proposed Rulemaking Action; Statement of 
Enforcement Policy on Rebating

AGENCY: Department of Transportation, Office of the Secretary.

ACTION: Withdrawal of notice of proposed rulemaking.

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SUMMARY: This document withdraws an Office of the Secretary (OST) 
notice of proposed rulemaking (NPRM), which has been superseded by 
various changes that make the proposed action no longer necessary.

FOR FURTHER INFORMATION CONTACT: Jennifer Abdul-Wali, Office of the 
General Counsel, 400 Seventh Street, SW., Washington, DC 20590; (202) 
366-4723; fax: (202) 366-9313; E-mail: [email protected].

ADDRESSES: You may obtain a copy of this document from the DOT public 
docket through the Internet at http://dms.dot.gov, docket number OST-
96-1505. If you do not have access to the Internet, you may obtain a 
copy of the notice by United States mail from the Docket Management 
System, U.S. Department of Transportation, Room PL-401, 400 Seventh 
Street, SW., Washington, DC 20590. You must identify docket number OST-
02-13179 and request a copy of the document entitled ``Withdrawal of 
Proposed Rulemaking Actions.''
    You may also review the public docket in person in the Docket 
office between 9 a.m. and 5 p.m., Monday through Friday, except Federal 
holidays. The Docket office is on the plaza level of the Department of 
Transportation. Additionally, you can also get a copy of this document 
from the Federal Register Web site at http://www.gpo.gov.

SUPPLEMENTARY INFORMATION: Airlines are required by 49 U.S.C. Sec.  
41510, formerly section 403 of the Federal Aviation Act, to file 
tariffs with the Department that state their passenger fares, cargo 
rates, and associated charges in foreign air transportation. Under 
these requirements, it is unlawful for a carrier or ticket agent to 
charge a purchaser of foreign air transportation any amount other than 
that stated in their tariff. This prohibition also applies to cargo 
agents, as well as any other intermediaries providing for the carriage 
of passengers or cargo. The prohibition applies not only to 
overcharges, but also to undercharges, including what are commonly 
known as rebates. For example, a literal reading of the statute would 
prohibit a travel agent from sharing its commission on international 
tickets with the purchaser.
    Subsequent to the enactment of Section 41510, the Airline 
Deregulation Act of 1978 was enacted. It resulted in direct competition 
among air carriers instead of governmental determination of fares and 
services. Following deregulation, the Department and its predecessor, 
the Civil Aeronautics Board, exercised prosecutorial discretion in 
pursuing matters relating to the rebating requirements of the Act. The 
Department's goals were to encourage competition and encourage low 
fares for consumers. As a way of reaching these goals, the Department 
asserted its discretion by pursuing sanctions for rebating only in 
instances of fraud, invidious discrimination, or conduct that would 
violate the antitrust laws.
    On October 21, 1988, the Department issued an NPRM entitled 
``Statement of Enforcement Policy on Rebating'' (OST Docket No. 45884; 
53 FR 41353). The NPRM was in response to concerns raised by travel 
agents concerning the rebating of international airline prices. The 
NPRM proposed to establish an enforcement policy concerning the 
rebating of international airline prices.
    The Department received various comments in response to the NPRM. 
Travel agents complained that, by obeying the law, they were losing 
business to competitors who ignored it. Other nations said that the 
Department should enforce the prohibition against rebating more 
rigorously.
    Since publication of the NPRM, many conditions in the airline 
industry related to rebating have changed. The United States has 
increasingly negotiated with success for liberal pricing regimes in our 
bilateral agreements with foreign nations. As a result, in July of 
1999, the Department adopted 14 CFR part 293, International Passenger 
Transportation, a rule that effectively exempts all United States and 
most foreign carriers (1) from filing any tariffs for travel to and 
from countries with which the United States has agreements in force 
that contain double-disapproval pricing rules and (2) from filing 
tariffs for all but normal economy fares for travel to and from 
countries without double-disapproval pricing regimes that in practice 
give carriers unfettered pricing discretion. Additionally, current 
practice for many air carriers is not to pay a base commission for 
transportation originating in the United States.
    For the reasons outlined above, the Department believes that the 
proposed enforcement policy is no longer necessary and is withdrawing 
the 1988 NPRM.

    Issued in Washington, DC on November 26, 2002.
Norman Y. Mineta,
Secretary of Transportation.
[FR Doc. 02-30851 Filed 12-4-02; 8:45 am]
BILLING CODE 4910-62-P