[Federal Register Volume 69, Number 183 (Wednesday, September 22, 2004)]
[Rules and Regulations]
[Pages 56692-56693]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-21247]


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DEPARTMENT OF TRANSPORTATION

Office of the Secretary

14 CFR Part 254

RIN 2105-AD42


Passenger Baggage Liability

AGENCY: Department of Transportation (DOT), Office of the Secretary 
(OST)

ACTION: Final rule.

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SUMMARY: In accordance with the provisions of 14 CFR 254.6, this final 
rule revises the minimum limit on domestic baggage liability applicable 
to air carriers to reflect inflation since December 1999, the date of 
the most recent revision to the rule. Section 254.6 requires that the 
Department revise periodically the limit to reflect any changes in the 
Consumer Price Index during the interim. The rule adjusts the minimum 
limit of liability from the current amount of $2,500 to $2,800, taking 
into account the changes in price level over a period of approximately 
four years.

DATES: Effective Date: This rule is effective on October 22, 2004.

FOR FURTHER INFORMATION CONTACT: Nicholas Lowry, Senior Attorney, 
Office of Aviation Enforcement and Proceedings (C-70), Department of 
Transportation, 400 Seventh St., SW., Washington, DC 20590; (202) 366-
9351.

SUPPLEMENTARY INFORMATION:

I. Background

    Part 254 of the Department's rules, 14 CFR part 254, establishes 
minimum baggage liability limits applicable to domestic air service, 
currently $2,500 per passenger. Provisions of 14 CFR 254.6 require that 
the Department periodically review the minimum limit of liability 
prescribed in part 254 in light of changes in the Consumer Price Index 
for Urban Consumers and directs the Department to revise the limit of 
liability to reflect changes in the price index that have occurred in 
the interim. Section 254.6 prescribes the use of a specific formula to 
calculate the revised minimum liability amount when making these 
periodic adjustments. Applying the formula to changes occurring between 
December 1999 and July 2004, the appropriate inflation adjustment is 
$2,500 x 189.4/168.3, or $2,813.42. The provision requires us to round 
the adjustment to the nearest $100, or to $2,800.

II. Waiver of Rulemaking Procedural Requirements

    With this final rule, we are waiving the usual notice of proposed 
rulemaking and public comment procedures set forth in the 
Administrative Procedure Act (APA) (5 U.S.C. 553). The APA allows 
agencies to dispense with such procedures on finding of good cause when 
they are impracticable, unnecessary or contrary to the public interest. 
We have determined that under 5 U.S.C. 553(b)(3)(B) good cause exists 
for dispensing with the notice of proposed rulemaking and public 
comment procedures for this rule. This rulemaking is required by the 
terms of 14 CFR 254.6, as most recently amended in December 1999 (64 FR 
70575, December 17, 1999). Accordingly, we believe prior comment is 
unnecessary and contrary to the public interest, and we are issuing 
this revision as a final rule.
    Although this final rule will become effective in 30 days, the 
Department will defer enforcement of the notice provision in the 
revised rule, as it pertains to written notice of the new limit, for a 
reasonable period to allow carriers to replace or correct their current 
paper ticket stock and envelopes so as to provide proper written notice 
of the increased minimum liability limit without imposing an undue 
burden. Carriers are, however, subject to enforcement action from the 
date of issuance of this final rule if they otherwise fail to provide 
proper notice of the $2,800 liability limit or fail to apply the new 
limit, as appropriate.

[[Page 56693]]

III. Regulatory Impact Statement

Executive Order 12866

    This final rule has been evaluated in accordance with the existing 
policies and procedures and is considered not significant under both 
Executive Order 12866 and DOT Regulatory Policies and Procedures. The 
rule is exempt from review by the Office of Management and Budget (OMB) 
in accordance with the provisions of Executive Order 12866, because its 
provisions are required by current regulatory language, without 
interpretation.

Regulatory Flexibility Act

    The Regulatory Flexibility Act of 1980 (5 U.S.C. 601-612) requires 
an assessment of the impact of the proposed and final rule on small 
entities unless the agency certifies that the proposed regulation will 
have no significant economic impact on small entities. This revision of 
14 CFR part 254 provides for a minimal increase in the amount of the 
minimum baggage liability limit that air carriers may incur in cases of 
lost or damaged baggage. It will pose minor additional costs only in 
those instances in which carriers lose or damage baggage, or delay 
delivering baggage to the traveler, and it affects only carriers 
operating large aircraft or those small carriers interlining with such 
carriers. As a result, many operations of small entities, such as air 
taxis and commuter air carriers, are not covered by the rule. 
Accordingly, we certify that this action will not have a significant 
economic impact on a substantial number of small entities.

Paperwork Reduction Act

    This final rule imposes no new reporting or recordkeeping 
requirements necessitating clearance by OMB.

List of Subjects in 14 CFR Part 254

    Administrative practice and procedure, Air carriers, Consumer 
protection, Department of Transportation.

0
Accordingly, the Department of Transportation revises 14 CFR part 254, 
Domestic Baggage Liability, to read as follows:
0
1. The authority citation continues to read as follows:

    Authority: 49 U.S.C. 40113, 41501, 41501, 41504, 41510, 41702 
and 41707.

0
2. Section 254.4 is revised to read as follows:


Sec.  254.4  Carrier liability.

    On any flight segment using large aircraft, or on any flight 
segment that is included on the same ticket as another flight segment 
that uses large aircraft, an air carrier shall not limit its liability 
for provable direct or consequential damages resulting from the 
disappearance of, damage to, or delay in delivery of a passenger's 
personal property, including baggage, in its custody to an amount less 
than $2,800 for each passenger.

0
3. Section 254.5 is revised to read as follows:


Sec.  254.5  Notice requirement.

    In any flight segment using large aircraft, or on any flight 
segment that is included on the same ticket as another flight segment 
that uses large aircraft, an air carrier shall provide to passengers, 
by conspicuous written material included on or with its ticket, either:
    (a) Notice of any monetary limitation on its baggage liability to 
passengers; or
    (b) The following notice: ``Federal rules require any limit on an 
airline's baggage liability to be at least $2,800 per passenger.''

    Issued in Washington, DC on September 8, 2004.
Norman Y. Mineta,
Secretary of Transportation.
[FR Doc. 04-21247 Filed 9-21-04; 8:45 am]
BILLING CODE 4910-62-P