Senate Passes Bill To Aid Fliers of Failed Airlines

October 8, 2004

Senate Passes Bill To Aid Fliers of Failed Airlines
October 8, 2004 – The Senate passed a bill (S. 2845) to help air travelers affected by airline bankruptcy or insolvency. The law was originally passed after 9/11 when Congress feared multiple airline failures, but is scheduled to expire Nov. 19 on this year. The Senate unanimously agreed to extend the rule as part of a larger piece of intelligence legislation. The House now needs to approve the extension.

The bill gives passengers holding tickets from a failed carrier up to 60 days to make arrangements to use them on another airline, on a stand-by basis. The rebooked airline could charge a service fee of no more than $50 per round trip.

Travelers who buy tickets with credit cards can typically get refunds from the credit card company if an airline fails. But those who pay with cash or by a bank debit cards don’t have that protection, says Kevin Mitchell, chairman of the Business Travel Coalition, one of several backers of the law’s extension.

ASTA President Kathryn Sudeikis said it was "essential" for Congress to extended the protections "so that consumers can have at least some assurance that efforts will be made to provide them with transportation in the event that one of these financially distressed carriers were to actually cease operation."