ADMs issued relating to the rate of exchange used in refund calculations are causing confusion, with agents unsure whether to issue refunds based on Iata resolution calculation instructions or based on some airlines’ conflicting ruling instructions.
An amendment to Iata resolution 024k, which came into effect in April 2017, stipulated that refunds must be calculated using the Iata rate of exchange (ROE) for the currency in which the amount is denominated on the date of issue of the original ticket. Previously, agents calculated values using the ROE available on the date that the refund was issued.
A source from a consortium’s BSP department told eTNW that it calculated refunds based on the ROE used on the date of issue of the original ticket, as per the correct application of the amended Iata resolution.
However, the consortium has received a few ADMs recently from Air India, where the airline states that, according to its fare rules, refunds must be calculated using the ROE on the date that the refund was issued. The agent explains that this is actually in contravention of the Iata resolution.
“Luckily the ADMs have all been small amounts of around R30 or so based on the difference between the ROE calculation interpretations, and we have now highlighted the Air India interpretation to avoid further instances where we are out of pocket. The majority of other airlines are all complying with the updated Iata resolution calculation however,” said the agent.
Air India had not responded to eTNW at time of publication.
