No more ADMs

IATA has been mandated by
member airlines to create
a working group to address
specific travel agent issues,
in particular ADMs, “with
proposals for remedies so
that ADMs may be minimised
or even eliminated as quickly
as possible,” says Iata
spokesperson, Chris Goater.
This was announced at
the World Travel Agents
Association Alliance’s
(WTAAA) first board meeting
of 2015 held in Toronto,
Canada, this month.
Chris says the organisation
recognises that ADMs are a
major source of friction and
concern between airlines and
agents globally. “Many of
the root causes of ADMs are
the result of a disconnected
and disjointed industry
infrastructure, so that the
end-to-end product lifecycle
suffers from a lack of quality
control and consistency, all
the way through from fare
filing, GDS pricing, and airline
revenue accounting/audit.
The end result of which is all
too often an ADM.”
The working group will
focus on the benefits of
the ARC (Airline Reporting
Corporation) model, which
is the US equivalent of the
BSP settlement plan. Otto
de Vries, Asata ceo, who was
at the WTAAA meeting, says
the ARC model is completely
independent of Iata and
has been at the heart of a
huge drop in ADMs in the
US. The group will aim to
validate and quantify the root
causes of ADMs, which have
already been determined by
ARC. Secondly, the working
group will develop solutions
to remove or to minimise
these root causes by working
in partnership with industry
stakeholders.
Chris agrees that ARC has
already shown in the US what
can be achieved if all the
players in the supply chain
work together collaboratively.
This includes airlines, agents,
trade associations, GDSs and
fare-filing agencies. “It’s now
time for Iata, with the support
of its member airlines and
industry partners, to extend
this initiative worldwide.”
Other issues were
also raised during the
WTAAA meeting, with
recommendations on how
Iata, airlines and agents
could better work together,
for example on the timing of
refunds. It was put forward
that these needed to be
aligned with remittance
cycles, meaning Iata would
need to shorten the period it
takes for refunds to be paid
out. SA travel agents say that
currently refunds can take
anywhere from a week to
three months, depending on
the airline.
It was also suggested that
Iata amend its wording in
its regulations regarding
defaults and guarantees
so that where irregularities
occurred but no BSP airlines
funds were at risk, this would
not lead to an agent being
placed in default. Once the
problem is resolved, Iata
should reinstate ticketissuing
capability as well
as reactivate any ticketing
authority arrangements
with the airlines that had
been contracted prior to the
suspension, the WTAAA said.
Otto says he is confident
the establishment of
the working group is a
constructive way forward to
resolve the issues with Iata
that have been plaguing
South African travel agents
for years. He says the
establishment of the working
group is a clear indication
of Iata’s intention and
willingness to address the
existing problems and to find
a way forward.
The establishment of the
working group will take place
in October and Otto said
participation from South
Africa would be discussed in
the coming few months.