DGCA asks agents, foreign carriers to end standoff

NEW DELHI: Aviation industry regulator Directorate General of Civil Aviation (DGCA) has asked foreign carriers such as Lufthansa, Singapore Airlines and Air France and travel agents to sort out their differences on the issue of commission by September 30 failing which it would take a decision binding on all.

Members of six associations, including the Travel Agents��� Association of India (TAAI), Travel Agents Federation of India (TAFI) and the IATA Agents Association of India (IAAI) have demanded restoration of agent commission by foreign airlines.

Almost 16 foreign airlines out of over 60 which fly to and from India stopped paying 5% commission to agents from November last year. The carriers shifted to a fixed transaction fee on every ticket purchased reducing the agent commission significantly.

���DGCA has to take a view keeping local laws and International Air Transport Association (IATA) resolutions in mind. In our preliminary finding, the so-called transaction fee does not figure in IATA resolution. Foreign carriers are practising a model which has no place in IATA resolution,��� DGCA deputy director general RK Maheshwari said.

Lufthansa director (south Asia) Axel Hilgers, however, said that the airline was not flouting any regulatory requirements. He said that the issue of commission is between airline and agents and the former should have the commercial liberty to take a decision (how much commission has to be paid to agents).

���We want a level-playing field. Low-cost airlines do not pay any commission to the agents. We compete with those airlines on various routes. If we have to compete with them, we have to follow a competitive cost structure,��� Mr Hilgers said.