Widening the scope for a discussion, Biji Eapen, National President & D. L Jaghannathan, National Treasurer, told in an exclusive interview that the Travel Agents of India, have been sold out today by the members of their own fraternity ?!
Q: When IAAI got the DGCA Order approving agency commission, it appears that the Airlines have countered with TAP as a trap?
Yes, absolutely.. The agents representatives in APJC India failed totally in their responsibilities to protect the interests of the travel agents in India.
The IATA Res. 810 (i)categorically gives APJC the Authority and terms of Reference to consider all aspects of the Agency Programme, in the country,including the financials tandings for Agency Accreditation & Retention,and make suitable recommendations as per the local criteria to PAConf enable maintain a healthy airline agent partnership. But,unfortunately, our APJC India thinks differently.
The PSA Agreement, the National Law and the DGCA’s Order of 5th March mandates agency commission whereas the IATA-India announcement of TAP on 8th March takes away the privilege of holding ticket stock. While all this was happening, APJC-India maintained a pro-airline/anti agent posture.
Q: You said it is a ‘Partnership’.Then how can airlines withdraw ticket stock?
A few of the foreign airlines,continuing with their hidden agenda to establish monopolization & cartelization, have broken the terms of the PSA Agreement.
Under IATA Res. 824, this Agreement, which has been ratified by GOI effective 21st December, 1992, contractually confers on travel agents the right of commission but APJC disregarded this mandate and supported TF model in Nov 2008.
Similarly, although PSA Agrants to travel agents rights of ticket stock, APJC did not object implementation of Ticketing Authority Process that nullifies this right.Obviously TAP was implemented to coerce travel agents to agree to zero commission and it is to be read as an attempt to subvert National Law that mandates commission.
Further, the implementation procedure laid down by IATA for statement of general concurrence has not been duly followed either.
Q: You are saying that APJC-India is responsible for all these issues. But the other associations are claiming that APJC cannot deal such matters?
Yes, APJC- India is responsible.The general unawareness on agents’ fundamental rights accorded by IATA Resolutions has also contributed to this state of affairs.
The very recent communications from TAAI & TAFI regarding the APJC-India meeting held on 19th April2010 shows the ambiguity that prevails amongst the agency representatives over the scope & functions of APJC-India.
Here are extracts from their circulars.
APJC report circulated by TAAI on 22nd April 2010 :“TAAI placed on record our strong objections on the implementation of TAP without due debate and consideration at the APJC meeting . IATA India,responded stating that there was not enough time to do so, and added that this matter in any case does not come under the purview of APJC. .
TAFI circular dated 26th April: “The scope of what may be discussed at an APJC meeting is rather restricted and all the issues which impact the very survival of agents, like commissions and ticket stock entitlement on all airlines, etc., are out of bounds and cannot be discussed.” On TAP : “IATA responded it was done to meet the highest standards of legal compliance as mandated by their Head Office and therefore did not require discussion prior to implementation”.
Even though, the words ‘Commission’ or ‘General concurrence’ do not fall under the APJC purview,without an amendment or its concurrence, no airline can violate or make a breach of contract to the existing PSAA. Res. 824 is contractual and the financial guarantee mandates ticket capping of all member airlines operating in its jurisdiction. Res. 810(i)empowers APJC-India to monitor and control accreditation and retention of agents. Hence, it is mandatory,that changes in the terms of the contract must be accepted by both parties.One of the parties of the Agreement cannot alter any contractual terms or procedures unilaterally – it has to have the written concurrence of the other party.
In other words, while IAAI was instrumental to make commission our legitimate right through the DGCA Order of 5th March, 2010, the vested interests introduced“TAP’ on 8th March, 2010,effective 1st April.
Though IAAI had requested TAAI & TAFI to confirm whether TAP was discussed at APJC meeting, prior to such implementation, they never responded, where as IATA India confirmed that same was not tabled since APJC had not held a meeting after Aug 2009.
Q: Is it to be understood that, had the agency representatives of APJC India objected to the implementation of TAP,IATA may not have enforced the same?
Yes, here are the facts.In a recent communiqué,IATA-India had very clearly,explicitly and categorically stated that the matter was neither presented to APJC or discussed, nor did any APJC member ever ask for such a discussion. This paved the way for IATA to implement TAP.
Since there hasn’t been an APJC meeting convened since August last year, it was neither placed on an APJC agenda nor was there any compelling need to do so,considering that dissemination of the fact was effected directly to all BSP participating airlines and agents. This information also will be further disseminated at all ensuing industry meetings.
There was no APJC meeting since Aug 2009 and there was no compulsion from any of the members. So, IATA is very clear that, had there been any request from any APJC members, the issue could have been opened and discussed.
Q: Do you mean to say that the ‘Zero’ commission could have also been prevented in a similar manner?
Yes. Even after the failure of the Karnataka High Court case, the associations represented in APJC-India had many occasions to call for an APJC meeting and take up the issue as it is a“contractual violation” of Resolution 824 and regain commission as per Rule 135of the Indian Aircraft Rules,1937.
1 When, the Kerala HighCourt had directed DGCA on13th July, 2009, to take action in accordance with the National Law.
2 At their APJC Meeting in August 2009.
3 After the DGCA Meeting on7th Sep’09 where DGC A ruled that neither ‘Zero’ commission nor ‘Transaction Fee’ were mentioned in any IATA Resolutions.
4 After the MoCA meeting on19th Nov’09.
5 When IAAI filed the Contempt of Court on 8thFeb’10.
6 Even after the DGCA Order of 5th Mar’10.
7 or , even after the announcement of TAP on 8thMarch, 2010.
It is quite strange that an association circular, reporting on the APJC meeting of19th Apr’10, states that –“Finally before closure of the meeting Agent representatives reminded IATA about the DGCA Order.”
Just look at the low priority given to the Commission issue by the APJC Representatives when the whole Industry is fighting for commission.
See how the APJCs in other countries are functioning.Here is an extract from Nour NOSSEIR from Egypt – “I am pleased to inform you that APJC activities in Egypt is going as per our plans, we have even managed to replace the chair person twice and select the person we approve to act in accordance to guidelines for conducting business council’s meetings according to international best practices.Currently IATA country manager is conducting perfectly his proper role as APJC secretary after he has seen 2 of his former directors sacked as escape goats to protect their bosses sitting in Geneva!!??”
Q: The Commission matter is now clear. It is understood that IATA claims TAP will “ensure the highest standards of legal compliance with Antitrust& Competition Laws”.How will it affect the travel agents?
In answer to your question,we have a few of our own that we wish to ask on behalf ofthe fraternity at large.
Ø What was the urgency to implement TAP without a formal discussion with APJC?
Ø Whose interest did this urgency serve?
Ø Why TAP does not comeunder the purview of APJC ?
Ø How can a legal requirement justify the hasty implementation of TAP without a discussion when it leads to a ‘breach of contract”under Res.824 ?
Ø Highest standard of legal compliances – in whose interest ?????
Now look at the “actual”urgency for all this actions.To safe guard the interests of certain Zero airlines, TAP was introduced immediately on 8th March, 2010, just 3 days after the DGCA Order of 5th March, 2010.
‘TAP’. is only an optional facility for airlines to appoint agents under a statement of general concurrence vide Res 878 & 820 . The implementation of TAP by IATABSP-India on 1st April 2010,was procedurally wrong,unilateral, arbitrary and illegal as per the same Resolutions 878 & 820.Instead of reporting the procedural irregularities & failures, the Agent Representatives of APJC India willingly supported and ratified the airline move!
Q : If the Agent Representation in APJC failed to stop TAP, is IAAI going to accept it or planning for any action?
Yes, of course. We always have a ‘Vision & a Mission’.Our Agenda is very clear –we are going to challenge TAP, the deliberate exclusion of IAAI from APJC-India, the weekly payment system,migration to Res. 818g and the deliberate de-recognition of Insurance Guarantee leaving the agents no choice but to opt for Joint Bank Guarantees systems that enslave them to the respective Associations..
We are also challenging the eligibility and admissibility of the four “Zero Airlines”dictating their terms in APJC India.when IATA resolutions do not recognize TF or zero commission. Having violated Indian rules, they have forfeited their right to be on the board of APJC.
Q: What is your action plan?
Regarding APJC-India, we have already taken up the issue with GOI, BAR-India,IATA & PAConf.
Regarding TAP, the preliminary steps through the GOI have already been completed by end-April. We are now setting up legal process.For your information, TAP has not been implemented in Canada or ARC in theUSA, and, in the Philippines,PR, TG and even SQ have not put any restrictions on ticket stock to agents..
Q: Before ending, just one more question. Since the airlines have not acceded to the DGCA Order, what is your next action?
The High Courts will be reopening next week after the annual vacations. Before proceeding with any further legal action against this non compliance, IAAI , a spetitioner, has sent notices to all the respondent Airlines to start paying commission at 5% on gross and also made are presentation to the Director General of Civil Aviation requesting intervention for effective implementation of the law as two months have elapsed since DGCA issued the order and sales in crores of Rupees have flowed out.
Now, we would like to put a question to the fraternity .
Ø Are our trade representatives who participated in the APJC meeting ignorant of the IATA Resolutions and its interpretations or, are they just incompetent to put up a logical defense for the Industry?
OR
