Biden’s Airline Fee Disclosure Mandate Halted by Court

A U.S. appeals court has temporarily halted the Biden administration’s policy requiring airlines to disclose fees upfront, citing procedural missteps.

At a Glance

  • U.S. appeals court blocks Biden administration’s 2024 airline fee disclosure rule
  • Court cites procedural non-compliance by the Transportation Department
  • Rule aimed to enhance transparency and prevent “bait-and-switch” tactics
  • Major airlines and trade groups sued to overturn the regulations
  • Case highlights challenges in balancing consumer protection with regulatory compliance

Court Halts Biden’s Airline Fee Disclosure Rule

In a setback for the Biden administration’s efforts to increase transparency in airline pricing, a U.S. appeals court has blocked a 2024 rule requiring upfront disclosure of airline fees. The court’s decision stems from the Transportation Department’s failure to comply with procedural rules, highlighting the complexities of implementing consumer-friendly regulations while adhering to strict administrative protocols.

The rule, finalized in April 2024 as “Enhancing Transparency of Airline Ancillary Service Fees,” was designed to eliminate what the Department of Transportation (DOT) described as deceptive practices in the industry. “The rule would end ‘bait-and-switch’ tactics some airlines use to disguise the true cost of discounted flights,” added USDOT.

Industry Pushback and Legal Challenges

The regulation faced significant opposition from major airlines and industry groups. American Airlines, Delta, United, JetBlue, Alaska Airlines, and trade organizations such as Airlines for America and the International Air Transport Association filed lawsuits to overturn the rules. These entities argued that the regulations would necessitate costly website re-engineering and potentially harm the industry financially.

Airlines for America, representing the industry’s stance, argued that the rule would “do more harm than good.” This sentiment reflects the ongoing tension between consumer protection measures and the operational concerns of airlines.

Procedural Error and Next Steps

While the court acknowledged the DOT’s authority to create fee disclosure rules addressing unfair or deceptive airline practices, it found a critical procedural error. The judges noted that the DOT should have allowed airlines to comment on a related study that suggested only a 53% probability of net societal benefits from the rule.

“DOT should have allowed Petitioners the opportunity to comment on the study,” the judges stated in their ruling. This oversight has led to the temporary suspension of the rule’s implementation while the DOT addresses these concerns.

The case has been sent back to the DOT for correction of the procedural error. However, with changes in the political landscape, including President Trump’s return to power, it remains uncertain whether the DOT will continue pursuing this rule with the same vigor as the Biden administration initially intended.