IATA to withdraw
The world’s largest trade association representing and serving the airline industry is threatening to pull out its programme from Sri Lanka over a payments dispute involving local travel agents and the government that has been brewing for months, Travel Agents Association of Sri Lanka (TAASL) officials said.
The threat came after Director General Civil Aviation (DGCA) H.M.C. Nimalsiri stepped up pressure on the International Air Transport Association (IATA) through a directive issued to local travel agents to continue with the 10-day payment cycle for airlines. IATA wants a 7-day settlement period. Agents say in this case often the actual period of credit is less than seven days since the number of days includes even Saturdays, Sundays and other holidays.
IATA accredited travel agents use a business settlement plan (BSP) through IATA’s network when making payments on airline reservations. TAASL has pointed out that Resolution 001 of IATA rules requires IATA to comply with government action in respect of each country and which has been carried out in Ethiopia, France, Hong Kong, India, Indonesia, Israel, Italy, Jordan, Malawi, Macau, China Pakistan, Saudi Arabia and the UK. IATA resolutions in terms of the IATA rules are modified in respect of these countries.
In a statement TAASL said, “Even though its own rules require it to comply with Government action in each country in the application of the rules of that country, IATA is threatening the government with withdrawal of the entire programme unless the directive is withdrawn.”
Travel agents are awaiting government action in this regard, and hope to meet with civil aviation authorities this week since Mr. Nimalsiri was learnt to be out of the country at time of going to press.
On March 20 the local travel industry obtained unanimous approval from all airlines to continue with the current 10 day settlement plan.
Subsequently, IATA conducted a mail vote, the results of which were kept secret. The organization insisted that due to four votes supporting a seven day payment cycle this was to be implemented.
“A number of positive votes had been cast one abstention and four negative votes were received. Accordingly, this mail vote is hereby declared defeated,” IATA stated regarding the results of the vote taken.
However, it is learnt that when local travel agents consulted the matter with the DGCA the latter stated they could continue with the 10-day payment plan and this directive was forwarded to IATA as well through the local authority.
On June 27 local travel agents held an emergency meeting and expressed shock at the latest response received by IATA insisting that they reduce the payment period from 10 to seven days disregarding the DGCA’s ruling.
In this respect, the association sent a response to IATA in Singapore on June 28 requesting them to abide by the ruling given by the local authorities as it was impossible to “bend the rules of the land.”
As a result agents decided to seek legal advice and a meeting with the civil aviation authority next week.
Agents accrue total sales amounting to Rs.2.8 billion with remittances for SriLankan Airlines at 30-35 per cent of the sales and rest for foreign carriers through this BSP.
In 2006 IATA-BSP managed to convince the airlines not to trade with any travel agent which has not obtained the IATA accreditation as a result of which all travel agents were forced to join this payment system.
Follow @timesonlinelk
comments powered by Disqus