Biden will direct U.S. study of airport slots, aviation market structure - adviser - Reuters

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Delta Air Lines passenger planes are seen parked due to flight reductions made to slow the spread of coronavirus disease (COVID-19), at Birmingham-Shuttlesworth International Airport in Birmingham, Alabama, U.S. March 25, 2020. REUTERS/Elijah Nouvelage

WASHINGTON, July 9 (Reuters) - An executive order to boost competition that President Joe Biden is to sign on Friday will direct U.S. regulators to review airport slots and aviation market structure issues, a White House adviser told Reuters.

White House economic adviser Bharat Ramamurti said the U.S. Transportation Department "is going to look into slot issues and other market structure competition issues... It is our goal to have more competition in the airline industry," Ramamurti said.

Rules on the allocation of airport slots have big ramifications for airline competition and market access for low-cost carriers.

"That's an area that deserves further study to figure out how to balance a variety of competing interests," Ramamurti said.

Biden's order also directs the Transportation Department to propose new rules to require passenger airlines to refund fees for bags that are significantly delayed and refunds for services like onboard Wi-Fi that do not work.

Under existing U.S. Transportation Department rules, passengers are entitled to a fee refund if bags are lost, but not when delayed.

Under the proposed rule to be released in the coming days, a “significantly delayed checked bag” is one not delivered to the passenger within 12 hours for domestic itineraries and within 25 hours for international itineraries.

Airlines for America, a group representing major airlines including American Airlines, Delta Air Lines and United Airlines, wrote White House economic adviser Brian Deese on Thursday to discuss the proposals.

The group said Friday that "robust competition in the U.S. airline industry has generated unprecedented levels of affordability and accessibility, benefiting the customer at every level."

A draft of the executive order seen by Reuters directs the department to evaluate "existing commercial aviation programs, consumer protections" and to consult with the Justice Department "to ensure competition in air transportation and the ability of new entrants to gain access."

It also directs considering "measures to support airport development and increased capacity and improve airport congestion management, gate access... and 'slot' administration."

The administration proposal would also require airlines to promptly refund fees – such as for advance seat selection, Wi-Fi and other flight services – if the passenger does not receive the service or it does not work.

U.S. airlines collected approximately $5.8 billion in baggage fees and $2.8 billion in change and cancellation fees in 2019, up from just $464 million in baggage fees and $915 million in change and cancellation fees in 2007.

The Transportation Department also intends to issue a separate proposed rule to require upfront disclosure of baggage fees, change fees and cancellation fees.

Reporting by David Shepardson, Editing by Franklin Paul and Alistair Bell

Our Standards: The Thomson Reuters Trust Principles.

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