Archaic Airline Rules Repealed

Archaic Airline Rules Repealed

Regulations on Computer Reservation Systems to Be Dropped
January 08, 2004

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Richard Morrison, 202.331.2273


<?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Washington, D.C., January 9, 2004—The Competitive Enterprise Institute applauds the decision by the Department of Transportation to abolish an outdated assortment of regulations controlling the computer reservation systems (CRS) for air travel.  Eliminating the rules will allow greater freedom for the industry to improve their marketing and customer service abilities and spur development of better ways of meeting the demands of customers, travel agents, and airlines themselves.


The Department of Transportation’s decision reflects an understanding of the dynamic nature of free markets, and the dramatic changes in the airline and travel industry in recent years in particular.  Calling the old rules “pre-Internet age,” DOT has recognized that consumers are increasingly changing traditional purchasing habits and relying on online travel sites and direct purchases from carriers.  Seeing this, they have decided to stop micromanaging what information one particular group of travel companies can and cannot display.


“Perhaps the best aspect of this process is that the old rules weren’t merely replaced with another set of supposedly ‘updated’ regulations,” said Competitive Enterprise Institute Technology Counsel Braden Cox.  “Too often ineffective and outdated regulations, when they’re addressed at all, are merely rearranged by bureaucrats into new forms.  The DOT deserves praise for its realization that government regulation was creating more problems than it solved and allowing the current CRS rules to expire. 


Airlines built their internal reservations systems to connect to travel agencies, giving agencies their first automated means of creating airline reservations electronically.  CRSs are the world’s first networked infrastructure for electronic commerce.  


CEI has long been an advocate for CRS deregulation.  CEI filed comments with the DOT and its president, Fred L. Smith, Jr., testified before a Department of Transportation hearing in favor of the elimination of the computer reservation system regulations.