Airlines’ overbooking limit gone with bill of rights —CAB

There has been no limit as regards the percentage that airline companies may overbook since the implementation of the Air Passenger Bill of Rights in 2012, an official of the Civil Aeronautics Board said on Wednesday.

CAB executive director Carmelo Arcilla said overbooking or the practice of selling more tickets than the available seats on a flight was "a global practice” which allowed  airlines to fill the vacant seats of “no-shows.”

Arcilla said there was a 10-percent limit on overbooking but this was no longer implemented with the implementation of the APBR.

“When APBR was issued, nawala ang 10-percent limit. Ang perception, merong effective counterweight in the sense na ang compensation package pag nag-overbook ang airline ay deterrent for abuse,”  Arcilla said.

(When the APBR was issued, the 10-percent limit was removed. The perception is there's an effective counterweight in the sense that the compensation package for passengers when airlines overbook will be a deterrent for abuse.)

Public interest values

Arcilla said overbooking had public interest values such as lower fares. He said another is to allow chance passengers to avail of the seats.

He said the unique feature of the overbooking regulation under the APRB was that airlines may look for passengers who would volunteer to be offloaded from the flight in exchange for compensation and other amenities.

Arcilla said the airlines should improve the offer until they get a volunteer if there were no takers.

He clarified that all passengers who booked their flights should not be denied the right to be checked in, and that the offloading of passengers would only happen at the boarding gates.

‘Non-refundable no-shows’

Senator Raffy Tulfo said there should be a certain percentage under the airlines' overbooking mechanism.

“Halimbawa, no-show ka. ‘Di ba dapat non-refundable yon? Ba’t nago-overbook ang airlines kung ‘di refundable ang no shows?” Tulfo said.

(For instance, aren't no-shows supposed to be non-refundable? Why are airlines overbooking if no-shows are not refundable?)

Arcilla said the CAB also wanted to change the system and that they would defer to the wisdom of the Senate.

“Naniniwala po kami na different times call for different policies. Kami ay nakahanda, nire-review namin ito and we seek guidance from the committee,” the CAB official said.

(We believe that different times call for different policies. We are ready, we are reviewing this, and we seek guidance from the committee.)

Modus, says Binay

Senator Nancy Binay said the policy had become a new “modus” in the airline industry.

“Kasi nakita nga nila na sa overbooking malaki ‘yung kailangan nilang i-provide d'on sa passenger kaya ang ginagawa nila ngayon, three days before or four days before, sasabihan ka nila na cancelled ang flight mo,” Binay said.

(They are seeing that with overbooking, they have to provide something substantial to the passenger so what they are doing now is they tell you your flight has been cancelled three or four days before.)

“Siyempre kung nasa ibang bansa ka, who will shoulder your hotel? Sa Air Passenger Bill of Rights, pag cancellation, napaka-minimal ng kailangan gawin ng airline—rebook, refund tapos bahala ka na sa buhay mo kung paano ka kakain at saan ka matutulog,” she added.

(If you are abroad, who will shoulder your hotel? Under the Air Passenger Bill of Rights, the airline only has minimal requirements if a flight is cancelled. Rebook, refund, and then you're on your own where you'd eat and where you'd sleep.)

Binay said there were instances when offloaded passengers were told that the flight had been cancelled but it turned out that the it actually pushed through.

This practice is illegal, Arcilla said.

‘Sanctions imposed’

This prompted the senators to ask if CAB was imposing sanctions against airlines for supposed incidents.

Arcilla said the CAB had not slapped any airline with sanctions recently because it was conducting meetings on the heightened incidents of cancellation due to the supply chain disruption.

He said the CAB in 2022 already imposed millions of pesos in sanctions on some airlines.

Binay said airlines should not offer flights which they could not provide to the public.

“Parang tuloy-tuloy silang nagbebenta at kumikita pero 'di naman pala nila kayang i-provide ang ganoong service,” Binay said.

(It seems they continue to sell and profit but they could not provide the service.)

Arcilla said the reason for the conduct of the meetings with airlines is to reduce the flights “in an orderly fashion” because it might cause a collapse in the air transportation services.

Apologized

In the same hearing, Cebu Pacific and Philippine Airlines apologized for the recent "disruptions" and "inconveniences" which both airlines said due to engine and supply chain issues.

“These delivery delays necessitate changes to our flight schedules, including flight cancellations and equipment changes from larger to smaller aircraft which may cause some passengers to be disrupted and cause the perception of overbooking,” Cebu Pacific chief commercial officer Alexander Lao said.

“Rather than canceling the flight, the use of smaller aircraft allows us to still bring as many customers as possible to their destination and lessen the number of disrupted passengers,” he added.

PAL Vice President for Legal Affairs Ma. Clara de Castro also shared the same experience. This, she said, prompted the flag carrier to implement a “proactive reduction” of flight schedules.

Congressional franchises

At the latter part of the hearing, Senator Grace Poe reminded the airline companies that they were given congressional franchises which required them to submit reports.

“I think, Madam Chair, that eventually we are going to review all these commitments that they have with their franchise," said Poe, the chairperson of the Senate Committee on Public Services.

"Otherwise, I think that they are taking it for granted. Just a reminder, Madam Chair,” she added. 

She said that some airlines had not submitted recent reports yet on their expansion activities and developments to Congress.

Poe reminded the CAB that it was their responsibility to check if airline companies had been compliant with their franchise obligations before granting them a permit to operate. —NB, GMA Integrated News