PART 260—REFUNDS FOR AIRLINE FARE AND ANCILLARY SERVICE FEES Authority: 49 U.S.C. 40101(a), 41702, 41712, and 42305. Source: DOT-OST-2022-0089 and DOT-OST-2016-0208, 89 FR 32832, Apr. 26, 2024, unless otherwise noted. § 260.1 Purpose. The purpose of this part is to ensure that carriers promptly refund consumers for: (a) Fees for ancillary services related to air travel that consumers paid for but were not provided; (b) Fees to transport checked bags that are lost or significantly delayed; and (c) Airfare including nonrefundable airfare for a flight that is cancelled or significantly changed where the consumer does not accept the significantly changed flight or rebooking on an alternative flight, or accept any voucher, credit, or other compensation offered by the carrier. [DOT-OST-2022-0089, 89 FR 65536, Aug. 12, 2024] § 260.2 Definitions. As used in this part: Air carrier Ancillary service Automatic refund Break in journey Business days Cancelled flight flight cancellation Cash equivalent e.g., Checked bag e.g., e.g., Class of service Covered carrier Covered flight Foreign air carrier Individual with a disability Merchant of record Prompt refund Significantly delayed or changed flight (1) The consumer is scheduled to depart from the origination airport three hours or more for domestic itineraries and six hours or more for international itineraries earlier than the original scheduled departure time; (2) The consumer is scheduled to arrive at the destination airport three or more hours for domestic itineraries or six or more hours for international itineraries after the original scheduled arrival time; (3) The consumer is scheduled to depart from a different origination airport or arrive at a different destination airport; (4) The consumer is scheduled to travel on an itinerary with more connection points than that of the original itinerary; (5) The consumer is downgraded to a lower class of service; (6) The consumer who is an individual with a disability is scheduled to travel through one or more connecting airports different from the original itinerary; or (7) The consumer who is an individual with a disability is scheduled to travel on substitute aircraft on which one or more accessibility features needed by the customer are unavailable. Significantly delayed checked bag [DOT-OST-2022-0089 and DOT-OST-2016-0208, 89 FR 32832, Apr. 26, 2024, as amended by DOT-OST-2022-0089, 89 FR 65536, Aug. 12, 2024] § 260.3 Applicability. This part applies to: covered carriers that are the merchants of record; covered carriers that operate the flight or, for multiple-carrier itineraries, covered carriers that operate the last segment of a flight where a ticket agent is the merchant of record for a checked bag fee; and covered carriers that fail to provide an ancillary service (other than checked bag service) for which the consumer paid where a ticket agent is the merchant of record for an ancillary service fee other than checked bag fee. § 260.4 Refunding fees for ancillary services that consumers paid for but that were not provided. (a) A covered carrier that is the merchant of record shall provide a prompt and automatic refund to a consumer for any fees it collected from the consumer for ancillary services if the service was not provided through no fault of the consumer ( e.g., (b) In situations where the ancillary service the consumer paid for (other than the service of transporting a checked bag) is not available for all the passengers who paid for that service ( e.g., (c) In situations where the ancillary service the consumer paid for (other than the service of transporting a checked bag) is not available to an individual or several individuals, rather than to all the passengers who paid for that service, a carrier's obligation under paragraph (a) of this section to provide a prompt and automatic refund begins when the consumer affected by the service failure notifies the operating carrier that failed to provide the ancillary service about the unavailability of the service and that information has been confirmed and, if applicable, relayed as provided in paragraph (d) of this section to the carrier responsible for providing a prompt refund as specified in paragraph (a) of this section. Notification of the unavailability of the ancillary service by a consumer is considered a request for a refund. (d) In situations where a carrier is the merchant of record for a fee for an ancillary service and the carrier that operates the flight where the ancillary service was not provided are different entities, the operating carrier that failed to provide the ancillary service must timely notify the carrier that is the merchant of record about the unavailability of the ancillary service. Notification by the operating carrier as set forth in this paragraph is necessary for the obligation to provide a prompt refund of ancillary service fees in paragraphs (b) and (c) of this section to apply. The obligation set forth in this paragraph for the operating carrier to timely notify the carrier that is the merchant of record does not apply when the failure to provide service relates to transporting checked bags. Timely notification requirements pertaining to refunds for fees charged to transport checked bags are set forth in § 260.5(c). § 260.5 Refunding fees for significantly delayed or lost bags. A covered carrier that is the merchant of record or, if a ticket agent is the merchant of record, the covered carrier that operated the flight or the last flight segment in a multiple-carrier itinerary, must provide a prompt refund to a consumer of any fee charged for transporting a lost bag or a significantly delayed checked bag, as defined in § 260.2 of this part and determined according to paragraph (a) of this section, subject to the conditions in paragraphs (b) and (c) of this section. (a) Determining the length of delay for the bag. e.g., (b) Notification by passenger about lost or significantly delayed bag. (c) Notification by carrier that received an MBR about lost or significantly delayed checked bag. (d) Automatic refunds. (e) Amount of the refund. (1) For carriers that adopt an escalated baggage fee scale for multiple bags checked by one passenger, the amount of baggage fee refund issued to the passenger can be determined based on the unique identifier assigned to the significantly delayed or lost bag that correlates to the baggage fee charged for that bag at the time of checking. If there is no such unique identifier assigned, carriers must refund the highest per bag fee or fees charged for the multiple bags. (2) For a carrier that offers a baggage fee subscription program where consumers can pay a subscription fee that covers fees for checked bags for a specified period, the carrier must refund the lowest amount of the baggage fee the carrier charges another passenger of similar frequent flyer status and in the same class of service without the subscription when a passenger subscribing to the program has a significantly delayed or lost bag. (f) Exemptions from the refund obligation. (1) A passenger's failure to pick up and recheck a bag at the first international entry point into the United States as required by U.S. Customs and Border Protection; (2) A passenger's failure to pick up a checked bag that arrived on time at the passenger's ticketed final destination due to the fault of the passenger if documented by the carrier ( e.g., (3) A passenger's voluntary agreement to travel without the checked bag on the same flight as described in paragraph (g) of this section. (g) Voluntary separation from bag. i.e., § 260.6 Refunding fare for flights cancelled or significantly delayed or changed by carriers. (a) Carriers' obligation to provide refunds Carriers' obligation. (i) Fly on the significantly delayed or changed flight or accept rebooking on an alternative flight; or (ii) Accept any voucher, credit, or other form of compensation offered by the air carrier or foreign air carrier pursuant to paragraph (c) of this section. (2) Automatic refunds. (i) A flight is canceled and a consumer is not offered an alternative flight or any voucher, credit, or other form of compensation by the air carrier or foreign air carrier pursuant to paragraph (c) of this section; (ii) A consumer rejects the significantly delayed or changed flight, rebooking on an alternative flight, or any voucher, credit, or other form of compensation offered by the covered carrier pursuant to paragraph (c) of this section; or (iii) A consumer does not respond to an offer of: (A) A significantly delayed or changed flight or an alternative flight and the flight departs without the consumer; or (B) A voucher, credit, or other form of compensation by the date on which the cancelled flight was scheduled to depart or the date that the significantly delayed or changed flight departs. (b) Individuals with a disability. (1) The individual with a disability is downgraded to a lower class of service that results in one or more accessibility features needed by the individual becoming unavailable. (2) The individual with a disability is scheduled to travel through one or more connecting airports that are different from the original itinerary. (3) The individual with a disability is scheduled to travel on a substitute aircraft on which one or more accessibility features available on the original aircraft needed by the individual are unavailable. (c) Alternative to refund. (1) The offer includes a clear and conspicuous notice of— (i) The terms of the offer as specified in § 260.8; and (ii) The consumer's right to a full refund under this section. (2) The voucher, credit, or other form of compensation offered explicitly as an alternative to providing a refund required by paragraph (a) of this section remains valid and redeemable by the consumer for a period of at least five years from the date on which such voucher, credit, or other form of compensation is issued; (3) Upon the issuance of such voucher, credit, or other form of compensation, a covered carrier notifies the recipient of the expiration date of the voucher, credit, or other form of compensation; and (4) Upon request by an individual who self identifies as an individual with a disability a covered carrier provides a notification under paragraph (c)(3) of this section in an electronic format accessible to the recipient. (d) Carriers' obligation to notify ticket agents. i.e., (e) Carriers' obligation to transfer funds to ticket agents. [DOT-OST-2022-0089, 89 FR 65537, Aug. 12, 2024] § 260.7 Affirmative acceptance of an offer of alternative compensation. A covered carrier must not deem a consumer to have accepted an offer for travel credits, vouchers, or other compensation in lieu of a refund under § 260.6(c) unless the consumer affirmatively agrees to the alternative form of compensation. [DOT-OST-2022-0089, 89 FR 65537, Aug. 12, 2024] § 260.8 Disclosing material restrictions, conditions, or limitations. In carrying out the requirements of § 260.6(c), a covered carrier must clearly and conspicuously disclose, no later than at the time of voucher or credit offer, any material restrictions, limitations, or conditions on travel credits, vouchers, or other compensation, including but not limited to validity period, advance purchase requirement, capacity restrictions, and blackout dates, regardless of whether consumers are entitled to a refund. [DOT-OST-2022-0089, 89 FR 65537, Aug. 12, 2024] § 260.9 Notification to consumers. (a) Upon the occurrence of a flight cancellation or a significant delay or change, a covered carrier must timely notify affected consumers about the cancellation or significant delay or change, and the information relating to any alternative to refund as provided in § 260.6(c). (b) Covered air carriers must ensure that their passenger notification systems notify passengers owed a refund pursuant to § 260.6(a) and (b) of their right to receive a refund. Covered carriers that provide notification subscription services to passengers must ensure notifications under this paragraph be provided through media that the carriers offer and the subscribers choose, including emails, text messages, and push notices from mobile apps. [DOT-OST-2022-0089, 89 FR 65538, Aug. 12, 2024] § 260.10 Providing prompt refunds. When a refund of a fare or a fee for an ancillary service, including a fee for lost or significantly delayed checked baggage, is due pursuant to this part, the refund must be issued promptly in the original form of payment ( i.e., [DOT-OST-2022-0089 and DOT-OST-2016-0208, 89 FR 32832, Apr. 26, 2024. Redesignated by DOT-OST-2022-0089, 89 FR 65538, Aug. 12, 2024] § 260.11 Contract of Carriage provisions related to refunds. A carrier must not include terms or conditions in its contract of carriage inconsistent with the carriers' obligations as specified by this part. Any such action will be considered an unfair and deceptive practice within the meaning of 49 U.S.C. 41712. [DOT-OST-2022-0089 and DOT-OST-2016-0208, 89 FR 32832, Apr. 26, 2024. Redesignated by DOT-OST-2022-0089, 89 FR 65538, Aug. 12, 2024]