After spending nine months considering whether changes are needed to its airfare advertising rules and finding no consensus among airlines, the U.S. Transportation Dept. decided not to make any changes after all.

DOT yesterday withdrew a notice of proposed rulemaking (NPRM) that suggested four options for modifying the fare advertising rules, including a no-change option. The comments submitted did not present a compelling case to change the rule, and DOT also found that the rule provides appropriate protection to consumers as it stands. While airlines were split on whether the rule should be retained, loosened or abolished, individual commenters were mainly in favor of tightening advertising rules.

The advertising rule changes were first proposed by DOT in December 2005. This was prompted by a request from the Air Transport Association to allow airlines to separately list fuel surcharges, in the same way they are currently allowed to list government fees separately. DOT denied this request, but instead said it would launch a review of all ticket advertising restrictions (DAILY, Dec. 15).

Current DOT rules require airlines to list the full fares in any advertisement, although in practice it does allow a list of exceptions to this rule, most notably allowing government taxes and fees to be broken out. The first of the options in the NPRM proposed keeping the current rule, and either codifying the exceptions policy or keeping it informal. This is the option DOT chose, without codifying the exceptions.

The other options were strictly enforcing the rule as written, which would abolish the exceptions policy; eliminating most advertising restrictions but requiring airlines to disclose the full price before purchase; and eliminating DOT's fare advertising rule altogether.

Of the 21 airlines submitting comments, 10 opted for the first "status quo" option. This group included Qantas, Alaska, Southwest, Singapore, and JetBlue. None supported the second option, and four supported the third including Northwest, Continental, Cathay Pacific and Air Tahiti Nui. The four airlines recommending the fourth option were Delta, American, United and Lufthansa. British Airways, Aer Lingus and US Airways suggested combining different elements of the four options.

In selecting the first option, DOT decided "the public interest will best be served by our maintaining the status quo...we find the reasons for maintaining the status quo to be the most compelling." As it is currently enforced, the rule and its exceptions protect consumers, help price comparisons, foster fare competition, and give airlines "an appropriate degree of freedom to innovate," DOT said.

DOT believes the rule produces about the same results as the Federal Trade Commission's policies would, so if the DOT rules were loosened, advertising restrictions would gradually resume their current form. Also, eliminating a rule which has worked well for more than 20 years makes no sense, said DOT. The department argued that current exceptions should not be codified, allowing it the flexibility continue refining and modifying the exceptions without the need for a rulemaking. Also, airlines and their lawyers are familiar enough with DOT enforcement policy that codification is not needed.