New airline rule limits delays for international flights, requires fee refunds for lost bags

A traveler is seen in Terminal C at Dallas Fort Worth International Airport as aircraft taxi along a runway in Grapevine, Texas.

DALLAS — Airlines will soon be required to refund bag fees if they lose luggage, and they'll pay travelers more for bumping them from a flight.

The federal government planned to announce new passenger protections Wednesday that also expand a tarmac-delay rule to prevent passengers from being stranded on international flights for longer than four hours.

The airlines will also have to include fees and taxes in advertised prices.

U.S. Transportation Secretary Ray LaHood said the new regulations, which take effect in late August, were designed to make sure airlines treat travelers fairly.

"It's just common sense that if an airline loses your bag or you get bumped from a flight because it was oversold, you should be reimbursed," he said.

The new provision on tarmac delays expands upon last year's 3-hour limit for flights within the U.S. Regulators were persuaded to apply a 4-hour limit to international flights after a late-December debacle in which several planes loaded with international travelers were stuck, some for more than 10 hours, on snowy runways at New York's JFK Airport.

Airline trade groups have warned that airlines will cancel more international flights to avoid the fine of up to $27,500 per passenger that comes with breaking the rule. The fine could total more than $10 million for a fully loaded superjumbo jet like an Airbus A380 — although the government has never imposed anything close to the maximum.

The groups note that with some international flights operating only once every few days, passengers could be stranded far longer under the new rule.

On refunding bag fees for lost luggage, the Transportation Department decided not to require refunds for bags delivered late. Airlines are already required to compensate passengers for the value of lost bags, regardless of whether a fee was paid to check them. Last year, airlines mishandled 2 million bags, although that includes damaged and delayed ones.

Wednesday's rule confirms another change that the regulators proposed last year — more compensation for passengers bumped off oversold flights. Currently, it's up to $400 or $800 depending on how long a passenger is delayed before catching a makeup flight. Those limits will be raised to $650 and $1,330.

Last year, airlines bumped 65,000 passengers and another 681,000 took voluntary offers to give up their seats. Still, that's a tiny fraction of 1 percent of all travelers. The higher limits could give savvy travelers leverage to cut a better deal for their seats after gate agents ask for volunteers.

The new rule also requires airlines to prominently disclose all potential fees — for checking bags, changing reservations, upgrading seats, and so on __ on their websites. Airlines will also have to include taxes and government-imposed fees in the fares that they advertise. Airlines had argued that car dealers and other businesses don't have to do that.

But in a setback for travel agents, the government declined at least temporarily to force airlines to clearly disclose all fees in their electronic connections with agents.

Regulators also dropped a proposal to require that airlines include their customer-service promises in their legal contracts with passengers. While it sounds bureaucratic, consumer groups see it as an important step in forcing airlines to live up to their promises.

Consumer advocates didn't get everything they wanted but were pleased overall.

"There's going to be a lot of good stuff, a lot of little things that will make people feel better about traveling," said passenger-rights advocate Kate Hanni.