Published on Tuesday, September 15, 2015

TMCs boycott Lufthansa's levy on booking through GDS

The majority of Travel Management Companies have said that they have not or will not register for Lufthansa's website to avoid a charge for booking via a GDS.

67% of the GTMC's member base of the UK's top TMCs have declared they won't register while a further 27% have registered but say it is purely to look at the capability of the agency portal, not to use it for bookings.

Only 6% of GTMC member businesses have signed up to but claim they will only use the direct channel, bypassing a GDS, if requested to do so by a client.

It follows Lufthansa announcing a €16 fee for any bookings made via a GDS.

The airline is encouraging TMCs to book via, however the site cannot provide any of the reporting or duty of care functionality required by TMCs.

Paul Wait, chief executive, the GTMC said: "Lufthansa has publically claimed that TMCs have been signing up to use their website directly, however the behaviour of GTMC members show that simply isn't the case.

"In fact, our member booking activity is testament that the GDS levy isn't working.

"The good news for airlines who recognise and support TMCs is that Lufthansa is handing corporate travel bookings to them. The changes from Lufthansa may have been rooted in trying to solve cost challenges for the airline, however they haven't addressed what corporate customers and business passengers want."

GTMC says its members book 80% of expenditure spent on managed travel in the UK.

The association representing Global Distribution Systems and online travel agents has filed a formal complaint with the European Commission against Lufthansa, Austrian Airlines, Swiss and Brussels Airlines.

The European Technology & Travel Services Association (ETTSA) claims the airlines have breached key provisions of the EU's Code of Conduct on computerised reservation systems (CRS), through its €16 levy for booking tickets using GDS.

The complaint was filed to the Commission's Directorate General of Mobility and Transport, which holds enforcement powers on the Code of Conduct.

"The only way for travel agents to avoid the discriminatory surcharge is to switch from traditional Global Distribution Systems (GDSs) to an alternative platform controlled by Lufthansa, where only such content is shown that Lufthansa chooses to show," said ETTSA's secretary general, Christoph Klenner.

"In addition to taking travel agencies hostage and forcing them to spend unnecessary resources on the switch to Lufthansa's platform, Lufthansa's move will severely hurt comparison shopping and competition.

"Ultimately, this will lead to a more restricted choice and increased prices for consumers who will become increasingly captive."

"If Lufthansa wants to run a GDS, it needs to follow the rules for GDSs," added Mr Klenner.

"The EU Code of Conduct was designed precisely to prevent abuse by airlines who control GDSs. Therefore, the European Commission has a duty to step up and intervene in the interest of continued transparency and consumer choice."

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