New Department of Transportation (DoT) regulations aim to make air charter broker services more transparent to the consumer. The rules, known as Part 295 or “Increasing Charter Air Transportation Options”, came into effect earlier this year. One of the goals of the DoT is to “strengthen the legal protections provided to consumers of charter air transportation” while also “facilitating innovation and growth in the air charter industry”.
Prior to these new rules, there was no Federal Aviation Administration (FAA) or DoT regulation of charter brokers. Literally anyone can establish themselves as an air charter broker, even if they have no experience or might have prior criminal convictions. This is in stark contrast to other industries such as real estate or insurance where brokers must be licensed or certified. While the new regulations still do not require licensing or establish any kind of registry, many in the aviation industry welcome the changes as a step in the right direction, and one which will benefit both the consumer and the legitimate broker. Adam Hohulin, VP of Operations at Sentient Jet says, “We welcome the new DOT regulations and are encouraged by these first step at regulating our Air Charter Broker industry.” He calls them “a pivotal moment in private flight that will surely spearhead a new and improved standard across the industry.”
Tighter regulation of the private air charter broker industry has been a topic of discussion for some time. In February 2005, a chartered Bombardier Challenger overran the departure runway at New Jersey’s Teterboro airport as it took off for Chicago Midway. The plane not only crashed through the airport perimeter fence; it also crossed a 6-lane highway and ran through a parking lot into a warehouse. Somewhat miraculously there were no fatalities. However, the two pilots and two passengers in a vehicle on the highway were seriously injured, with cabin crew and the aircraft passengers also receiving minor injuries.
In the course of the National Transportation Safety Board (NTSB) investigation, a number of problems were uncovered, including the failure of the flight operator to ensure proper certification and compliance with FAA regulations. The report noted that there was an “environment conducive to the development of systemic patterns of flight crew performance deficiencies.” One member of the investigation board expressed concerns that while charter brokers are “the face of on-demand air travel” within private aviation, they are “essentially unregulated”. While the client assumes the broker has checked all safety and operational requirements, in reality, there were some brokers who knew little about the operators with whom they did business. This, the NTSB concluded, was a loophole within the FAA system that needed to be closed.
Under the terms of the new regulations from the Department of Transportation, air charter brokers must now make certain disclosures to the client so that their business operations are more transparent. Key among the requirements is that brokers must make it clear to the consumer that they are middlemen in the business transaction of booking the private aircraft. They must disclose both who owns the plane being used, and which company operates it. Liability insurance, any existing business relationship between the broker and the operator, and all total fees must also be disclosed. This transparency is no longer an option but a mandate. This is good news for companies who have been successfully operating as reputable charter brokers and even better news for the air charter customers.
Hohulin says:
At Sentient Jet, we embrace the fact that we are one of the world’s largest Air Charter Brokers and have been guided by the very principles of safety and transparency that are being implemented through the new regulations, and we’re pleased to see that these measures are now being standardized throughout the industry.
David McCown, President of Air Partner US, and a former Chairman of the Air Charter Association of North America, is among the group of large brokers who welcome the new regulations. He told us:
The DOT Part 295 is a welcome step for the broker community as it finally clarifies the requirements by which brokers conduct business [and any entity engaging in brokering flights i.e. air charter operators]. Having this in place helps to both strengthen the role of the broker in the aviation industry and the transparent aircraft operational control to end-users.
The new regulations are seen as a clear step forward in providing industry transparency and a better standard of consumer protection. Hohulin notes that failure to comply with DoT Part 295 can result in “a complete refund to the customer and additional fines levied against the Air Charter Broker as outlined in the regulation.”
For consumers who use a broker to arrange a private air charter, the DoT rules now offer clear protections. Your broker should make it abundantly clear that he is acting as a broker, and should be providing you with plenty of information about who owns the plane, who operates the plane, and more. Reputable air charter brokers have long been doing all of this, which is why they are pleased to now see this enforced as the standard. An experienced broker can help to save you money when booking a flight and can ensure that you are flying safely. For more advice on finding a broker, see the earlier article on How to Find a Jet Charter Broker.