MAY 29, 2007
CSTAR FORWARDS OPEN LETTER TO TRAVEL AGENTS FROM CTAC
“Concerned Travel Agents Coalition” Express Worry about IATA PAD
CSTAR, the Canadian Standard Travel Agent Registry, yesterday afternoon transmitted
an open letter to all travel agencies on behalf of the Concerned Travel Agents Coalition
(CTAC). Its contents display CTAC’s concern about the upcoming changes IATA has
planned with the Pre-Authorized Debit (PAD) Agreement with BSPlink. CTAC will be
holding a meeting on Monday, June 4, 2007 and are encouraging travel agents to attend
and discuss the issues. The full text of the open letter will follow.
28 May 2007
Urgent Meeting in Toronto on Thursday, 07 June 2007
Dear Fellow Travel Agents:
We the undersigned travel agents are deeply concerned about the impending changes
planned by IATA which will forever alter, for the worse, our ability to sell airline tickets
in Canada. You have no doubt seen the Pre-Authorized Debit (PAD) Agreement which
IATA wants us to sign, and the new audit and financial requirements which have also
been announced last month. While both ACTA and CSTAR have different views on these
critical issues, we, the travel agents of Canada, will have to live with the outcome of
IATA's mandate, and for most of us, this would have dire consequences on our
Unless we take immediate steps to address these issues, it is our sincere belief that as a
result of IATA's current plans:
1. The new audit requirements will force most every travel agency in Canada to maintain
financial surety and guarantees with IATA - today $10,000.00, but ever- increasing year-
after-year. We will soon have to make personal guarantees, collateralize cash in GICs or
bonds, or even pledge our homes.
2. The new PAD Agreement will allow IATA to move to daily reporting and remitting,
permitting IATA to debit our bank accounts for whatever amount IATA wants and
whenever IATA chooses.
3. BSPlink and the new functionalities approved by IATA such as "fee/charges codes" for
airline tickets to facilitate carriers passing on distribution costs including ticketing fees,
GDS fees, credit card cost recovery fees, and other distribution-related costs, provide the
airlines and IATA with more tools to offload costs on us and to enable carriers to take
market share from Canadian travel agencies.
4. IATA's easier and faster access to our cash will allow airlines to remove our use of the
airlines' merchant agreements for credit card sales, forcing travel agencies to become the
merchant in credit card transactions, thereby creating a "cash-only" form of payment
system between airlines and travel agencies. While our customers will still be able to use
their credit cards, we will have to process the transaction on our own merchant systems
and remit the cash to the airlines. None of us could afford to absorb the merchant fees and
passing these costs on to our clients will be nearly impossible. For many agencies, this
would be the end of airline sales via BSP and our GDSs.
We are not alone in these beliefs. The American Society of Travel Agents (ASTA) is
meeting with its top-tier members in Washington, DC on 11 June 2007 to address many
of these same issues. No one can ignore this grave situation.
- We are not prepared to accept IATA's terms.
- We are not prepared to surrender reasonable, equitable, and long-standing business
- We are not prepared to lose the investment in our travel agency businesses.
- We are not prepared to turn-over our clients to airline direct sales.
Accordingly, we are asking every travel agency which can, to join us in Toronto for a
most important meeting:
Date: Thursday, 07 June 2007
Location: Park Plaza Hotel Toronto Airport
33 Carlson Court
(Adjacent to Pearson International Airport, off Dixon Road at Attwell Drive)
Toronto, Ontario M9W 6H5
Shuttle Service: From/to YYZ available at arrivals area in Terminals 1 and 3
The objective of the meeting is to fully discuss these crucial matters, determine our
options, prepare a strategic response, and to protect our businesses. Both ACTA and
CSTAR were invited to express their views on these important matters.
While CSTAR has accepted our invitation, ACTA has advised that it will not participate.
The substance of ACTA's reply is that it does not believe IATA is moving to daily
reporting, it believes the PAD Agreement clarifies various issues for all stakeholders, it
believes that the new financial and audit requirements are in line with similar
requirements in provincially-regulated jurisdictions, and most surprisingly, ACTA has
advised that it does not understand how agencies entering into cash sureties and
guarantees with IATA will pave the way for a cash-only BSP Canada remittance system,
even though we clearly laid out this eventuality in our letter and invitation to ACTA.
ACTA has also stated that another reason that it cannot attend our meeting on 07 June
2007 is that ACTA is "quite busy" organizing its AGM and Atlas Awards Gala (to be
held on 02 June 2007).
A copy of our invitation to ACTA is available by clicking here.
A copy of ACTA's decision not to attend is available by clicking here.
It is most important to understand that ACTA itself proposed the new financial audit and
standards requirements to IATA, and it was ACTA which consulted with IATA on the
development of the PAD Agreement. ACTA's proposal to IATA will be voted on by the
airlines at the IATA Passenger Agency Conference in Geneva on 13 June 2007, and it is
critical that ACTA understand the consensus of agencies across Canada before the
meeting in Geneva takes place. While it is our feeling that ACTA should withdraw the
proposal before it is too late, we wanted to give ACTA every opportunity to explain its
position so that we could understand why it would propose such requirements. ACTA's
unwillingness to discuss these issues directly with agencies is of the greatest concern to
all of us.
We call on ACTA members to persuade ACTA to change its mind and to accept the
invitation to participate at the meeting on 07 June 2007. Nothing could be more important
than addressing these serious issues. Please contact your local ACTA officials or ACTA
President Christiane Théberge directly (email@example.com).
CSTAR has agreed to assist us in the facilitation of this meeting and is managing
distribution of this message and confirmations for attendance. As we wish to assure
sufficient facilities to accommodate all those who wish to attend, please confirm your
intention to participate no later than close of business, Monday, 04 June 2007 by sending
an e-mail to: firstname.lastname@example.org
Well-managed travel agencies have survived commission cuts, 9/11 and many other
challenges over the years - the question now is whether we can survive BSPlink, PAD,
and the proposed financial terms of IATA Resolution 800f.
Please make the time to attend. Our future depends on it.
CTAC Steering Committee