Part 135 Transparency

USDOT Seeks Increase in Part 135 Transparency

Both the FAA and the U.S. Department of Transportation, Office of the Secretary (OTS) have been increasing their regulatory scrutiny of arrangements where one party's Part 135 operating certificate is used, either to cover the operations of another party's aircraft, or to allow a broker to sell seats to consumers.  Deals where one party "rents" the use of another party's certificate are deemed violations of the Federal Aviation Regulations (FAR).  Similarly, deals where an air charter broker with no 135 certificate holds itself out to be a carrier violate the DOT economic regulations.  To pass under the FARs, a 135 deal must involve close supervision by the certificate holder over the pilots working for the second party.  To pass under the DOT regulations, a charter broker must have written agreements with either the carrier or the customer or both, authorizing it to serve as agent in procuring flight services or customers.
The U.S. Department of Transportation is now spearheading a push for increased transparency in the marketing of flight services under FAR Part 135.  In the past few years, there have been accidents in cases where the customers did not know what operator was actually flying them.  The NTSB, which investigated the accidents, recommended that the DOT issue regulations requiring a number of disclosures to be made for every Part 135 flight.  These would include the name of the party in operational control of the flight including all its DBA names; the name of the aircraft owner; and the name of any broker involved in the flight. 
On January 26, 2007, the DOT published a notice in the Federal Register requesting comments from the industry and the public on the NTSB recommendations.  Drafts of proposed regulations were not provided.  Any comments were to be filed by March 27, 2007.  The DOT is seeking comments on all aspects of the potential new regulations, and especially the following:
  1. How might customers and passengers benefit from the information covered by the NTSB recommendation in making their air taxi service purchase decisions?   
  2. Should any notice requirement, if adopted, also apply to air charter brokers and other ticket agents who arrange for air transportation for customers using the services of on-demand air taxis?   
  3. To what extent is each of the notices recommended by the Safety Board already provided in the normal course of business to persons who travel using an on-demand air taxi?  If such notice is not currently routinely provided, what, if any, practical difficulties would the on-demand air taxi industry likely face in providing the notice?
  4. What costs, if any, would the recommended changes impose on the industry?  Would there be any paperwork burdens?  Would there be a significant economic impact on a substantial number of small entities?   
  5. How might the disclosure of the names of the owners of the aircraft involved in the arranged flights be useful to customers and passengers?  What, if any, practical or privacy concerns would be raised by such a requirement?   
  6. At what point in time must any notice, if required, first be provided to be effective, e.g., in printed and website advertisements, to potential customers when they are seeking information, anytime prior to entering into a contract, upon signing the contract, or anytime prior to boarding the aircraft?   
  7. What form should any notice requirement, if adopted, take?  That is, is verbal notice sufficient or must the notice be in writing?   
  8. What are the practical problems in requiring notice to individual passengers of an on-demand air taxi?  Would any notice requirement be sufficient if provided to the person contracting for the flight, e.g., the customer's broker/agent or a corporation's travel department or an executive's assistant who arranged the flight?
The DOT’s notice of January 26 solicited comments. The NTSB recommendation letter to DOT is also available for viewing. 

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