Aviation Regulatory Update – December 2024

December 23, 2024

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ICAO ANNOUNCES REVISED LIABILITY LIMITS

The International Civil Aviation Organization (“ICAO”) recently announced its intention to increase the liability limits under the Convention for the Unification of Certain Rules for International Carriage by Air (“Montreal Convention”) with respect to passenger death and injury, passenger delay and lost, damaged or delayed baggage, and cargo shipments.  We recommend that carriers review tariffs, contracts of carriage, websites, e-tickets, and other relevant documentation to ensure any liability language contained therein is updated.  As needed, update regulators and/or file revised tariffs where required (e.g., with CTA and DOT).

These changes will take effect on December 28, 2024.  The applicable changes are detailed in the below chart.

If you require any assistance or have questions regarding the updates, please do not hesitate to contact us.

DOT ANNUAL DISABILITY REPORTS DUE JANUARY 27, 2025

Carriers are reminded that annual disability reports must be submitted to the U.S. Department of Transportation (“DOT”)’s Office of Aviation Consumer Protection by Monday, January 27, 2025.  Reports should include a categorized summary of all disability-related complaints received in calendar year 2024.  If a carrier did not receive any written disability-related complaints in the prior year, DOT nonetheless requires the carrier to submit a zero-report noting that no complaints were received.  Failure to promptly comply with reporting requirements can result in DOT enforcement action.  If you have questions or require assistance to submit the annual report, please do not hesitate to contact us.

DOT LAUNCHES RULEMAKING ON CASH COMPENSATION AND RELATED CONSUMER PROTECTION REQUIREMENTS

On December 5, 2024, DOT announced a long awaited and significant new rulemaking initiative by issuing an Advance Notice of Proposed Rulemaking (“ANPRM”), titled “Airline Passenger Rights.”  The ANPRM proposes changes which would require airlines, when an airline-caused disruption occurs, to pay passengers cash compensation, rebook affected passengers free of charge on the next available flight, and cover expenses (i.e., meals, overnight lodging, related transportation).  Noting that other countries have adopted similar consumer protections compensating passengers when an airline causes a disruption, DOT seeks public comment on several topics including when to consider a cancellation or delay within an airline’s control.  The Department is exploring how to determine which delays and cancellations are controllable, yet doing so presents a herculean task when flight disruptions are often caused by multiple events.  Airlines are encouraged to submit comments to inform the Department’s definition of “controllable” cancellations or delays.  Under the current definition, the below requirements would apply “if a delay or cancellation involves any factor or event within the control of the airline, including its operating partner, and their employees, subcontractors, or other persons working on their behalf.”  In other words, controllable cancellations and delays would be defined as those due in whole or in part to any circumstance within an airline’s control.

The Department foresees that this rulemaking will apply to U.S. and foreign air carriers, but the ANPRM specifically asks for comments on which carriers should be covered if DOT were to issue this rule.  DOT’s current position is that covered entities would include “certificated carriers, commuter carriers, and foreign air carriers operating to, from, or within the United States, conducting scheduled passenger service with at least one aircraft having a designed seating capacity of 30 or more seats.”

The European Union (“EU”) and Canada have similar regulations on the books requiring services and compensation like those proposed in the ANPRM.  For example, the EU and Canadian regulatory regimes limit entitlement to compensation if the passenger already received compensation for the same delay or cancellation in another jurisdiction.  DOT seeks comments on whether the Department should adopt similar limits on compensation when the laws of multiple jurisdictions apply.  To guarantee that passengers can accept a reimbursement, service, or compensation on an informed basis, the Department may require airlines to notify passengers of any differences in value owed under DOT requirements as compared to a foreign jurisdiction’s compensation regime when the laws of multiple jurisdictions apply.  Doing so would require airlines to differentiate the value owed under DOT-imposed requirements from the value owed under the law of a foreign jurisdiction so that passengers can make informed decisions.

DOT is considering the following requirements when there is a cancellation or lengthy delay due to any circumstance within an airline’s control:

• Pay at least $200 in cash compensation:  The ANPRM contemplates a tiered approach where compensation could range from $200-$300 for domestic delays of at least three hours but less than six, $375-$525 for delays of at least six hours but less than nine, and $750-$775 for delays of nine hours or more.

• Rebook at no additional cost on the next available flight: DOT may require airlines to offer free rebooking when a passenger’s flight is cancelled, their departure is delayed three hours or more domestically or six hours or more internationally, or if a delay results in a missed connection.  Airlines could further be required to rebooking passenger on the next available flight operated by the airline or its branded codeshare partners, and if flights on those airlines are not available within 24 hours, then any carrier that the airline has a commercial agreement to transport passengers.

• Cover meals, overnight lodging, and related transportation expenses: Under the ANPRM, airlines could be obligated to provide meals, overnight lodging, and transportation for passengers and may also be required to automatically pay a minimum reimbursement for each service an affected passenger is entitled to receive when an airline does not provide such services upfront.

Please note that this rulemaking is independent from DOT’s refund rule.  It is unclear whether this rulemaking will proceed once President-elect Trump takes office in January 2025.  Comments are due by February 10, 2025, yet the ANPRM notes that late-filed comments will be considered to the extent practicable.

DHS ANNOUNCES TWO RULES TO MODERNIZE H-1 AND H-2 PROGRAMS

On December 18, 2024, the U.S. Department of Homeland Security (“DHS”) announced two final rules to modernize the H-1B program as well as the H-2 program.  Please note that the H-1B program differs from the H-2 program in that H-1B visa are designed for individuals with specialized skills while H-2 visas are for non-professional foreign workers.  To further implement these rules, DHS stated that a new edition of Form I-129, Petition for a Nonimmigrant Worker, will be required for all petitions beginning on January 17, 2025.

For the H-1 program, the final rule revises the regulatory definition and criteria for a position to be deemed a “specialty occupation” to provide greater flexibility for employers.  The final rule also seeks to strengthen the H-1B program’s integrity by requiring an employer to establish that it has a bona fide position in a specialty occupation available for a foreign work as of the requested start date.  The other final rule issued by DHS relates to the H-2 program and intends to provide greater flexibility to H-2A (temporary agricultural) and H-2B (temporary nonagricultural) workers.  The final H-2 program rule adjusts the existing admission periods before and after the validity dates of an approved visa petition.  This modification allows H-2 workers to maintain valid H-2 status for a period of up to 10 days prior to the petition’s validity period and up to 30 days following the expiration of the petition.

AIRLINES FACE BIPARTISAN CRITICISM OVER ANCILLARY FEES

On December 4, 2024, Republican and Democratic senators on the U.S. Senate Homeland Security Committee accused airlines of charging so-called “junk fees” to increase corporate revenues.  Following a recent Senate subcommittee report examining airline fees, executives from American, Delta, Frontier, Spirit, and United testified before a Senate panel defending the industry’s business practices relating to fees.  During the two-hour hearing, senators interrogated airline executives on fee structures with some senators suggesting that ancillary fees are akin to extortion.  While Congressional lawmakers alleged that airline fees are unpredictable and buried from public view, executives countered that ancillary fees such as those for additional legroom or a preferred seat are voluntarily choices made by consumers.  It was further explained to lawmakers that fees are clearly disclosed in the spirit of transparency.  Since fees are disclosed in advance and consumers have the freedom to select certain upgrades, testimony from the executives defended current business practices and countered one senator’s assertion that the airline industry views customers “as little more than walking piggy banks to be shaken down for every possible dime.”  The bipartisan censure of ancillary fees mirrors similar criticism coming from the other end of Pennsylvania Avenue where the outgoing Biden administration continues to crackdown on “junk” fees under the guise of consumer protection.

CHANGES TO APHIS REPORTING AND REMITTANCE PROCESS

Carriers are reminded that changes to the reporting and remittance process for the U.S. Department of Agriculture’s Agricultural Quarantine and Inspection (“AQI”) program became effective on October 1, 2024.  Please be advised that payment for relevant commercial aircraft and international air passenger fees are now due monthly.  There is also a 90-day reconciliation period from the end of the month to when the payment is due.  For reference, a carrier’s October 2024 payment and remittance is due January 31, 2025.  Please see below for current due dates since the reporting and remittance process changed from a quarterly to monthly payment.

FAA GRANTS TEMPORARY SCHEDULING RELIEF AT NEWARK

The Federal Aviation Administration (“FAA”) recently announced temporary scheduling relief at Newark Liberty International Airport (“EWR”) during construction-related runway closures.  While EWR does not have a formal slot usage requirement, the FAA manages airline schedules to reduce congestion among the New York area airports.  Capacity at EWR will be diminished as construction projects are completed in various stages throughout 2025.  The targeted schedule reductions apply to both weekend closures at EWR that will occur from March 1 to April 14, 2025, and September 1 to December 31, 2025, as well as daily closures from April 15 to June 15, 2025.  The FAA envisions that scheduling relief will mitigate delays at EWR, optimize the efficient use of airport resources, and ease the impact on passengers during the upcoming construction projects. 

FAA EXTENDS HAITI FLIGHT RESTRICTIONS UNTIL MARCH 2025

On December 11, 2024, the FAA announced that it will extend flight restrictions on U.S. airlines operating in Haitian airspace until at least March 12, 2025, amid ongoing violence in the region. U.S. airlines were initially banned from flying to Haiti for 30 days after commercial aircraft operated by Spirit, JetBlue, and American were hit by gunfire last month when landing at Toussaint Louverture International Airport in Port-au-Prince.  While the FAA intended to lift Haiti-related flight limitations this month, it decided to prolong limitations until March 2025 even as Haiti’s Toussaint Louverture International Airport officially reopened for commercial flights.  The Haitian government increased security at the airport yet growing gang violence continues to disrupt daily operations.  A “Do Not Travel” advisory has been in effect since earlier this year and the U.S. Department of States strongly advises against travel to Haiti amid the civil unrest.

OFAC ANNOUNCES SETTLEMENT OVER SANCTIONS VIOLATIONS

On December 13, 2024, the U.S. Department of Treasury’s Office of Foreign Assets Control (“OFAC”) settled with C.H. Robinson International Inc. (“Robinson”) for violating sanctions against Iran and Cuba.  Robinson, a Minnesota-based global transportation and logistics company, settled with OFAC after five of Robinson’s non-U.S. subsidiaries provided freight brokerage or transportation services for 82 shipments in violation of the Iranian Transactions and Sanctions Regulations (“ITSR”) and the Cuban Assets Control Regulations (“CACR”).  Following an extensive investigation, OFAC determined that most violations occurred because the five non-U.S. subsidiaries did not properly screen for potentially violative transactions, nor did they use the latest sanctions compliance controls.  One such example included a China-based subsidiary that provided transportation services for a shipment from China to Turkey even though the air waybill clearly denoted an Iranian airline as operating the first leg of the journey to Tehran.  Despite clear sanctions implications, Robinson’s subsidiary staff failed to recognize the potentially violative transactions due in part to insufficient internal controls.  While the maximum civil monetary penalty applicable in this matter was $28,629,270, OFAC opted for a $257,690 settlement amount because the violations were voluntarily self-disclosed, and Robinson promptly implemented remedial measures to prevent future violations.  Companies are advised to establish appropriate compliance controls and trainings, especially with foreign subsidiaries, to avoid potential violations.  Please further note that the ITSR and CACR extend to foreign subsidiaries of U.S. companies and thus imports and exports not involving the United States may still be subject to U.S. jurisdiction.

DHS TERMINATES TRAVEL RESTRICTIONS TO RWANDA

On December 3, 2024, DHS announced that it was terminating travel restrictions applicable to passengers arriving to the United States who recently traveled from or where otherwise present within the Republic of Rwanda.  For flights to the United States transporting persons who recently traveled from or where otherwise present within Rwanda, the arrival restrictions terminated after 11:59 p.m. ET on December 4, 2024.  Inbound passengers with a travel nexus to Rwanda are no longer subject to Centers for Disease Control and Prevention (“CDC”) screening upon arrival at U.S. airports.  Prior to the recent announcement, DHS and CDC were screening individuals with a travel nexus to Rwanda due to a Marburg outbreak.

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This Aviation Regulatory Update is intended to keep readers current on developments in the law. It is not intended to be legal advice. If you have any questions, please contact Evelyn Sahr at 202.659.6622 or esahr@eckertseamans.com; Drew Derco at 202.659.6665 or dderco@eckertseamans.com; Jay Julien at 202.659.6648 or jjulien@eckertseamans.com; or Tyler Myers at 202.659.6642 or tmyers@eckertseamans.com, or any other attorney at Eckert Seamans with whom you have been working.

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Authors

Evelyn D. Sahr

Member - Washington, D.C.

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Drew M. Derco

Member - Washington, D.C.

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Jay Julien

Associate - Washington, D.C.

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Tyler R. Myers

Associate - Washington, D.C.

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