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InternationalAirTransportAssociation IATA Centre, Route de lAroport 33P.O. Box 416CH-1215 Geneva 15 Airport,Switzerland

In 2001, after learning that DG COMP was considering adding anobligation to collect interline statistics, demonstrating the degree and

extent of interlining within the European Economic Area (EEA), a numberof tariffs and statistical experts met with IATA to determine what could becollected and how.

Difficulties had been experienced in previous attempts to quantify thelevels of interlining for a number of reasons, including because airlines

used different accounting systems, different standards and differentdefinitions. For example very few airlines used a definition of Europe thatmatched the geographic definition of the EEA. As a result much of what

had been produced only resulted in what has been called an apples to

oranges comparison.The economist, who had worked with IATA in preparation of its responseto the 2001 consultation, also participated in the discussions. Theconclusions of the experts were:

In their view, the objective was best accomplished by each airline

analysing how its customers were using the coupons of its owntickets. If the accounting records indicated that a passenger hadflown on its own services, the flight coupon would be counted asbeing flown. If the airline had been billed by another airline for the

flight coupon, that coupon would be counted as billed and this wouldevidence interlining.

DG COMP was looking for statistics related to passengers travelling at

fares applicable between two points in the EEA. The airlines wouldtherefore need to exclude all tickets that were not for transportationsolely between points in the EEA. For example all flight coupons of aticket from Lyon to Brussels to New York would need to be excluded.

At the request of one participant, to make the data selection processeasier, it was agreed to limit the analysis to tickets that had beenissued in the EEA.

It was not possible to distinguish between IATA special fares and

carrier special fares. Airlines heretofore had no reason to distinguish

between IATA and carrier fares and there was no ticket entry, ordata record on a ticket or in a reservations record that had indicatedwhich had been chosen by the passenger. However for normal

fares, it was possible to distinguish between the fully flexible faresestablished in IATA and those established by individual airlines as

these fare types could be distinguished by the fare basis code thatwas included on all tickets. An IATA normal fare would almost alwaysbe coded Y or C or D while a carrier-restricted normal farewould likely bear a code such as Y2 or C57 or DxxRT. The

economist observed that the concerns conveyed in the Commissionsconsultative paper focused more on business, or normal fare, travel

and therefore an analysis of normal fare traffic would demonstratethe value and need for the IATA interline product.


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It was believed that it would be feasible for many of the European

airlines to provide statistics on this basis.

The Detailed Description which follows was presented to DG COMP inJanuary 2001 by IATA and the group of experts for their agreement. It ison this basis that the participating airlines have prepared the interline

data submitted to DG COMP at the agreed intervals.

Three minor updates have been made since January 2001:

1. The definition of the EEA now refers to 25 European Union states,rather than 15, beginning with the data collection period commencing

July 2004.2. With the agreement of DG COMP the reporting periods set out in

Paragraph 4 have been changed from April September and October

March to January June and July December.3. As requested by DG COMP, IATA would also supply, in addition to the

total numbers of all reporting airlines, on a confidential basis the data

supplied by each reporting airline in early May and early November.

IATA Government and Industry Affairs

October 2004


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020125report.doc tlb

Detailed DescriptionDetailed DescriptionDetailed DescriptionDetailed Description

Definitions:Definitions:Definitions:Definitions:

EEA (European Economic Area)EEA (European Economic Area)EEA (European Economic Area)EEA (European Economic Area) The 25 European Union States, plus Iceland,Liechtenstein, Norway, and, due to the soon to be implemented bilateral accords,Switzerland.

Within the EEAWithin the EEAWithin the EEAWithin the EEA - a ticket for an itinerary, other than a wholly domestic itinerary, for which allfare construction points are in the EEA.

InterlineInterlineInterlineInterline Evidenced when an airline bills another airline for its flight coupons.

IATA Normal FaresIATA Normal FaresIATA Normal FaresIATA Normal Fares IATA fares governed by Resolution 062a (Economy Class Fares) andResolutions in the 095 series (Budget, Eurobudget fares).

Carrier Normal FaresCarrier Normal FaresCarrier Normal FaresCarrier Normal Fares Flexible fares without i) minimum/maximum stay requirements, or, ii)penalties, fees for rebooking or rerouting (an amount paid in upgrading to a higher fare is notconsidered a penalty or fee).

ProcedureProcedureProcedureProcedure

1 For flight coupons of own tickets issued in the EEA, analyse those for which all Fare

Construction Points are within the EEA,1.1 Identify and count all own flown coupons, at which travel was at a Normal fare,

1.2 Of 1.1, identify and count those at which travel was at an IATA Normal fare,

1.3 Identify and count all billed coupons, at which travel was at a Normal fare,

1.4 Of 1.3, identify and count those at which travel was at an IATA Normal fare.

2. For flight coupons of own tickets issued in the EEA, having a fare component (one way orround trip) between (24 identified origin/destination markets).

2.1 Identify and count all own flown coupons, at which travel was at a Normal fare,

2.2 Of 2.1, identify and count those at which travel was at an IATA Normal fare,

2.3 Identify and count all billed coupons, at which travel was at a Normal fare,

2.4 Of 2.3, identify and count those at which travel was at an IATA Normal fare.

3 Report for each of 1 and 2 the following:

3.1 The total number of passenger trips (1.1 + 1.3 and 2.1 + 2.3)

3.2 The number of passenger trips at an IATA normal fare (1.2 + 1.4 and 2.2 + 2.4)

3.3 The percentage of passenger trips at an IATA normal fare (3.2 3.1 x 100)

3.4 The number of passenger trips at an IATA normal fare which were interlined (1.4 and2.4)

3.5 The percentage of passenger trips at an IATA normal fare which were interlined(3.4 3.2 x 100)

4. Reports to be sent to IATA each April and October covering coupons used or billed duringthe previous July - December and January June periods.

5 IATA will report individual airline results on a confidential basis to the EC together withindustry totals in early May and early November.


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Flight Coupons of own tickets issued in the EEA,

and with all Fare Construction Points within the EEA (1)

AND

Own flown coupons, at which travel was Billed coupons, at

at a Normal Fare (1.1) which travel was at

a Normal Fare (1.3)

AND

Own flown coupons, at which travel Billed coupons, at

was at an IATA Normal Fare (1.2) which travel was at

an IATA Normal Fare

(1.4)

EQUALS:





a Normal Fare (1.3)



an IATA Normal Fare

(1.4)

Report:

The % of passenger trips at an IATA Normal Fare ((1.2+1.4)/(1.1+1.3)x100

The % of passenger trips at an IATA Normal Fare which were interlined 1.4/(1.4+1.2)x100


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Flight Coupons having a fare component (one way or round trip)

between (20 identified origin/destination markets) (2)

AND



a Normal Fare (2.3)

AND



an IATA Normal Fare

(2.4)

EQUALS:



Flight Coupons having a fare component (one way or round trip)

between (20 identified origin/destination markets) (2)



a Normal Fare (2.3)



an IATA Normal Fare

(2.4)

Report:

The % of passenger trips at an IATA Normal Fare ((2.2+2.4)/(2.1+2.3)x100

The % of passenger trips at an IATA Normal Fare which were interlined 2.4/(2.4+2.2)x100

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