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Airlines up agency debit memos in Europe.

Publication: Business Travel News
Publication Date: 04-OCT-04 		Format: Online - approximately 1242 words
Delivery: Immediate Online Access

Article Excerpt
A new front in the war over distribution costs, with travel management companies and their corporate clients on one side and airlines on the other, has flared up in Europe from the rising use by airlines of agency debit memos. American Express estimates that its own agency debit memos increased by 30 percent in the past two years.

This mechanism, used by airlines to debit TMCs via the International Air Transport Association's bank settlement plan for airfares that have been erroneously underpriced, is "one-sided, bureaucratic and complex," said Alan Coles, chairman of the air working party of the United Kingdom's Guild of Business Travel Agents. Corporate clients support travel management companies' resistance. "This has an impact on the buyer," said Tom Stone, chairman of the Institute of Travel Management of the U.K. & Ireland. "Ultimately, we will end up absorbing the costs through higher overheads."

Although ADMs have been around for decades, objections to them have intensified because the number issued has risen sharply during the past two years. One reason for this is that airlines have automated the process by which they check for...

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