US to propose new rules requiring refunds for delayed airline bags - source

The Biden administration will soon propose new rules to require passenger airlines to refund fees for bags that are significantly delayed and refunds for services like onboard Wi-Fi that does not work, a source told Reuters.

Under existing Transportation Department rules, passengers are entitled to a fee refund if bags are lost, but not when delayed. Under the proposed Transportation Department rule set to be released in the coming days, a "significantly delayed checked bag" is one not delivered to the passenger within 12 hours for domestic itineraries and within 25 hours for international itineraries.

The administration proposal would also require airlines to promptly refund fees – such as for advance seat selection, Wi-Fi and other flight services – if the passenger does not receive the service or it does not work.

US airlines collected approximately $5.8 billion in baggage fees and $2.8 billion in change and cancellation fees in 2019, up from just $464 million in baggage fees and $915 million in change and cancellation fees in 2007.

The Biden administration is holding a call on Friday to discuss the issue with major airlines, two other sources said.