EBAA Renews Calls For Transparency in Charter Contracts

 - September 4, 2020, 7:12 AM

This story is part of AIN's continuing coverage of the impact of the coronavirus on aviation.

Private aircraft charter operators and brokers need to be fully transparent with customers about the terms and conditions for flights to avoid misunderstandings that could undermine consumer confidence, industry experts warned in a September 3 webinar organized by the European Business Aviation Association (EBAA). In May, the group worked with the Air Charter Association (ACA) to jointly publish a document called “Guidelines and Recommendations For Charter Flight Contracting” and EBAA is urging member companies to adopt these so as to ensure consistency.

Adam Twidell, co-chair of EBAA’s Associate Members Advisory Council (AMAC) charter brokers committee and founder of charter booking platform PrivateFly, said the Covid-19 pandemic is encouraging new customers to consider charter services and stressed that it is especially important that contract terms are made completely clear to newcomers. He expressed concern that he has seen some flights advertised on an ambiguous basis, implying that in some cases these might not always be offered by genuine commercial operators.

Committee co-chair Mike Ryan, who is managing director of aircraft asset management consultancy Vikingar, said it hadn’t been easy to get operators and brokers to agree which terms and conditions should go into the EBAA guidelines. He acknowledged that sometimes customers are not fully aware that terms and conditions offered by a charter broker could be different from those of the operator providing the flight, and that this has the potential to spark legal disputes.

Ryan gave two examples where there can be a lack of transparency about charter bookings. With Wi-Fi service, it isn’t always made clear what will be included in the charter rate and what might be charged as extra fees to the customer. Sometimes deicing fees can be added to a bill if an aircraft has repositioned for the booked flight from a location with sub-zero temperatures without the customers being aware of the basis for these charges.

“I’m concerned about the perception that new charter customers might have [if contract terms aren’t clear] and also about how some flights are being advertised,” said Twidell.

Aircraft brokers addressed the challenges of completing transactions in the wake of ongoing Covid disruption. Janine Iannarelli, chair of AMAC’s sales and acquisitions committee and president of Par Avion, described how she has been using Zoom to provide clients with a virtual walkaround of aircraft.

“We’re having to rely more on third parties that we can trust and make case-by-case decisions as to when it’s necessary to travel,” Iannarelli explained. She added that, for now, demand is stronger for small- and medium-sized aircraft than for larger, longer-range jets because owners face such uncertainty as to where they can safely and legally travel.

Valerio Zamboni, founder of Monaco-based broker New Jet International, told the webinar that customers are choosing to buy and sell aircraft in their own country to avoid complications. “The travel restrictions are certainly affecting the European market,” he said.

Marie-Laure Gassier, chair of the AMAC financiers committee and a senior executive with BNP Paribas bank, called for the creation of a single aircraft registry for the whole of the European Union. She said this would improve safety by ensuring greater consistency and also make transactions more straightforward.

During the webinar, which was called "Rethinking Relationships in Business Aviation," EBAA conducted a poll to gauge the attitude of industry participants to the state of the business aviation market. Exactly 50 percent said that, beyond Covid, they see “a lasting positive change and a growing customer base.” However, 31 percent predicted “a prolonged downturn with bankruptcies and consolidation,” and 19 percent said “the crisis will pass and we’ll go back to normal.”

EBAA is running three further industry webinars during September.