29 amp 30 March 2017 Geneva Switzerland Welcome Introduction and Welcome Marco Alvarenga Head Airline Participation Management IATA Housekeeping Toilets Coffee machines Lunch options ID: 605502
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Slide1
ZMF AGM 2017
29 & 30 March 2017Geneva, Switzerland
WelcomeSlide2
Introduction and Welcome
Marco Alvarenga
Head Airline Participation Management
IATASlide3
Housekeeping
Toilets
Coffee
machines
Lunch options
WIFI & laptop usage
Dinner
TimingSlide4
New Members
4
ZMF AGM 2017 – Geneva
Who’ve joined since last AGMSlide5
5
New Full Member:
Abidjan – Ivory Coast
HF flies with Airbus 320/319 and regional Dash8 to
Destinations in West & East Africa Slide6
6
New Full Member:
Lisbon – Portugal
YU flies schedule with Boeing 767/777 to Bissau (Guinea-Bissau)
and also Charter/Wet Lease. Slide7
7
New Full Member:
Bern – Switzerland
SX flies schedule with Dornier 328 & Saab 2000 to Destination
Switzerland – Europe e.g BRN-MUC or BSL-LCY Slide8
8
New Full Member:
Florida – U.S.A
VC
positioned their aircraft throughout the continental
US for scheduled routesSlide9
9
New Full Member:
Lisbon – Portugal
WI
flies charter & wet leased with Boeing / Airbus &
ATRSlide10
10
Associate Member:
Dublin – Ireland
RE wet leased specialist operates scheduled services
in Europe on behalf Aer Lingus Regional & FlybeSlide11
11
New associate Member:
Hamburg – Germany
AHO flies world wide executive charter with private
jets. Slide12
Members are invited for concurrences .
12Slide13
Introducing our Meeting Sponsors
myIDTravel
ID90T
IBSSlide14
Financial Statement
14
ZMF AGM 2017 – GenevaSlide15
Financial StatementSlide16
Financial StatementSlide17
A Tribute to ThierrySlide18
Voting Papers
18
ZMF AGM 2017 – GenevaSlide19
Voting Papers
ZED Lower baseline
ZED Super Low
AGM Networking Event
Tax Collection
Chargebacks
Ticket Validity
Definition of Nominees
Your ZMAC
AGM 2018Slide20
Voting Paper
ZED Lower Baseline Slide21
Situation
Currently (approved AGM16) fares are constructed using two baselines:
Economy Space available LOW zone 1
Economy Positive space LOW zone 1
The
evolution (increase or decrease) is calculated using the yearly figures provided by IATA:
ACTUALS
ACTUALS
2013
2014
2015
Passenger yield previous year N-1
-5,5%
-11,7%
Jet fuel
price
$/
bbl
124,5
114,8
66,7
Jet fuel price (IATA source- N-1 vs N-2)
-7,8%
-41,9%
Fuel % expenses (IATA sources)
32%
27,5%
Calculated % evolution
-23,2%Slide22
As from such
c
alculated
% evolution
and using those two baselines, all
ZEDMIBA
Fares are calculated on a yearly adjustment process
Economy
/ Premium Economy/
Business
Space Available/Confirmed
At the AGM 2016, following was agreed:
“
The lowest adult fare for space available fare type in Economy may never fall below
15 USD in order to maintain a minimum revenue for the operating carrier.”Slide23
ZED Space Available – Economy Class FaresSlide24
ZED Space Available –
Business
Class FaresSlide25
ZED Space Available –
Premium Economy Class FaresSlide26
Problem
Looking at the
IATA forecast values for 2016, we
can foresee to have
a decrease on ZEDMIBA fares for 2017.
However, because
in Nov 2016 we voted to have
Economy Space available LOW zone
1
to be the
lowest possible fare
of
15.00 USD, all related Space available fares constructed from that baseline will not decrease at all. They will be identical to what we have today.Slide27
3 options
Do
nothing
and keep the
15USD
as the lowest fare possible for
Economy Space available LOW zone 1.
Set
the lowest adult fare for
Economy space
available fare
for Economy to
13USD
Set no minimum fare at all, like for positive space fares.Discussion on Pros and Cons
Slide28
Voting Paper
ZED Super Low Slide29
ZED and MIBA fares: where do we come from
29
2011-2012:
Workshops conducted to determine :
What is a fair value for ZED R2 fare? what would be the minimum ZEDR2 (ZL) fare which an operating carrier would agree to be acceptable to offset its operating costs?
No agreement reached
yet
within
the industry
What is a fair
value
for confirmed fare? ZMAC offered to outsource to a third party the assessment of market fare levels (research on all GDSs with similar fare conditions). This solution had a cost and was not retained by members.
ZEDR2 Medium was then retained as the industry standard (used by the majority of carriers): 2012 ZMR2 levels were used as a starting point and became the central reference on which ZL and ZH is being calculated
ZEDR1 and MIBAS1-C1 fares were “merged”: same reference whether it is leisure or duty. 2012
levels were used as a starting
point: R1 for Low, S1 for Medium and High levels
2016-2017:
Levels of fares are being questioned again by ZEDMIBA members.
If
the
yearly
fare
adjustment
drops
below
the
minimum
ECO
baseline
fare
,
there
is
no
movementSlide30
Market prices Mileage
zone 1: examples
Current ZED fares:
RT ZEDR2 Medium without taxes: 2*24
=
48 $,
ZEDR2 Low:
2*15
=
3
0
$
RT ZEDR1 Medium
without
taxes: 2*62 =
124 $,
ZEDR1 Low:
2*28
=
56 $
Public
fares within mileage zone 1:
2 weeks prior to
departure (MAR’17)
PAR-NCE/ Easy Jet:
:
Public fare:
86 $
RT fare,
without airport taxes
No
refund, no changes,
1x luggage incl.
TYO-OSA/
flyPeach
:
Public fare:
87 $
RT fare,
without airport taxes
No
refund, no changes,
1x luggage incl.
NYC-BOS/ Delta-Jet Blue- AA:
Public fare:
108 $
RT fare,
without airport taxes
No
refund,
no changes, 1x luggage incl.
Lower
than
ZEDMIBA R1 on MM
Lower
than
ZEDMIBA R1 on MM
Lower
than
ZEDMIBA R1
with
MMSlide31
Market prices Mileage
zone 3: examples
Current ZED fares:
RT ZEDR2 Medium without taxes: 2*39
=
78 $
,
ZEDR2 Low:
2*29
=
58
$
RT ZEDR1 Medium
without
taxes: 2*118=
236 $
,
ZEDR1 Low:
2*53
=
106 $
Public
fares within mileage zone 3:
2 weeks prior to
departure, non-stop flight (MAR ’17)
FRA-IST/ Pegasus Airlines :
Public fare:
55 $
RT fare,
without taxes
No
refund, no changes,
1x luggage incl.
SIN-DPS/ Tiger Air:
Public fare:
126 $
RT fare,
without taxes
No
refund, no changes,
1x luggage incl.
GIG-BUE/ EMIRATES:
Public fare:
239 $
RT fare
,
without taxes
No
refund,
no changes, 2x luggage incl.
Lower
than
ZEDMIBA R2
with
ML!!!
Close
to
ZEDMIBA R1
with
MM
Lower
than
ZEDMIBA R1
with
MMSlide32
Market prices Mileage
zone 6
: examples
32
Current ZED fares:
RT ZEDR2 Medium without taxes: 2* 79
=
158 $
,
ZEDR2 Low:
2*59
=
118
$
RT ZEDR1 Medium
without
taxes: 2*248=
496
$,
ZEDR1 Low:
2*163
=
326 $
Public
fares within mileage zone 6:
2 weeks prior to
departure, non-stop flight (MAR ‘17)
CGN-MIA/
Eurowings
:
Public fare:
400 $
RT fare,
without airport taxes
No refund, no changes, 1x luggage incl.
BKK-MEL/ Jet Stars:
Public fare:
318 $
RT fare,
without airport taxes
No refund, no changes,
1x luggage incl.
MAD-SDQ/ Air Europa:
Public fare:
647
$
RT fare,
without airport taxes
No refund,
possible changes, 1x luggage incl.
Lower
than
ZEDMIBA R1
with
ML!!!
Lower
than
ZEDMIBA R1
with
MMSlide33
What
happened
after
our
workshop
in Sep 2016?
Isabelle from Air France gathered some information
Inhouse
pricing
scheme
from
SWISS in
October
Isabelle prepared an excel sheet with the actual ZED MIBA fare level compared with the SWISS inhouse fares
Isabelle, Ingo (LX) and Axel (LH) scheduled a conference call for end of November
We discussed the possibility of using the
L
X inhouse fares
We decided to evaluate the proposal and compare it with commercial fares from some airlines
Where
are
we
now
?
Working
group
meeting
in MIA
prepared
a
voting
paper
Keep
the
fares
simple &
continue
with
actual
fare
scheme
We
defined
a
feasible
ZED Super Low
fare
scheme
We
defined
the
possible
new
farebasis
code
e.g. YID
ZS
R2…
We
identified
all
necessary
changes
in
the
different ZEDMIBA
documentsSlide34
Proposal
for
the
new
fare
levels
(I)
Space
available
– Economy ClassSlide35
Proposal
for
the
new
fare
levels
(II)
Space
available
– Premium Economy ClassSlide36
Proposal
for
the
new
fare
levels
(III)
Space
available
– Business ClassSlide37
Proposal
for
the
new
fare
levels
(IV)
Positive Space – Economy ClassSlide38
Proposal
for
the
new
fare
levels
(
V)
Positive Space – Premium Economy ClassSlide39
Proposal
for
the
new
fare
levels
(VI)
Positive Space – Business ClassSlide40
Considerations
Worldwide standard
option for airlines who wish to agree
on
a lower
fare level
A
new
product
within ZEDEasy typical ZED fare structureNo complex fare schemeIn connection with the actual fare scheme
Easy to add to existing agreementsA valid option, if fare adjustment rule for ZED LOW does not go below 15USD (minimum level) May not be needed by all airlinesNew fare basis myIDTravel & other tools need an updateISTA & Concurrence form need an update. Cost to Infonia and possibly myIDTravelRevenue loss –
fix costs covered?If baseline is removed there a risk of not meeting the transportation costATPCO must be filed
Fare adjustment mechanism must be updated
Slide41
Action
and
choices
now
!
Evaluate for the ZEDMIBA community if the Super Low Fare Level is necessary?
Are
there
any
open
questions
/
items
or concerns, please
ask
now
?
Always
keep
in
mind
it
is
not a must
to
use
or
implement
,
it
is
only
another
possibility
to
choose
from
our
ZED
product
range
Please
vote
and
be
a
part
of
the
community
to
move
ideas
forward
Slide42
Voting Paper
Networking EventSlide43
43
Situation
Members agree that a networking event an essential part of the AGM. Previous events have been sponsored, and if not, a vote was held to authorize the use of ZMF funds.
At the Boulder AGM 2016, Members suggested that we incorporate a clause into the ISTA, thus removing the
need to request authorization each time by vote.
However, the release of funds will always to be subject to a there being a minimum balance of USD 50,000 in the ZED MIBA Forum account.Slide44
44
PROPOSAL
The proposal is to add the following clause to ISTA Financial section 10.:
A.10.h. The Advisory Council may access ZMF funds to organize a networking event held in conjunction with the Annual General Meeting, limited to
USD 15,000.00
per year and only if available (unspent) funds are not less than
USD 50,000.00Slide45
45
VOTING question
Do you agree to add A 10.h to ISTA
a) Yes
b) No
As this is a financial issue, 67% majority is required for the vote to be approved. Slide46
NEXT STEPS
If we reach the 67% majority, ZMAC will take action and add this clause to ISTA to secure the networking events at any future AGMs.
If we do not reach the 67% majority, no further
steps
will be taken and this issue will be closed.
MANY
THANKS FOR YOUR ATTENTIONSlide47
Voting Paper
ZPA vs. ZPUSlide48
Special
conditions may be bilaterally agreed between
members, however it is common practice
that
the Travel
Partner is to
travel
accompanied by the
employee/retiree. It is
clearly stated on the PTC definition beyond any doubt.
Having such policy in place
avoids
the possibility of fraud – employees/retirees selling their ID tickets.
ZPAAccompanied travel partner of employee/retiree - Adult
ZPC
Accompanied
Travel partner of employee/retiree- Child
ZPU
Partner
Unaccompanied
Info
available
-
http://www.zedmiba.org/fares-filing-list-of-ptcsSlide49
Also
, on the ISTA agreement, if we accept Travel Partners we only have to insert the ZED Fare Level, there’s no mention for the
ZPU
– then we have to assume that by default all concurrences are to be treated as
ZPA
or
ZPC
- Accompanied travel partner of employee/retiree
.
STANDBY
YR2
YS2
CR2
CS2
DEADHEAD Crew
Employee
(ZM)
(00)
(ZM)
(00)
Retiree
Spouse
Child
(age 0-2/
Infant
)
Child (age 2-12/Child)
Child (age 12- under 24)
Child (age 24 and over)
Parents
Sibling
Travel Partners
Info
available
-
http://www.zedmiba.org/ista-appendix-concurrence-form
Eligible Persons (Agreement Section B.1) and Applicable Fare Levels (Appendix Fares)
Fare levels shown in chart are for example purposes only. Members may bilaterally agree to any zonal or discount fare level.Slide50
Problem
Once the employee/retiree is validated on the NIET tool myidtravel,
it is
possible to book/issue
tickets for
ZPA
to travel alone - in spite of the agreement
having been
correctly uploaded with the PTC
ZPA (
Accompanied
) instead of ZPU (Unaccompanied).The validation should be at the level of myIDTravel at the time of the booking/issuance,
that is why we have different
types
of PTC’s.
A provider currently offers an
add-on
at a cost to validate
ZPA
from traveling
Unaccompanied.
Paid add-ons
should not be offered for
standard matters,
but
only for matters requiring a customization. Here this is not the case.
Since
the majority of ZEDMIBA members
are NIET
carriers, and assuming that they have no intention to pay LSY an
add-on, the provider is required
to comply with a ZEDMIBA basic detailed on Appendix Passenger Type Codes (PTCs)
/ Ticket
Designators. Slide51
Currently“Travel Partner - any one person recognized as a travel partner by the employing airline. In the case of more than one travel partner being allowed, it should be bilaterally agreed.”
Proposal
“Travel
Partner - any one person recognized as a travel partner by the employing airline. In the case of more than one travel partner being allowed, it should be bilaterally agreed.
Travel Partner must be accompanied by the Employee/Retiree on all flights unless bilaterally agreed
.”
VotING
QUESTION
Do you agree on the proposal to change the definition?
YesNoSlide52
Voting Paper
Tax CollectionSlide53
53
Slide54
54
Slide55
55Slide56
56Slide57
57Slide58
58
The rulesSlide59Slide60
Voting paper proposal
Add
verbiage to ISTA section C.1.c. and C.2.c. clarifying that transit exempt taxes must be collected on ZED and MIBA tickets (except where an NIET agreement exists and the ticketing/transporting airline unilaterally choses to exempt them), regardless of whether an immediate connection or stopover is intended
.
Slide61
C.1.c.
Taxes/Fees/Charges
C.1.c.i Applicable
interlineable
taxes/fees/charges must be collected and shown on the ticket.
This includes transit-exempt taxes, regardless of whether an immediate connection or stopover is intended.
C.1.c.ii Any tax, fee, or charge imposed by an airline (i.e., charges that are not remitted to a third party government or airport authority, such as YQ, YR and Q charges) must not be collected and shown on the ticket, and must not be collected from the passenger by the Transporting Airline at the time of check-in, unless bilaterally agreed specifically for industry discount tickets.
Slide62
C.2.c.
Taxes/Fees/Charges
C.2.c.i With the exception of an administrative or ticketing handing fee, any tax, fee, or charge imposed by an airline (i.e. charges that are not remitted to a third party government or airport authority) must not be collected from the passenger by the Transporting Airline, unless bilaterally agreed specifically for industry discount travel.
C.2.c.ii The ticketing carrier may collect transit exempt taxes, regardless of whether an immediate connection or stopover is intended
.
Slide63
Voting Paper
ChargebacksSlide64
What is a Chargeback?
After the booking / issuance / payment is made on the NIET provider (e.g. myIDTravel) and after the tickets are already used, the employee/retiree states to the bank (of the CC he/she has used to pay for the tickets) that he/she does not recognize such transaction.
The bank treats this as a Fraud and starts the Chargeback process, by the time the Transporting Carrier claims the amount of the ticket(s) in question, the bank does not allow the debit due to Chargeback.
The issue at this point has to be addressed between the Employing Carrier and the Transporting Carrier. The Employing Carrier is responsible for the HR database of their own staff and their eligible nominees. It is through them that they have ID tickets with OAL.
The Transporting Carrier has no information about these ID
paxs
besides the flight details, the CC used, PTC; first name/surname and employee ID number. No direct contact may be used, Transporting Carrier relies on the good will of the Employing Carrier.Slide65
65
Transporting Airline is not able to collect the amount for the ID
tkts
which has transported already. Multiple scenarios may happen at this stage:
Employing Airline reaches their staff and he/she settles the amount to be paid with the Transporting Airline directly.
ALL
SOLVED!
Employing Airline reaches their staff and he/she refuses to settle the amount due. Employing Airline settles such with the Transporting Airline.
ALL
SOLVED!
Employing Airline reaches their staff and he/she refuses to settle the amount due. Employing Airline refuses to do such as well.
Transporting
Airline problem! Employing Airline can’t reach their staff (because they already left the airline or have retired). Employing Airline settles such with the Transporting Airline. ALL
SOLVED! Employing Airline can’t reach their staff (because they already left the airline or have retired). Employing Airline refuses to do such as well. Transporting
Airline problem
!Slide66
66
“Authorizing Airline
– a Member airline through which industry discount travel benefits are derived.”
In order to avoid possible loss of revenue by the Transporting Airline, we should hold the Authorizing Airline ultimately responsible for the inadequate actions of their staff when using a NIET solution - as for the IET issuances since payment is made directly to the Employing Airline this issue never happens.Slide67
Proposal
“… C.2
. TRANSPORTING AIRLINE TICKETING
C.2.g. Disputes and
Chargebacks
In the event of a dispute
arising in connection with tickets issued under this Agreement, it is the responsibility of the Authorizing Airline to ensure the Transporting Airline is compensated within six (6) months, or as bilaterally agreed, for transportation provided
.
”Slide68
Voting Paper
Ticket ValiditySlide69
why
?
It is imperative that an employee who has left the employer providing travel benefit on OAL, doesn’t use the bilateral concurred travel privilege after end of employment.
It sends all the wrong signals, having someone on holiday on OAL ZED tickets,
theoretically
almost 3 months after termination of employment.
how?
As soon as
end-date
is known to employer, this
end-date
should be reflected in HR/ticket issuance system. It is the responsibility of the employing carrier to adhere to
this or make effort s to recover outstanding unused ticketsSlide70
what’s required?
additional wording to ISTA.C.2.d. Validity C.2.d.i The travel authorization or ticket validity shall be no more than three (3) months from the date of issue, unless bilaterally agreed.
It is the responsibility of the employing carrier to ensure that any tickets held by employees that have been terminated, or who have resigned, are not valid after the last date of employment.
70Slide71
Voting Paper
Definition of NomineesSlide72
72
Definition of Parents
Do we want to
create a definition for “Parents” as we did for “Spouse” and “Travel Partner”
e.g.
Spouse
– any one person recognized as a spouse by the employing airline.Slide73
73
Proposal
DEFINITION
Parents
– any person recognized as a parent by the employing airline
.
The
Employee/Retiree can have only two parents eligible for
travel at one time.Slide74
74
Proposal
DEFINITION
Sibling of Employee / Retiree
– any person recognized as a sibling by the employing airline.
Slide75
Voting Paper
ZMAC ElectionSlide76
76
The ZMAC members below were elected last year and will remain until AGM 2018
Sylvia
Ibach (AB)
Teresa Miller (F9)
Peter Nielsen (SK)
Luanne Stetson
(
AS)Slide77
Four positions are vacant for the
coming yearMembers were invited to stand as a candidate
77Slide78
78
Four members put themselves forward
Afonso
Crawford (
TP)
Karmen Jese (JP)
Ingo
Jeske
(LX)
Julie Williams (BA)
Slide79
So in the absence of any other candidates these four will take their places on the Council for two years. No requirement to vote.
79Slide80
80
As a Council, we have voted between ourselves to select
our Chairperson.
This
will be:
Julie Williams (BA)Slide81
81
Our future Council
There
are plenty of you out there who
would
make very good Council Members and we want to encourage you to consider standing in future.
A challenge for us is how to persuade you to join us.
Slide82
82
Qualifying Criteria:
Open minded
Bring new ideas
Basic ZED MIBA knowledge
Staff travel experience preferred
Committed to the cause
Team player
Airline/Supervisor support/approval
Slide83
83
Your commitment
as a Council Member:
AGM
2 x
Workshops
per year
1 x ZMAC meeting per year
The above does mean arriving/departing earlier/later
Monthly conference calls
Slide84
84
We are interested to find out what else might
hinder
applications.
Time or lack of it to dedicate to ZMF?
Fear of speaking at AGMs/Working Groups?
Unable to gain authorisation to travel to anything other than AGM?Slide85
85
What ideas do you have that we can implement in order to encourage members to take this step and be instrumental in shaping the organisation’s future?Slide86
Voting Paper
AGM 2018Slide87
- PROPOSAL FOR AGM 2018 -Slide88
Why Croatia
?
Because it is:
Exciting
Beautiful
Romantic
Cultural
Relaxing
... and yet so close
…
Between 1 and 3 hours flight from all major European gatewaysSlide89
Map of Croatia
At the crossroads of cultures and civilizations, Croatia is a mixture of Mediterranean and Central Europe – reflected in diversified customs, rich national costumes, excellent cuisine and exquisite wines.
A “green” destination enabling visitors to experience the values rare in modern world – ecologically clean environment, green forests and crystal clean sea and fresh waters.
A safe corner of the world where one can enjoy an unspoiled destination and vintage hospitality!Slide90
Why
Dubrovnik?
“If you want to see heaven on Earth, come to Dubrovnik!”
George Bernard ShawSlide91
Introducing Dubrovnik
The over a thousand year old history of Dubrovnik is visible in every part of this city
, s
ince 1979 the town has been under UNSECO protection
.
“The Pearl of the Adriatic” has captivated and seduced kings and artists for centuries with its immaculate medieval architecture.
One of the most attractive and best-known cities in the Mediterranean
The city is a living museum and a live stage, and has an ideal connection between its historical past and the modern day.Slide92
Grand Villa Argentina
Hotel rate of €
130 for double room/single use and €150double room/double use, breakfast included
No up-front deposit required
All conference facilities and standard
equipment included
Croatia Airlines will sponsor
coffee breaks and one lunch
Complimentary wireless internet in all guestrooms and conference facilities
Agreed areas for vendors
Same price is guaranteed during entire week (15-22APR)Slide93
Few more picsSlide94
Hope to see you in Dubrovnik, 18/19APR2018!!!Slide95
AGM 2018
Panama CitySlide96
Semantic Changes
96
ZMF AGM 2017 – GenevaSlide97
Semantic Changes
Reference to SLA
Associates Membership
ID50S1 & IDZHR1, IDMHS1
Get input from Julie?Slide98
Coffee Break
98
ZMF AGM 2017 – GenevaSlide99
Vendors Sessions
99
ZMF AGM 2017 – GenevaSlide100
myIDTravel
100
ZMF AGM 2017 – GenevaSlide101
ID90T
101
ZMF AGM 2017 – GenevaSlide102
IBS
102
ZMF AGM 2017 – GenevaSlide103
ZMF and IATA
103
ZMF AGM 2017 – GenevaSlide104
ZMF and IATA
ISTA AgreementSlide105
“Complex Taxes” project
105
ZMF AGM 2017 – Geneva
Carlos Alanis, IATA
Manager Ticket Tax BoxSlide106
Milestones
Milestones
Planned dates
Business case approval
31
December 2015
Kick-off in GVA
26 January
2016
Recruitment project resources
29 January
2016
Workshop in GVA
25-26 February 2016Validation of diagnostic and proposed actions31 March 2016
Implementation new TTBS templates completedJune 2016Validation of report and plan for follow-up29 July 2016Report at World Financial Symposium30 September 2016Report to FinDev and agree on next steps16-17 November 2016Project final closure30 December 2016
Complex TFCs ProjectSlide107
1Q2017
Handover
Continuation of actions by diverse subject matter expert players
Beyond the 75 cases
1Q16
2Q16
3Q16
4Q16
Project initiation and business case
Workshop
and analysis of the 75TFCs
Draft new TTBS forms
Corrective Actions
Formalize
conclusions and report to FINDEV
Follow-up on open actions and handover to operations
4Q2015
Identify system solutions
Diagnostic +
Recommendations
Advocacy actions
Identification + Objectives
Report and Feedback
Conclusions and project closing
Identify workarounds
Update of TTBS content
Timeline
Phases
Deliverables
Implement new TTBS forms
Complex TFCs ProjectSlide108
Project success criteria
Closure
on the 75 TFCs open items signed off by the
FinDev
Delivery
of improved TTBS templates signed off by the
FinDev
Determination
of benefits
See
the objectives being achieved
Identification,
Simplification, Standardization, Advocacy, Framework and QuantificationComplex TFCs ProjectSlide109
Benefit quantification
Extrapolation for the 75 Complex TFCs in scope based on data extracted from the ICH. Annualized amounts of potential savings based on extracted interline rejections:
Analysis
ADMs related to TFCs
25.000 ADMs, total $1.35M value estimated per year
Main reasons: incorrect calculations, taxes not collected, taxes under wrong tax code
Complex TFCs ProjectSlide110
Issues/solutions categorization
Complex TFCs ProjectSlide111
Process ImprovementSlide112
Process improvement
New TTBS forms created and implemented, now operationalNew Tax Fee or ChargeAmendment to existing Tax Fee or Charge
Address root causes of uncertainties and errors in the coding
Intelligence incorporated into the forms to
Guide the users through clear definitions of concepts such as exemptions
Provide pre-set drop-down lists to avoid incorrect data or format being captured
Associated implementation guide and webinar training for filing carriers delivered
Post go-live improvements already delivered as part of the continuous improvement
process
Complex TFCs ProjectSlide113
Advocacy related casesSlide114
TFC Advocacy actions results
Authorities have changed the provision of the law:Côte d’Ivoire (TFC:
HZ)
Cook
Islands (TFC:
QE)
Egypt
(TFC:
EG)
Singapore (TFC: OP)South Sudan (TFC: SS
)Norway (TFC: NO) is in the hands of the national carrier and currently undergoing their own advocacy work. IATA will assist if/when necessary.
USA (TFC: AY and XF) and Canada (TFC: CA) originally assessed as requiring advocacy, shifted
solution to status quo after careful analysis of the case.
Ireland (TFC: IE) originally assessed as requiring advocacy, shifted to technical solution following the discussion with the FinDev sponsors (workaround solution deemed more suitable).IATA taxation group will continue to work on the open issues as part of their operational duties (HF Ukraine, YB Algeria, BD Bangladesh and AM Armenia).Complex TFCs ProjectSlide115
Technical related casesSlide116
Technical solution identification
Methodology: IATA has analyzed the Fare life cycle to identify where the data elements are missing
Complex TFCs Project
Most of the data elements do not exist at ET Record level
Therefore, the SOLUTION: Technical solution to introduce the data elements at ET Record level Slide117
Technical diagnosis summary
Percentage taxesIdentification of the correct fare for applicability of fare and surchargesMissing coupon and ticket data
Date of birth
Arrival/departure times
Cabin class
Tax definition not clear
Define next possible connection
Define infants (with or without seats)
Exemptions
Align to industry standards (e.g. infants under 5, children under 15)
Separate ticketsMap correct tax applications to separate ticketsComplex TFCs ProjectSlide118
37 Technical cases
Complex TFCs Project
Date of birth = 7 cases
Antigua, Barbados, UK (2), Greece, Mauritius and Venezuela
Complex Seasonality = 1 case
Ireland
Cabin Class = 1 case
Pakistan
Eligible passenger exemption = 2 cases
TurkmenistanNationality or citizenship/residency = 15 cases
Anguilla, Belize (3), Colombia (2), Maldives (2), Mexico, Nepal, Panama (2), Philippines, Seychelles and ArgentinaTax on final destination = 2 casesIndia and CongoTerminal information = 8 cases
Bulgaria (2), Hungary (2), Israel, Russian Fed., Serbia and SingaporeUnticketed points = 1 caseSingaporeSlide119
Technical solution next steps
Standards - EnhancementAdd new data elements into the sales reporting capabilitiesStandards - Implementation
Pricing to Ticketing Host/GDS
Ticketing Systems Host/GDS
GDS Implementation of Sales Reporting Standards
Revenue Accounting Systems
Project closure 12-2016 and handover
IATA Airline Distribution and Standards:
follow-up on BDISG adopting
the
standards set for the data elements.follow-up on where the new data elements should be added in the DISH, and on the implementation of the new release.
Complex TFCs ProjectSlide120
75 Complex TFCs project handover
Complex TFCs Project
To be updated (underway)
ROOT CAUSE
SOLUTION
ENGAGEMENT
4Q15
4Q16
4Q17
4Q18
4Q19
Missing data elements
Addition to DISH
BDISG/PSC 2017 adoption of DISH 23 2018 and 2019
37373737
0
Unclear/complicated regulation
Advocacy
Local airline/IATA/government reps
10
5
4
0
0
Percentage tax calculation not clear
Standard calculation approach agreed
Local airline/IATA/government reps/FINDEV sponsors
7
0
0
0
0
Ambiguity with action
Analysis and clarification bulletin as applicable
Local airline/IATA/government reps/FINDEV sponsors
8
5
0
0
0
Ambiguity no action determined
No action, status quo. Determined current process working
Local airline/IATA/government reps/FINDEV sponsors/ATPCO
13
7
0
0
0
75
53
41
37
0
forecastSlide121
Implemented a virtuous cycle with
all
players
Achievements
Advocacy processes embedded in TTBS procedures.
Better filing discipline and intelligent forms with clear guidelines
Categorized exemptions based on what pricing is capable of
Clarifications on tax applicability removing ambiguities wherever possible
System implementation required
Need to increase the quality of the data in the workflow
Focus on automation wherever possible.
Complex TFCs Project
ConclusionsSlide122
Thank you!Slide123
Break for Lunch
123
ZMF AGM 2017 – GenevaSlide124
Break-out session 1
124
ZMF AGM 2017 – GenevaSlide125
Break-out session 1
Fares and Taxes (ZED Super low) Room GenevaChargebacks & Ticket Validity Room
Bâle
ISTA Familiarization Room LausanneSlide126
Break-out session 2
Fares and Taxes (ZED Super low) Room GenevaChargebacks & Ticket Validity Room
Bâle
ISTA Familiarization Room LausanneSlide127
Break-out session 3
Fares and Taxes (ZED Super low) Room GenevaChargebacks & Ticket Validity Room
Bâle
ISTA Familiarization Room LausanneSlide128
Summary of Break-out sessions
&Voting Papers discussionSlide129
Announce for Dinner
129
ZMF AGM 2017 – GenevaSlide130
Time for 1:1 ‘sSlide131
ZMF AGM 2017
29 & 30 March 2017Geneva, Switzerland
Welcome backSlide132
Summary and key points of Day 1
132
ZMF AGM 2017 – GenevaSlide133
“NDC” project
133
ZMF AGM 2017 – Geneva
Cécile Rousseau, IATA
Manager Channel DistributionSlide134
See separate presentation fileSlide135
“ONE order” project
135
ZMF AGM 2017 – Geneva
Ionut
Badea
, IATA
Manager ONE Order
Engagement and StrategySlide136
See separate presentation fileSlide137
“Cost of Payment” project
137
ZMF AGM 2017 – Geneva
Pascal Burg, Edgar Dunn & Co
Member of the project teamSlide138
Cost of Payments
Industry Transformation
March 2017Slide139
Due to technology evolution, new payment methods (such as eWallets, VANs) are quickly emerging, some supported by GDSs. These new payment methods are usually coming with higher costs per transaction.
As
of today, airlines are not able to identify, discriminate or decide on payment methods acceptance, even though airlines are by default absorbing their
cost.
IATA
is planning new industry-wide initiatives involving Airlines, Travel Agents and GDSs, whose objective is to provide each airline with
transparency
, detection and
consent
regarding payment methods acceptance.Slide140
1. Direct Sales
BSP Card
BSP “Cash”
2. Indirect Sales: pass-through card sales
Customer’s card:
pass-through
Customer’s card:
payment
Bank transfer from the
agent’s bank account to
the airline’s bank account
$$$
Moneys held
in trust
Bank transfer or any other
form of payment
used by the customer
3. Indirect Sales
BSP original designSlide141
1. Direct Sales
BSP Card
BSP “Cash”
2. Indirect Sales: pass-through card sales
Customer’s card:
pass-through
Customer’s card:
payment
Bank transfer from the
agent’s bank account to
the airline’s bank account
$$$
Moneys held
in trust
Bank transfer or any other
form of payment
used by the customer
3. Indirect Sales
BSP
evolution
Agent’s
card or VAN
BSP Card remittancesSlide142
Sources:
CC:
Phocus Wright March 25
th
,2013 + BSP and ARC sale figures.
Van:
VAN provider, public information.
eWallet:
Global eWallet provider public information *calculated on an average $400 ticket with TA monthly sale of above 100K..
BSP Cash:
IATA internal information.
IATA EasyPay:
RFP average outcome in process
Current Market Situation – Average fee per transaction benchmark
CustomerPaymentAgentRemittanceAirlines consent effectiveSlide143
Sources:
CC:
Phocus Wright March 25
th
,2013 + BSP and ARC sale figures.
Van:
VAN provider, public information.
eWallet:
Global eWallet provider public information *calculated on an average $400
ticket with TA monthly sale of above 100K..
BSP Cash:
IATA internal information.
IATA EasyPay:
RFP average outcome in process
Current Market Situation – Average fee per transaction benchmarkCash flow speed2-3 days2-30 days2-30 days18.9 days
2-30 days“Credit risk”
-
-
-
0.025%
unknown
Agent “payment” recourse risk
-
yes
-
-
yes
Value proposition to AirlinesSlide144
1. Direct Sales
BSP Card
BSP “Cash”
2. Indirect Sales: Pass-through card sales
$$$
Funds held
in trust
3. Indirect Sales
Agent’s or Wholesale card
Preliminary scenario analysis – Current merchant fees costs for the airline industry
33%
66%
Indirect sales
card merchant fees (ARC)
$1.8
bn
Total current industry costs of card merchant fees
$6.5
bn
Direct sales
card merchant fees
$2.9
bn
$1.8
bn
Indirect sales
BSP card merchant feesSlide145
Thank you!Slide146
What is SIS again?
146
ZMF AGM 2017 – Geneva
Momchil
Momchilov
, Manager Invoicing & Collection
Adrian Dulaj, Manager Invoicing and MetricsSlide147
Simplified Invoicing and Settlement
Introduction and highlightsSlide148
What is SIS?
SIS is the industry platform that facilitates the electronic invoicing and settlement process by streamlining key processes, unifying invoicing standards, and reducing paper wastes, ultimately fostering a simpler and more efficient environment for airlines and aviation business partners –such as ground handlers, maintenance companies, and manufacturers – to engage in business.
Key Features
One e-invoicing standard
Optional automatic settlement in ICH/ACH
Billing/billed data automatically available for reconciliation
Digital Signature and legal compliance services
Availability of
audi
t trail for record-keeping
SIS – Introduction and Highlights
148Slide149
Who is using SIS?
In 2016 SIS had over 600 airlines and suppliers sending and receiving invoices. In addition to these paying customers, more than 1,400 companies have registered to receive invoices through SIS from IATA or other business partners.
Including the IATA offices and E&F Airports, SIS had a total of 2,144 participants at the end of 2016.
In Billing Year 2016 SIS processed 1,500,936 invoices (interline and suppliers) valued at approx. USD 66 Billion.
83% of invoices were submitted by airlines and 17% by suppliers (including IATA).
90% of all invoices are settled though the Clearing House (ICH and ACH).
SIS – Introduction and Highlights
149Slide150
SIS – How to download your ZMIBA invoice?
(Presenting…)SIS – Introduction and Highlights
150Slide151
Coffee Break
151
ZMF AGM 2017 – GenevaSlide152
Break-out session 2
Survey / Newsletter Room GenevaWebsite Room
Bâle
1:1 Room LausanneSlide153
Voting Begins
153
ZMF AGM 2017 – GenevaSlide154
Break-out session 1
Survey / Newsletter Room GenevaWebsite Room
Bâle
1:1 Room LausanneSlide155
Break-out session 1
Survey / Newsletter Room GenevaWebsite Room
Bâle
1:1 Room LausanneSlide156
Break for lunch
156
ZMF AGM 2017 – GenevaSlide157
Membership Fees
and
Proposed budget 2017-2018
157
ZMF AGM 2017 – GenevaSlide158
AOB
158
ZMF AGM 2017 – GenevaSlide159
Next Meetings
159
ZMF AGM 2017 – Geneva