Fly America Act: Upholding Letter and Spirit
The Fly America Act requires that individuals whose travel is being paid for by the U.S. government fly on a U.S.-flagged carrier whenever possible. While the original Act did not foresee code sharing, the Government Accountability Office (GAO) has interpreted the Act to permit U.S. carriers to operate “Fly America” services by placing their code on foreign partners. However, mindful of the purpose of the Fly America Act, the GAO requires that in such cases U.S. airlines “receive a substantial portion of the revenue” and do “not act as a mere booking agent on behalf of the foreign partner.”
Recently, the Fly America Act has come under attack both in letter and spirit. Foreign carriers have attempted to subvert the law’s intention by “renting” a code from a small U.S. carrier, obtain agreement from the U.S. carrier that the foreign carrier would conduct almost all the flying, and have the U.S. carrier bid on Fly America contracts—in direct contradiction to the purpose of the Fly America Act.
In this debate, it is important to remember:
- The language of the Fly America Act requires passengers whose travel is paid for by the U.S. government to travel on U.S.-flagged carriers;
- The GAO has interpreted this language broadly to allow for code sharing in certain circumstances;
- The purpose of the Fly America Act is to ensure taxpayer-funded travel supports U.S. businesses and U.S. jobs;
- The Fly America Act requires U.S. airlines to competitively bid for traffic, so the end result is below-commercial rates for U.S. government travel;
- The World Trade Organization does not consider the Fly America Act a subsidy; and
- Fly America helps support 11 million U.S. aviation jobs and 5 percent of the U.S. gross domestic product.
The U.S. government must maintain close adherence to both the letter and spirit of the Fly America Act. The U.S. airline partner in a code share with a foreign airline must never be reduced to “a mere booking agent on behalf of the foreign partner.” ALPA urges all relevant parts of the U.S. government to be mindful of these concerns in the future administration of the Fly America Act.