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AIRLINE TARIFF PUBLISHING COMPANY

PASSENGER PRORATE RULES MANUAL NO. 8

IMPORTANT NOTICE: Passenger Prorate Rules Manual Number 8, Issued July 1, 2005 cancels Passenger Prorate Rules Manual Number 7, Issued October 15, 1995. Rules 1-3 in this Manual are those used by AIRLINE TARIFF PUBLISHING COMPANY in computing joint fare prorates distributed in the ATPCO Passenger Joint Fares Data Subscription Service, in the ATPCO Passenger Interline Pricing/Prorate System (PIPPS), and the Centralized Industry Proration Service (CIPS) for specifically published joint fares. Rules 3-30 are used by the REVENUE ACCOUNTING COMMITTEE of the AIRLINES CLEARING HOUSE (ACH) and contain the rules used by the Revenue Accounting Departments in computing prorates for joint and interline fares not provided in PIPPS.

ISSUED BY AIRLINE TARIFF PUBLISHING COMPANY

WASHINGTON DULLES INTERNATIONAL AIRPORT 45005 AVIATION DRIVE

DULLES, VA 20166

EFFECTIVE

July 1, 2005 (except as noted May 22, 2005)

TABLE OF CONTENTS

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Introduction ............................................................................................................................................................................ 3

Explanation of Symbols.......................................................................................................................................................... 4

Prorate Rules Manual Glossary............................................................................................................................................... 5

Rule No.

1. Joint Prorate Agreements ................................................................................................................................................ 8

A. Agreed Prorate Shares........................................................................................................................................ 8

B. Fixed Prorate Share .......................................................................................................................................... 10

2. Joint Fares Prorate Rule—Straight-Rate Prorate Formula ............................................................................................ 13

3. Prorate Factors .............................................................................................................................................................. 14

11. Straight-Rate Prorate Formula Used in Prorating Fares for Which Prorates Are Not Provided in PIPPS .................. 23

12. Published Joint Fares—Unpublished Prorates/Incorrect Agreed Prorates .................................................................. 32

13. Revised Local Fares—Effects on Prorates.................................................................................................................. 33

14. Construction Points—Recognition in Prorating.......................................................................................................... 34

15. Value of Endorsed/Voluntarily Rerouted Coupon(s) .................................................................................................. 35

16. Value of Involuntary Rerouted Coupon(s).................................................................................................................. 39

24. Proration of On-Line Fares or On-Line Portions of Joint Fares.................................................................................. 41

25. Prorates Applicable to Round Trip, Circle Trip or Open Jaw Fares ........................................................................... 42

26. Proration of Visit Another Country Local, Joint, and Open-Jaw Visit U.S.A. Fares .................................................. 43

27. Prorates Applicable to Discounted Fares Based on a Published Perecentage ............................................................. 46

28. Proration of Excess Baggage Charges ........................................................................................................................ 48

29. Proration of Specifically Published Stopover Charges .............................................................................................. 49

30. Proration of Special Service Coupon(s) ..................................................................................................................... 51

INTRODUCTION

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Airline Tariff Publishing Company maintains and distributes to airlines and revenue accounting systems specified joint passenger fares in its North American fares database. In addition, on the joint fare record are the specifications on the division of the published joint fare amount to the participating airlines of the joint fare. This division of the joint fare amount that ATPCO provides could have occurred in one of two ways:

1. Joint Prorate Agreement which specifies an agreed upon amount (Rule 1)

2. Calculated by the Joint Fares Prorate Rule (Straight-Rate Prorate Formula) (Rule 2)

PIPPS is the ATPCO Passenger Interline Pricing/Prorate System which loads all ATPCO distributed fares and uses Rule 3 for the prorate selection process and formulas contained within these rules to prorate selected fares or a manually entered ATBP (Amount to be Prorated).

CIPS is the ATPCO Centralized Industry Proration Service which accesses the PIPPS fares database to select the prorate factors or joint fares including how the division of the joint fare should occur utilizing the criteria specified in Rules 1-3.

The formulas and rules used by airline Revenue Accounting departments in computing prorates not published by ATPCO are published in Rules 3-30.

NOTE: All examples including the data for fares and prorated amounts used in the rules of this manual are fictional and are for explanatory purposes only.

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EXPLANATION OF PRORATE SYMBOLS FOR JOINT FARES IN PIPPS / / Indicates that the airlines named in the routing have no Special Prorate Agreement and that ATPCO has used Rule 2,

the Joint Fares Prorate Rule to calculate the prorates.

/A/ Indicates that two airlines have agreed to specified shares or that one airline is receiving a specifically agreed amount and the second airline receives the remainder of the joint fare. See Rule 1 for a description of both types of agreements.

/C/ Indicates that the airlines named in the joint fare have an agreed prorate arrangement, but the amounts have not been supplied to ATPCO. The amounts shown in the PIPPS display may be blank or calculated using the Joint Fares Prorate rule.

/*/ Indicates that the prorate amounts agreed by the airlines in the routing exceed the total of the joint fare. In this case it may be necessary to contact the airlines involved.

PRORATE RULES MANUAL GLOSSARY

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PRORATE RULES MANUAL GLOSSARY Airline

Honoring – The airline which actually honors a ticket/coupon for passage, refund and/or reissuance.

Issuing/Ticketing/Validating – The airline name preprinted or imprinted on the face of the ticket/coupon.

Operating - The airline actually providing carriage or other services incidental to such air carriage. The Operating airline may be different from the Marketing airline in situations where bilateral agreements exist, e.g. code share agreement.

Marketing/Ticketed Airline - The airline code that will appear on the flight coupon of the ticket (different from operating airline for code share.) The Marketing airline may be a primary and/or secondary airline.

ATBP (Amount to be Prorated) – For interline settlement, collection will determine the fare to be billed (if appropriate for the fare basis/ticket designator code for the Airline and origin/destination ticketed), provided the collection is in agreement with the fare provided by PIPPS, in effect on the date of issuance of ticket.

CAD – Canadian dollars.

CIPS – ATPCO’s Centralized Industry Neutral Proration Service

Continental United States – The District of Columbia and all states of the United States of America other than Alaska and Hawaii.

Coupon, Flight – That portion of a Ticket annotated ‘good for passage’ or a segment(s) of an Electronic Ticket.

Coupon, Passenger - The portion of the Passenger Ticket and Baggage check that constitutes the passenger’s written evidence of the contract of carriage.

Destination – The last point in a given itinerary. On a round trip or circle trip the destination is the point of origin.

Electronic Ticket (ET) – Itinerary/Receipt issued by or on behalf of the carrier, the electronic coupons and, if applicable a boarding document.


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Fare (By Type) l. Circle Trip – A fare that is constructed in accordance with the circle trip rule of the governing tariff.

2. Interline – Same as "Joint Fare" or a combination of two or more airlines' fares.

3. Joint – A fare published for transportation via two or more airlines.

4. Local – A fare published for transportation via one airline.

5. Open Jaw Trip – A fare that is specifically published as an open jaw trip fare, or a fare that is constructed in accordance with the open jaw trip rule of the governing tariff.

6. Round Trip – A fare that is specifically published as a round trip fare, or a fare that is constructed in accordance with the round trip rule of the governing tariff.

7. Special/Promotional – Any fare type not designated in the ATPCO database as a Normal First, Business, Economy Restricted or Unrestricted fare type. ATPCO Fare Types/Fare Type codes may be viewed through PIPPS when selecting a fare using the text translation code “F” to navigate to the fare type description text.

8. VUSA fares – Visit USA fares - specifically published fares or Fares by rule that may be calculated according to the provisions of the rule in which they reside.

Fare Type Code – The Fare Type code assigned by the airline or ATPCO in accordance with the Fare Type Matrix published as Appendix B of the ATPCO Passenger Automated Rules documentation.

Interchange Point – the point at which there is a change of airlines when a flight is operated over the routes of two or more airlines without change of equipment.

Interline – to utilize the services of more than one airline in connection with a particular fare.

Itinerary – Passage designated by the "from-to" parts of a ticket and conjunction tickets, including the airlines shown in the "Via Airline" column of such tickets.

Joint Fare Prorate Agreement – A bilateral agreement between two airlines to divide the revenue of a joint fare with either one airline receiving a set amount for its sector of travel or both airlines receiving set amounts for each of their sectors.

Multiple Construction – Fare construction where the same total fare can be obtained by recognizing two or more different construction points.

North America – Any point between and within Canada and the United States of America.

On-line fares – wholly within one marketing airline

On-line portions of joint fares – In a joint fare of two or three interchange points, if there is an on-line sector, the on-line sector may be treated as a single factor in the proration process.

Origin – The first point on a given itinerary from which travel was actually designated to commence.

PIPPS – ATPCO Passenger Interline Pricing/Prorate System. The official source of North American local and joint fares data that is updated by the ATPCO Passenger Data Subscription services.


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PIPPS Canadian Conversion Rate - The conversion rate derived from the predominant conversion rate used by airlines serving transborder markets.

PMP – Prorate Manual – Passenger, the single source of passenger prorate information for all airlines throughout the world. The data are for use by airlines who use the Multilateral Proration Agreement – Passenger (MPA) as the basis for their interline settlements.

Prorate – A division of revenue determined by applying the Straight-Rate Prorate Formula (Rule 2) or by special bilateral agreement.

Prorate Shares – The revenue for each airline participating in a joint fare published in PIPPS.

1. Agreed Prorate Shares – Two airlines agree to specific prorate shares for a joint fare published in PIPPS.

2. Fixed Agreed Prorate Shares – Two airlines agree on a specific share for one of the airlines in the joint routing with the remainder of the joint fare accruing to the other airline(s).

3. Joint Fare Prorates

a. Dividing revenue between airlines participating in a joint fare in the ratio of the sum of the local fares between each transfer point to the joint fare; or

b. Sub-dividing an airline's local fare in the ratio of the sum of the local fares between each ticketed point to such local fare; or

c. Sub-dividing an airline's prorated part of a joint fare in the ratio of the sum of the local fares between each ticketed point to the prorated portion of the joint fare.

Published Fare - A fare published in PIPPS as a single amount.

Sector - One airline's continuous part of any given itinerary or fare construction.

Straight-Rate Prorate Formula – The proportional division of the through fare or excess baggage charges.

Through Fare - The total fare from point of origin to point of destination. It may be a joint fare or a combination of fares.

Tickets (By Type)

1. On-Line - A ticket designating passage via a single marketed and operated airline issued by that airline.

2. Interline - A ticket designating passage via more than one airline even though usage may be made to the contrary.

Transfer Point - The point where transfer is made from one airline to another.

United States of America (U.S.) – The District of Columbia and the 50 United States.

USD – U.S. dollars

SECTION I PASSENGER PRORATE RULES 1 THROUGH 10

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RULE 1—JOINT PRORATE AGREEMENTS Marketing airlines participating in published joint fares may elect to have an agreed amount specified for the division of revenue by one of two methods: Agreed prorate shares for both marketing airlines, or a Fixed prorate share for one of the marketing airlines within the joint fare.

A. Agreed Prorate Shares

Marketing airlines participating in a joint fare may agree to divide the joint fare into specific dollar amounts that total the joint fare. Agreed specific dollar amount agreements are indicated in PIPPS by an “/A/” preceding the prorate shares. In this case the Prorate Shares are automatically adjusted by ATPCO and redistributed in the Passenger Joint Fare Subscription service each time the joint fare is updated so that the total of the shares equals the joint fare. This adjustment is calculated by applying the percentage (calculated to 5 positions beyond the decimal) of the joint fare change to each prorate share of the joint fare, unless specifically updated by the airlines. These new amounts, regardless of how they are created, will be distributed as part of the ATPCO Passenger Joint Fares Data Subscription Service and are updated in PIPPS and used in CIPS through this service. Example 1. Original Joint Fare Between YTO—YMQ—DTT USD 371.00 The joint fare indicates that YTO—YMQ is for marketing Airline 1 and YMQ—DTT is for marketing Airline 2. Original Joint fare also lists the agreed prorate shares:

Agreed Prorate Share—Airline 1: USD 224.13 Agreed Prorate Share—Airline 2: USD 146.87 Joint Fare Total of Prorate Shares: USD 371.00

Settlement –

If the ticket is validated on Airline 1 This indicates that Airline 2 is entitled to bill and should collect USD 146.87 from Airline 1 when the YMQ—DTT sector is flown. If the ticket is validated on Airline 2 This indicates that Airline 1 is entitled to bill and should collect USD 224.13 from Airline 2 when the YTO—YMQ sector is flown.


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Example 2. Joint Fare from Example 1 increased: USD 391.00

Fare Ratio calculated is USD 391/USD 371 = 1.05390 or 105.390%

Agreed Prorate Share—Airline 1 USD 236.21 (224.13 × 105.390% = 236.210)

Agreed Prorate Share—Airline 2 USD 154.79 (146.87 × 105.390% = 154.786)

Joint Fare Total of Prorate Shares USD 391.00

Explanation:

1. Using the Joint Prorate Formula (Rule 2), divide the new joint fare by the total of the shares

USD 391 ÷ USD 371 = 1.05390 or 105.390%

2. Multiply the percentage times the first Airline prorate share

105.390% × 224.13 = USD 236.21 for Airline 1’s prorate share

3. Multiply the percentage times Airline 2’s prorate share

105.390% × 146.87 = USD 154.786 which is rounded to 154.79 for Airline 2’s prorate share as the computed value has a fractional cent of 5/10ths or greater.

4. If Airline 1’s share USD 236.21 + Airline 2’s share USD 154.79 were not equal to the increased fare, the residual would be allocated to the last carrier in the joint routing.


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B. Fixed Prorate Share / A/

Airlines participating in a joint fare may agree that one of the airlines will receive a fixed prorate share. Fixed Prorate Share agreements are indicated in PIPPS by an “ /A/” preceding the prorate shares. When the Fixed Prorate Share agreement is applied to a fare involving only two airlines, the second airline receives the remainder of the joint fare. If three or more airlines are involved, the remainder is prorated in accordance with Joint Fares Prorate Rule 2. Example 1. Original Joint Fare: CAD 1,581.00 Fixed Prorate Shares: Airline 1 —Fixed prorate share 785.00 Airline 2 —Remainder of joint fare 796.00 Prorate Shares total Joint Fare: CAD 1,581.00 The Joint Fare is increased to: CAD 1,950.00 Airline 1—Fixed Prorate Share - CAD 785.00 Airline 2—Fixed Prorate Share becomes the Joint fare CAD 1,950.00 minus the Airline 1 Fixed Prorate Share 785.00 CAD 1,165.00


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Example 2. If the joint fare were a 3 airline joint fare: Airline 1—Fixed Prorate Share is unchanged at CAD 785.00 The prorate shares for Airline 2 & 3 would be calculated per the Rule 2 guidelines first by determining the amount to be prorated, i.e., the remainder of the joint fare after subtracting Airline 1 Fixed Share of CAD 785.00 from the Joint Fare CAD 1,950.00: Remainder of Joint Fare: CAD 1,165.00 Local fare Airline 2 CAD 250.00 Local fare Airline 3 CAD 985.00 Total local fares Airline 2 + Airline 3 CAD 1,235.00 Fare ratio CAD 1,165/CAD 1,235 = .94331 or 94.331% Airline 2 Prorate Share CAD 235.83* (250.00 × 94.331% = 235.827) Airline 3 Prorate Share 929.17* (985.00 × 94.331% = 929.160) CAD 1,165.00 *Airline 2’s Share CAD 235.827 is rounded to 235.83 *Airline 3’s Share CAD 929.16 is adjusted to 929.17 to total the amount to be prorated. (It is rounded up as it is the last coupon on the ticket.) Explanation:

1. Using the Joint Prorate Formula (Rule 2), divide the total of the remainder of the joint fare CAD 1,165.00 by the total of Airline 2 and 3’s local fares

CAD 1,165.00/CAD 1,235.00 = .94331 or 94.331%

2. Multiply the percentage times airline 2’s local fare 94.331% × 250.00 = CAD 235.827 rounded to 235.83 for Airline 2’s prorate share as the computed value has a fractional cent of

5/10ths or greater.

3. Multiply the percentage times airline 3’s prorate share 94.331% × 985.00 = CAD 929.160 adjusted to CAD 929.17 to total the amount to be prorated for Airline 3’s

prorate share


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Example 3. Joint Fare in Example 2 increased: CAD 2,080.00 Airline 1—Fixed Prorate Share CAD 785.00 Remainder of Joint fare 1,295.00 Local fare Airline 2 CAD 250.00 Local fare Airline 3 CAD 985.00 Total local fares Airline 2 + Airline 3 CAD 1,235.00 Fare ratio CAD 1,295/CAD 1,235 = 1.04858 or 104.858% Airline 2 Prorate Share CAD 262.15* (250 × 104.858% = 262.145) Airline 3 Prorate Share CAD 1,032.85 (985 × 104.858%= 1,032.851) CAD 1,295.00 *Airline 2’s Share is rounded from 261.145 to 262.15. Explanation:

1. Using the Joint Prorate Formula, Rule 2, divide the total of the remainder of the joint fare CAD 1,295 by the total of Airline 2 and 3’s local fares

CAD 1,235.00 = 1.04858 or 104.858%.

2. Multiply the percentage times Airline 2’s local fare 104.858% × 250.00 = CAD 262.145 which is rounded to 262.15 as the computed value has a fractional cent

of 5/10ths or greater for Airline 2’s prorate share.

3. Multiply the percentage times Airline 3’s prorate share 104.858% × 985.00 = CAD 1,032.85 for Airline 3’s prorate share.

4. If Airline 2’s share USD 262.15 + Airline 3’s share USD 1,032.85 were not equal to the increased fare, the residual would be allocated to the last carrier in the joint routing.


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RULE 2—JOINT FARES PRORATE RULE—STRAIGHT-RATE PRORATE FORMULA

A. Application

Unless specified in Rule 1, the Joint Fares Prorate Rule using the Straight-Rate Prorate formula is used to divide revenue for all joint fares provided in the ATPCO Passenger Joint Fares Data Subscription service and in PIPPS. Joint fares are updated through the ATPCO fares process and then distributed to customers of the ATPCO Passenger Joint Fares Data Subscription Service and PIPPS nightly six days a week. (See Rule 3 for the prorate factor selection process.)

B. General

1. When the same marketing airline appears on both sides of an interchange point in a joint fare, the interchange point is ignored and the through local fare is used as a prorate factor. For example, in the joint routing SEA—UA—YVR—AC—YTO—AC—YQG, the prorate factors selected would be the local UA fare SEA—YVR and the local AC fare YVR—YQG, ignoring the YTO interchange point.

2. When a USD joint fare contains a portion of the joint fare as defined in paragraph 1 that is wholly within

Canada and there is no U.S. dollar local fare published that is in effect during the effective date range of the joint fare, the local fare published in CAD is divided by the PIPPS Canadian conversion rate in effect for that date of ticket issuance. The adjusted amount is used as a prorate factor. (See Rule 3 for further details on the prorate factor selection process).

3. When a CAD joint fare contains a portion of the joint fare as defined in paragraph 1 that is wholly within the

U.S. and there is no Canadian dollar local fare published in effect during the effective date range of the joint fare, the local fare published in USD is multiplied by the PIPPS Canadian conversion rate in effect for the date of ticket issuance. The adjusted amount is used as a prorate factor. (See Rule 3 for further details on the prorate factor selection process).

Straight-Rate Prorate Formula (Prorate factors are selected for the marketing airline as specified in Rule 3.)

a. Divide the sum of the prorate factors into the through fare amount. Carry the percentage factor to five digits beyond the decimal (PIPPS), dropping all digits beyond the fifth, or seven digits beyond the decimal (CIPS), dropping all digits beyond the seventh.

b. Multiply each local fare by the percentage factor rounding the amounts to the next higher full cent

if the computed value has a fractional cent of 5/10ths or greater. c. Adjust the prorate amount for the last segment in the routing so that the total of the prorate

amounts equals the fare amount to be prorated.


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NOTE: Beginning with Rule 3 and all subsequent rules, the following applies: PIPPS/CIPS shall be considered an official tariff for determining interline settlement values. PIPPS shall take precedence over any conflicting interline settlement procedure and any tariffs. RULE 3.—PRORATE FACTORS

A. General

1. All Normal First, Business and Economy Class unrestricted and restricted fare types of the marketing airline are considered for selection as prorate factors. Fare types are those used in the ATPCO Automated Rules Service and are assigned by the airline or ATPCO analyst in accordance with the rules published in Appendix B of the Automated Rules Service documentation.

2. Airlines may code Category 23 “Miscellaneous Fare Tags”, of the ATPCO Automated Footnote/Rules

Subscription Service, to designate specific use of fares that are considered as a prorate factor. When one of the fares considered in Step 1 contains a Category 23 provision then mandatory use or exclusion of fares based on rule and/or footnote as described below will be applied:

a. When Category 23 Byte 8 (construction) = “R” (must be used for construction purposes), this fare

will be excluded when selecting prorate factors. When the value is “N” (may not be used) or “Y” (may be used), the fare may be selected as the prorate factor for calculation.

b. When Category 23 Byte 9 (prorate) = “N” (may not be used for prorate calculation), this fare must

be excluded from being selected as a prorate factor for calculation. When the value = “R” (must be used), this fare must be selected as the prorate factor for calculation.

c. When Category 23 Byte 10 (differential calculation) = “R”, (must be used as either the low or high

fare in differential calculation [may still be used as the solution (base fare) when pricing a fare component]), this fare may be selected as a prorate factor for calculation. When the value = “N” (cannot be used as either the low or high fare in differential calculation, [may still be used as the solution (base fare) when pricing a fare component]), this fare may be selected as a prorate factor for calculation.

d. When Category 23 Byte 12 (proportional) = “P” (fare is a proportional fare), this fare must be

excluded from being selected as a prorate factor for calculation.

NOTE: Footnotes regarding proration will be used for local fare selection, but ticketing and/or travel dates within the footnote definition are not processed.


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B. Prorate Fare Selection Hierarchy Process

The steps used to select fares to be used as prorate factors are described below. These steps may be combined or changed in the order they are executed for efficiency purposes provided it does not impact the results. 1. Determine the Cabin in which the through fare is published. This is done by looking at the fare type for the

fare that was published and comparing it to the Fare Type Matrix to determine the Cabin. 2. Fares that have been distributed through the ATPCO data subscription services are then selected for each of

the sectors for the marketing airline by the ATPCO Fare Type assigned through the ATPCO Automated Rules System. Only Normal fares are considered within the Cabin that was determined in Step 1. (See the grid for fare types that are considered within each Cabin: First, Business and Economy). If no fares exist for any of the fare types specified within the Cabin of the through fare, then the next lower Cabin group is selected. This process is repeated until at least one fare is selected. If no fares exist for any Cabin for the marketing airline, then the selection is made by repeating this process and searching for fares for the operating airline (when a codeshare agreement exists). If no fare is selected, then the search is for the highest dollar amount through fare for the Cabin for any airline that does not have a Category 23 footnote which states it cannot be used.

3. All normal fares that are selected within the Cabin are then checked for a Category 23 prorate tag provision.

If there are no fares with a Category 23 prorate tag then all of the fares are taken to the next step. If any of the fares have a Category 23 prorate tag which states that the fare must be used in proration, then these fare(s) are selected first regardless if the process is performing ‘any carrier’ selection or ‘specified carrier’ selection. If any fares have a Category 23 prorate tag which states that they cannot be used, these fares must be excluded from the list and all others on the list are taken to the next step.

4. Local Fare Selection – All local fares will be selected according to the hierarchy shown in the grid below.


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Fare Type Designation Fare Type Fare Type Code Cabin Level

First First Class Unrestricted FU F 1

First Class Restricted FR F 2

First Class Sleeperette FS F 3

Business Business Class Unrestricted BU C 1

Business Class Restricted BR C 2

Economy Economy Unrestricted EU Y 1

2nd level Economy Unrestricted ES Y 2

3rd level Economy Unrestricted ET Y 3

Economy Restricted ER Y 4

2nd level Economy Restricted ERS Y 5

3rd level Economy Restricted ERT Y 6

Examples of the Fare Selection Hierarchy Process described above. Example 1:

An F123 fare class is being prorated. This F123 is determined to be an FS (First Class Sleeperette) fare type by looking up the automated rules fare type. Since FS is in the First Class Cabin, the search begins within the First Class Cabin, Level 1, First Class Unrestricted fare type (FU). If none exists, the next option would be a First Class Restricted fare type (FR), third the First Class Sleeperette (FS). If no First Class fare type exists, the search would proceed into the next lower cabin group—Business Class Cabin and absent a Business Class fare type would default to the Economy cabin options.

Example 2:

Airline AB has two Economy fare types between LAX and MSP:

“Y” which is determined to be an EU (Economy Unrestricted) fare type by looking up the automated rules fare type. This fare is USD 630 and bears a rule Category 23 prorate tag restriction that indicates it “must be used in proration.”


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“Y1” which is determined to be an ER (Economy Restricted) fare type by looking up the automated rules fare type. This fare is USD 780 and bears no rule Category 23 prorate restriction.

The lower Y (EU) fare type is selected as it bears the rule Category 23 prorate tag, “must be used in proration.”

Example 3:

Example 3 is identical to Example 2 except that the Economy unrestricted Y fare has no Category 23 prorate tag. As a result the higher Economy Restricted Y1 fare would be selected through the fare selection process described below: Airline AB has two Economy fare types between LAX and MSP: “Y” which is determined to be an EU (Economy Unrestricted) fare type by looking up the automated rules fare type. This fare is USD 630 and bears no rule Category 23 prorate restriction. “Y1” which is determined to be an ER (Economy Restricted) fare type by looking up the automated rules fare type. This fare is USD 780 and bears no rule Category 23 prorate restriction. The Y1 (ER) fare type is selected as it is an economy fare at a higher fare amount. Note: a Category 23 prorate restriction may be held in a fare rule or a footnote.

5. If multiple fares still exist for the same fare type, the highest fare amount regardless of routing or fare class assigned will be selected.

Example:

Airline AB has the following three Economy fares that are classified as Economy Unrestricted fare types between New York and Los Angeles:

Rule No. Routing No. Y $1464.19 2000 0428 YOBV $ 650.23 2500 0428 Y06 $1202.79 2000 0328

The Y at $1464.19 would be selected as it is the highest fare among the three Economy Unrestricted fares types and none of the three has any Category 23 rule or footnote restriction.


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C. Examples Example 1: Intra Canada joint fare with on-line segment Fare Class: YJ Routing: YYC—AC—YWG—JV—YXL—JV—YQT 1. Fare Type look up of the YJ determines that this is an ER —which is in the Economy Cabin 2. Search in the Economy Cabin for fares to be used as prorate factors 3. Results return the following fares: YYC—YWG (two fares were found) YWG—YQT (only one fare was found) YYC—YWG: AC Restricted Economy Y class fare at CAD 1,100.00 with a fare type of ER and a Category 23 footnote which states “must be used in proration”. AC Restricted Economy Y class fare at CAD 1,500.00 with a fare type of ER and no footnote. Here the AC Y class fare at CAD 1,100.00 with a fare type of ER would be selected as the Category 23 footnote indicates that it must be selected. YWG—YQT: JV Restricted Economy fare CAD 526.00* *The YWG—YQT JV local fares is selected ignoring the YXL interchange point. 4. Formula Calculation YYC-YQT Joint Fare

Fare Amount: CAD 1,400.00 AC Local Fare YYC—YWG CAD 1,100.00 JV Local Fare YWG—YQT 526.00 Total Local Fares CAD 1,626.00 Fare Ratio CAD 1,400.00/CAD 1,626.00 = .86100 or 86.100% AC Share CAD 947.10 (1,100.00 × 86.100% = 947.10) JV Share* CAD 452.90 (526.00 × 86.100% = 452.886)

*The JV share CAD 452.886 is rounded to the next highest full cent or CAD 452.89 as the computed value for Airline 2’s prorate share has a fractional cent of 5/10ths or greater. The JV share is further adjusted to CAD 452.90 in order to total the amount to be prorated. Total of local shares = CAD 1,400.00.


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Example 2: Joint Canada—U.S., Transborder fare, round-trip fare Fare Class: BJ7NR Routing: YCB—7F—YEA—AC—DEN (Round trip is via the same routing and airlines, thus it would be prorated in the same manner as the outbound.) 1. Fare Type look up of the BJNR determines that this is an XPX—which is in the Economy Cabin 2. Search in the Economy Cabin for fares to be used as prorate factors 3. Results return the following fares:

YCB—YEA (only one fare was found) 7F Unrestricted Y class fare at CAD 2,006.00 with fare type EU YEA—DEN (two fares were found) AC Unrestricted Y class fare at CAD 1,702.00 with a fare type of ER and a category 23 footnote which states “must be used in proration” AC Unrestricted Y class fare at CAD 1,840.00 with a fare type of EU and no footnote Here the AC Y fare class with a fare type of ER at CAD 1,702.00 would be selected as the footnote indicates that it must be selected.

4. Formula calculation YCB-DEN Round Trip BJ7NR

Fare Amount: CAD 3,568.00 (r/t) CAD 1,784.00 (o/w) 7F Local (o/w) Fare CAD 2,006.00 AC Local (o/w) Fare CAD 1,702.00 Total Local Fares CAD 3,708.00 Fare Ratio CAD 1,784.00/CAD 3,708.00 = .48112 or 48.112% 7F (o/w) Share CAD 965.13* (2,006.00 × 48.112% = 965.126) AC (o/w) Share CAD 818.87 * (1,702.00 × 48.112% = 818.866) Total Share CAD 1,784.00

*7F share CAD 965.126 is rounded to the next highest full cent or CAD 965.13 as it has a fractional cent of 5/10ths or greater. *AC share 818.866 is rounded to CAD 818.87 as it has a fractional cent of 5/10ths or greater.


20 5/22/05

Example 3: Joint Continental U.S. fare, round-trip Fare Class: QJSE21NR Routing: ABR—NW—BIL—GQ—FCA (Round Trip portion is not shown) 1. Fare Type look up of the QJSE21NR determines that this is an XPN—which is in the Economy Cabin. 2. Search in the Economy Cabin for fares to be used as prorate factors 3. Results return the following fares:

ABR—BIL NW Unrestricted Y class fare at USD 971.16 with a fare type of EU and no Category 23 provision BIL—FCA GQ Unrestricted Y class fare at USD 648.37 with a fare type of EU and no Category 23 provision

4. Formula calculation

Fare Amount: USD 421.40 (r/t) USD 210.70 (o/w) NW Local (o/w) Fare USD 971.16 GQ Local (o/w) Fare USD 648.37 Total Local Fare USD 1,619.53 Fare Ratio USD 210.70//USD 1,619.53 = .13009 or 13.009% NW Share USD 126.34* (971.16 × 13.009% = 126.338) GQ Share USD 84.36* (648.37 × 13.009% = 84.346) Total Share USD 210.70 *NW Share USD 126.338 is rounded to USD 126.34 as it has a fractional cent of 5/10ths or greater. *GQ Share USD 84.346 is rounded to 84.35 as it has a fractional cent of 5/10ths or greater and is further adjusted to 84.36 in order to total the amount to be prorated.


21 5/22/05

Example 4: Joint Continental U.S. fare, one-way fare Fare Class: FJ Routing: CLE—CO—MKC—US (operated by a *Partner ZV)—MHK *Note: Operating airlines fares are never considered for selection unless the marketing airline does not have any Normal fares in any Cabin. 1. Fare Type look up of the FJ determines that this is an FU fare type—which is in the First Class Cabin 2. Search in the First Class Cabin for fares to be used as prorate factors 3. Results return the following fares:

CLE—MKC CO Unrestricted F class fare at USD 1,344.19 with an FU fare type

MKC—MHK No fares were found for US in the First class cabin Fare type search for US defaults to Business Cabin but no Business Class fare exists. Fare type search for US defaults to Economy Cabin for an unrestricted Economy fare first. US Unrestricted Y class fare at USD 346.98 with an EU fare type was found.


Fare Amount: USD 1,371.16 CO Local Fare USD 1,344.19 US Local Fare USD 346.98 Total Local Fares USD 1,691.17 Fare Ratio USD 1,371.16/USD 1,691.17 = .81077 or 81.077% CO Share USD 1,089.83* (1,344.19 × 81.077% = 1,089.828) US Share USD 281.33* (346.98 × 81.077% = 281.320) Total Share USD 1,371.16

*CO Share USD 1,089.828 is rounded to USD 1,089.83 as it has a fractional cent of 5/10ths or greater. *US Share is adjusted from USD 281.32 to 281.33 to total the amount to be prorated.


22 5/22/05

Example 5: Joint Continental U.S.-Puerto Rico/U.S. Virgin Islands fare, round-trip Fare Class: HJHXE14N Routing: DFW—DL—SJU—9K—STX (Round Trip is not shown) 1. Fare Type look up of the HJHXE14N determines that this is XPN—which is in the Economy Cabin. 2. Search in the Economy Cabin for fares to be used as prorate factors 3. Results return the following fares:

DFW—SJU DL Unrestricted Y fare USD 1,537.00. SJU—STX 9K Unrestricted Y fare USD 649.00.

4. Formula Calculation

Fare Amount: USD 858.00 (r/t) USD 429.00 (o/w) DL Local (o/w) Fare USD 1,537.00 9K Local (o/w) Fare USD 649.00 Total Local Fares USD 2,186.00 Fare Ratio USD 429.00/USD 2,186.00 = .19624 or 19.624% DL (o/w) Share USD 301.62 (1,537.00 × 19.624% = 301.620) 9K (o/w) Share USD 127.38*(649.00 × 19.624% = 127.359) Total Shares USD 429.00

*9K’s share was rounded up to USD 127.36 from 127.359 as it has a fractional cent of 5/10ths or greater and is then further adjusted to 127.38 to total the amount to be prorated.

SECTION II PASSENGER PRORATE RULES 11 THROUGH 31

23 7/01/05

RULE 11—STRAIGHT-RATE PRORATE FORMULA USED IN PRORATING FARES FOR WHICH PRORATES ARE NOT PROVIDED IN PIPPS

A. Straight-Rate Prorate Formula

1. Application

This Straight-Rate Prorate formula applies when prorating fares for which prorates are not published in PIPPS and to prorate all other North American fares requiring proration not covered in Rules 1 & 2. In other words this rule will cover the proration of all on-line and unpublished joint fare prorates such as the on-line portions of joint fares and fares which have the same marketing airline but a codeshare with a different operating airline.

2. Prorate Factors

a. The local fares will be selected as prorate factors as defined in Rule 3 for each Marketing Airline's portion to and from the interchange point specified within a joint fare. The local fares as specified below will be selected as prorate factors for each Marketing Airline as defined in Rule 3 and for each coupon when prorating online fares or online portions of joint fares if no intermediate construction point(s) is involved.

b. If an intermediate construction point(s) is involved, use the local fare as specified by the

methodology listed in Rule 3. The intermediate construction point(s) may or may not be shown on the ticket.

c. When a joint fare contains a segment wholly within Canada and there is no U.S. dollar amount

published for the segment, the applicable Canadian dollar amount is divided by the applicable Canadian conversion rate used by PIPPS. The adjusted amount is used as a prorate factor. Conversely, if no Canadian dollar fare exists, the applicable U.S. dollar fare is multiplied by the applicable “PIPPS conversion rate” and is used as a prorate factor.

3. Formula

a. Divide the sum of the local fares into the amount to be prorated. Carry the percentage factor to five digits beyond the decimal, dropping all digits beyond the fifth (seven digits for CIPS).

b. Multiply each local fare by the percentage factor increasing the amounts arrived at to the next

higher full cent if the computed value has a fractional cent of 5/10ths or greater. c. Adjust the prorate amount applicable to the last segment in the routing so that the total of the

prorate amounts equals the fare amount to be prorated.


24 7/01/05

Example 1: Joint intra Canada with on-line segment Fare Class: YJ Routing: YYC—AC—YWG—JV—YXL—JV—YQT 1. Fare Type look up of the YJ determines that this is an ER—which is in the Economy Cabin 2. Search in the Economy cabin for fares to be used as prorate factors 3. Results return the following fares:

YYC—YWG (two fares were found) YWG—YQT (No through fare was found thus, local fares for YWG—YXL and YXL—YQT were used) YYC—YWG AC Restricted Economy Y class fare at CAD 1,100.00 with a fare type of ER and a Category 23 footnote which states “must be used in proration”. AC Restricted Economy Y class fare at CAD 1,500.00 with a fare type of EU and no footnote. Here the AC Y class fare at CAD 1,100.00 with a fare type of ER would be selected as the footnote indicates it must be selected. YWG—YXL JV Restricted Economy fare type ER CAD 800.00 YXL—YQT JV Restricted Economy fare type ER CAD 700.00


Fare Amount: CAD 2,000.00 AC Local Fare YYC—YWG CAD 1,100.00 JV Local Fare YWG—YXL CAD 800.00 JV Local Fare YXL—YQT CAD 700.00 Total Local Fares CAD 2,600.00 Fare Ratio CAD 2,400/CAD 2,600 = .92307 or 92.307% AC Share CAD 1,015.38 (1100 × 92.307% = 1,015.377) JV Share CAD 738.46 (800 × 92.307% = 738.456) JV Share CAD 646.16* (700 × 92.307% = 646.149) Total Share: 2,400.00 *JV share CAD 646.149 is rounded 646.15 as it has a fractional cent of 5/10ths or greater and is further adjusted to CAD 646.16 to total the amount to be prorated.


25 7/01/05

Example 2: Joint Continental U.S.-Hawaii one-way fare Fare Class: F Routing: PIT—US—CHI—UA—HNL 1. Fare Type look up of the FJ determines that this is an FU fare type—which is in the First Class Cabin. 2. Search in the First Class Cabin for fares to be used as prorate factors 3. Results return the following fares:

PIT—CHI US Unrestricted First Class fare type 1,078.14

CHI—HNL UA Unrestricted First Class fare type 2,581.41


Fare Amount: USD 2,324.52 US Local Fare USD 1,078.14 UA Local Fare USD 2,581.41 Total Local Fares USD 3,659.55 Fare Ratio USD 2,324.52/USD 3,659.55 = .63519 or 63.519% US Share USD 684.82 (1078.14 × 63.519% = 684.823) UA Share USD 1,639.70* (2581.41 × 63.519% = 1,639.685) Total Shares USD 2,324.52

*UA Share USD 1,639.685 is rounded to USD 1,639.69 as it has a fractional cent of 5/10ths or greater and it is further adjusted to 1,639.70 to total the amount to be prorated.


26 7/01/05

Example 3: Joint Continental U.S.-Alaska one-way fare Fare Class: FJ Routing: LAX—NW—PDX—AS—ANC Local F fare 1. Fare Type lookup of the FJ determines that this is an FU which is in the First Class Cabin 2. Search in the First Class Cabin for fares to be used as prorate factors 3. Results return the following fares:

LAX—PDX NW Unrestricted First Class P fare is 1,209.77 PDX—ANC AS Unrestricted First Class F fare is 2,030.77


Fare Amount: USD 2,317.13 NW Local Fare USD 1,209.77 AS Local Fare USD 2,030.77 Total Local Fares USD 3,240.54

Fare Ratio USD 2,317.13/USD 3,240.54 = .71504 or 71.504% NW Share USD 865.03 (1,209.77 × 71.504% = 865.033) AS Share USD 1,452.10* (2,030.77 × 71.504% = 1,452.081) Total Shares USD 2,317.13

*AS Share 1,452.08 is adjusted to USD 1,452.10 to total the amount to be prorated.


27 7/01/05

Example 4: Joint Business Class one-way fare Fare Class: J06 Routing: FAY—DL—ATL—CO—LAX 1. Fare Type lookup of the J06 determines that this is a BR—which is in the Business Class Cabin 2. Search in the Business Class Cabin for fares to be used as prorate factors 3. Results return the following fares:

FAY—ATL

No local Business Class fare types, default to Economy Cabin DL has three Unrestricted Economy fares: Y, Y1 and Y06 DL Y = 622.33 (routing 76), Y06 592.56 (routing 76), Y1 622.33 (routing 976) The DL Y is selected as the highest fare regardless of routing

ATL—LAX CO had two Unrestricted Economy Y Class Fares: Y = 1,506.05 and Y8 = 1,070.70 The CO Y is selected as the highest eligible Y fare.


Fare Amount: USD 1,401.86 DL Local Fare USD 622.33 CO Local Fare USD 1,506.05 Total Local Fares USD 2,128.38

Fare Ratio USD 1,401.86/USD 2,128.38 = .65865 or 65.865% DL Share USD 409.90* (622.33 × 65.865% = 409.897) CO Share USD 991.96* (1,506.05 × 65.865% = 991.959) Total Shares USD 1,401.86

*DL Share USD 409.897 is rounded up to USD 409.90 as it has a fractional cent of 5/10ths or greater. *CO Share USD 991.959 is rounded up to USD 991.96 as it has a fractional cent of 5/10ths or greater.


28 7/01/05

Example 5. Fare Class: HE14NR Routing: PHL—AA—ATL—AA—MIA Local ½ RT HE14NR 1. Fare Type lookup of the HE14NR determines that this is an XPN—which is in the Economy Class Cabin 2. Search in the Economy Class Cabin for fares to be used as prorate factors 3. Results return the following fares:

PHL—ATL AA local Economy Unrestricted Y fare 795.35 ATL—MIA AA local Economy Unrestricted Y fare 681.86


Fare Amount: USD 467.44 AA Local Fare USD 795.35 AA Local Fare USD ,681.86 Total Local Fares USD 1,477.21

Fare Ratio USD 467.44/USD 1,477.21 = .31643 or 31.643% AA Share USD 251.67 (795.35 × 31.643% = 251.672) AA Share USD 215.77* (681.86 × 31.643% = 215.760) Total Shares USD 467.44

*AA share adjusted from USD 215.76 to USD 215.77 to total the amount to be prorated.


29 7/01/05

Example 6. Fare Class: NHOE30N ½ RT Local Fare Routing: CHI—CO—LAX—CO—HNL 1. Fare Type lookup of the NHOE30N determines that this is an XAN—which is in the Economy Class Cabin 2. Search in the Economy Class Cabin for fares to be used as prorate factors 3. Results return the following fares:

CHI—LAX CO has three Unrestricted Economy fares Y = USD 1,348.84, Y8S = USD 1,200.00, H8 = USD 929.30 The Y fare of 1,348.84 is selected as the highest eligible fare LAX—HNL CO has two Unrestricted Economy fares LAX—HNL: Y = 1,112.67, Y8S = 713.79 The Y fare of USD 1,112.67 is selected as the highest eligible fare.


Fare Amount: USD 372.74 CO Local Fare USD 1,348.84 CO Local Fare USD 1,112.67 Total Local Fares USD 2,461.51

Fare Ratio USD 372.74/USD 2,461.51 = .15142 or 15.142% CO Share USD 204.24 (1348.84 × 15.142% = 204.241) CO Share USD 168.50*(1112.67 × 15.142% = 168.480) Total Shares USD 372.74

*CO second share is adjusted from 168.48 to 168.50 to total the amount to be prorated.


30 7/01/05

Example 7. Fare Class: MB1ZN Routing: CHI—UA—DEN—UA—LAX 1. Fare type lookup of the MBIZN determines that this is a SIP—which is in the Economy Cabin 2. Search in the Economy Class Cabin for fares to be used as prorate factors 3. Results return the following fares:

CHI—DEC UA Unrestricted Y is selected USD 1,161.86 DEN—LAX UA Unrestricted Y is selected USD 941.40


Fare Amount: USD 553.02 UA Local Fare USD 1,161.86 UA Local Fare USD 941.40 Total Local Fares USD 2,103.26

Fare Ratio USD 553.02/USD 2,103.26 = .26293 or 26.293% UA Share USD 305.49* (1161.86 × 26.293% = 305.487) UA Share USD 247.53* (941.40 × 26.293% = 247.522) Total Shares USD 553.02

*The first UA Share is rounded up to 305.49 from 305.487 as it has a fractional cent of 5/10 or greater and the second UA share is adjusted to 247.53 to total the amount to be prorated.


31 7/01/05

Example 8. Fare Class: Y Routing: YMQ—DL—BOS—AA—CHI—AA—SAN (BOS—CHI and CHI—SAN are both via AA, therefore, use AA's through CAD local fare BOS—SAN as a prorate factor). 1. Fare type lookup of the Y fare determines that this is an EU—which is in the Economy Cabin. 2. Search in the Economy Class Cabin for fares to be used as prorate factors 3. Results return the following fares:

YMQ—BOS DL Unrestricted Y is selected CAD 1,193.00 BOS—SAN AA Unrestricted Y USD 1,446.51 × CAD PIPPS conversion rate (See note) = CAD 2,227.63


Fare Amount: CAD 3,456.00 DL Local Fare CAD 1,193.00 AA Local Fare CAD 2,227.63 Total Local Fares CAD 3,420.63

Fare Ratio CAD 3,456.00/CAD 3,420.63 = 1.01034 or 101.034% DL Share CAD 1,205.34* (1,193.00 × 101.034% = 1,205.335) AA Share CAD 2,250.66 (2,227.63 × 101.034% = 2,250.663) Total Shares CAD 3,456.00

*DL Share CAD 1,205.335 is rounded up to CAD 1,205.34, as it has a fractional cent of 5/10 or greater.

Routing: BOS—AA—CHI—AA—SAN On-Line Prorate of Joint Y fare is CAD 2,250.57 BOS—CHI AA CAD Local Y Fare 1,750.58 CHI—SAN AA CAD Local Y Fare 2,075.78

AA BOS—CHI Segment Share CAD 1,750.58 AA CHI—SAN Segment Share CAD 2,075.78 Total Local fares each coupon CAD 3,826.36

Fare Ratio CAD 2,250.57/CAD 3,826.36 = .58817 or 58.817% AA BOS—CHI Segment Share CAD 1,029.64* (1750.58 × 58.817% = 1,029.638) AA CHI—SAN Segment Share CAD 1,220.93* (2075.78 × 58.817% = 1,220.911) Total Shares CAD 2,250.57

*The first AA Share 1,029.638 is rounded up to 1,029.64 as it has a fractional cent of 5/10ths or greater and the second AA share is adjusted from 1,220.91 to 1,220.93 to total the amount to be prorated. NOTE: To construct a CAD local to use for prorating purposes refer to Rule 11.A.2.c. (U.S. Dollar Fare ×

PIPPS rate).


32 7/01/05

RULE 12—PUBLISHED JOINT FARES—UNPUBLISHED PRORATES/INCORRECT AGREED PRORATES

A. When a specifically published joint fare is provided in PIPPS, but no prorate amounts are shown, such joint fare will be prorated in accordance with Rule 2, the Joint Fare Prorate formula.

B. When an “/A/” is shown on the prorate line of PIPPS and the total of the prorate amounts that are listed do not equal

the specifically published joint fare that is shown in PIPPS, the joint fare will be prorated by applying the Joint Fare Prorate formula (Rule 2), using the listed prorates as prorate factors.

Example Agreed Prorate “A” with both airlines agreed to specified amounts

Joint Fare YJ one way Fare Amount: CAD 1,235.00 Routing: YFB—7F—YOW—AC—YMQ

Agreed Prorate shares: YFB—YOW 7F Agreed share is: CAD 1,005.25 YOW—YMQ AC Agreed share is: CAD 229.75

The joint fare is updated to CAD 1,535.00 but 7F and AC do not update their agreed shares. 1. The updated joint fare is reprorated using the existing agreed shares as prorate factors 2. The sum of the agreed prorate shares CAD 1,005.25 + CAD 229.75 = 1,235.00 3. Divide the updated joint fare by the sum of the agreed shares Fare Ratio CAD 1,535.00/CAD 1,235.00 = 1.24291 or 124.291% 4. 7F Share CAD 1,249.43 (1,005.25 × 124.291% = CAD 1,249.43) AC Share CAD 285.57 ( 229.75 × 124.291% = CAD 285.57) Total Shares CAD 1,535.00

C. Once missing or corrected prorates are provided in PIPPS, they will be effective on the date shown in PIPPS and will

not be applied retroactively.


33 7/01/05

RULE 13—REVISED LOCAL FARES—EFFECTS ON PRORATES

Principles

The prorates provided in PIPPS apply until revised.

Explanation

When it occurs that prorates published in PIPPS are no longer the result of applying Rule 11, Straight-Rate Prorate Formula used in Prorating Fares for which Prorates are not Provided in PIPPS, due to the fact that a local fare used as a prorate factor has been revised and the joint fare has not, then the PIPPS prorates are to be accepted for interline settlement until such time as revised prorates are actually calculated in PIPPS. Prorate revisions are to be applied only to tickets on which transportation commences from point of origin on or after the effective date of the revised prorates and are not effective retroactively to tickets on which transportation commenced prior to that date.


34 7/01/05

RULE 14—CONSTRUCTION POINTS—RECOGNITION IN PRORATING

Principle

When a through routing on the ticket is not covered by a specifically published single through fare, the division of the combination of fares applicable to such routings, will be on the same basis as the fare combination used in determining the total fare, recognizing all construction points whether or not they are reflected in the good for passage portion of the ticket. Each of the fares to/from the point of combination will be prorated by applying the Straight-Rate Prorate formula (Rule 11). Example 1: Where the fare combination point(s) is ticketed. Good for passage reflects: Airline Locations Fare Basis Code AA—YTO—LGA F UA—LGA—ORD F AA—ORD—STL F Fare Calculation Ladder: YTO—AA—NYC 60.00 F UA CHI AA STL 99.07

CONSTRUCTS PRORATES YTO—NYC—Local USD 60.00 USD 60.00 NYC—CHI—(Joint 62.30 CHI—STL— Fare) 99.07 36.77 USD 159.07 USD 159.07

Example 2: Where the fare combination point(s) is not ticketed. Good for Passage reflects: CXR Locations Fare Basis Code AA—YTO—ORD F UA—ORD—STL F Fare Calculation Ladder: YTO—AA—NYC 60.00 F AA CHI UA STL 99.07

CONSTRUCTS PRORATES YTO—NYC—Local USD 60.00 USD 60.00 NYC—CHI—(Joint 62.30 CHI—STL— Fare) 99.07 36.77 USD 159.07 USD 159.07


35 7/01/05

RULE 15—VALUE OF ENDORSED/VOLUNTARILY REROUTED COUPON(S)

A. Honoring for Interline Use Principle Voluntarily rerouted ticket coupons are those accepted by the honoring airline for the same value that is applicable to the original routing (including the airlines in the original routing). Explanation For interline settlement purposes, voluntary rerouting will not change the original value of any ticket coupon. Example 1. DFW—AA (F)—CHI—UA (F)—WAS—Joint First Class Fare (No Stopover)

PRORATES AA DFW—CHI USD 1029.30 (See note) UA CHI—WAS 1220.00 USD 2249.30

NOTE: If CO carried the passenger DFW—CHI, it would be entitled to AA's prorate share (USD 1029.30) of the total ticket value of 2249.30 for the coupon it honored even though there is no joint fare DFW—CO (F)—CHI—UA (F)—WAS or even if there was a DFW—CO—CHI—UA—WAS Joint Fare with different amounts and/or settlement shares.


36 7/01/05

Exception 1. Those portions of an on-line ticket that are honored under the interchangeable routing rule will be prorated in accordance with Rule 24. Example 2. Original Routing: DEN—NW—CHI—NW—STT—US—STX Local BAP3 One-Way Economy Restricted fare USD 1,600.00 Interchangeable Routing: DEN—AA—CHI—AA—STT—US—STX 1. Fare type lookup of the BAP3 determines that this is an ER—which is in the Economy Cabin 2. Search in the Economy Class Cabin for fares to be used as prorate factors 3. Results return the following fares:

DEN—CHI AA Unrestricted Y is selected USD 205.00 CHI—STT AA Unrestricted Y is selected USD 995.00 STT—STX US Unrestricted Y is selected USD105.00


Fare Amount: USD 1,600.00 AA Local Y Fare USD 205.00 AA Local Y Fare USD 995.00 US Local Y Fare USD 105.00 Total Local Fares USD 1,305.00

Fare Ratio USD 1,600/1,305 = 1.22605 or 122.605% AA Share = USD 1219.92* (995.00 × 122.605% = 1,219.92) AA Share = USD 251.34 (205.00 × 122.605% = 251.34) US Share = USD 128.74 (105.00 × 122.605% = 128.74) Total Shares 1,600.00

*AA first Share USD 1,219.919 is rounded up to USD 1,219.92 as it has a fractional cent of 5/10ths or greater. *US Share USD 128.735 is rounded up to USD 128.74 as it has a fractional cent of 5/10ths or greater.


37 7/01/05

Exception 2. Coupon(s) of voluntarily rerouted tickets issued for specifically published joint fares for which specific prorates have been agreed but not published will be settled in accordance with Rule 12. Example 3. DSM—AA—STT—9K—STX Joint YJ10 (o/w) USD 1,100.00 Agreed (“A”) Prorates with zero dollar shares 1. Fare type lookup of the YJ10 determines that this is an ER—which is in the Economy Cabin 2. Search in the Economy Class Cabin for fares to be used as prorate factors 3. Results return the following fares:

DSM—STX AA Unrestricted Y is selected USD 995.00 DSM—STT 9K Unrestricted Y is selected USD 205.00


Fare Amount: USD 1,100.00 AA Local Y Fare USD 995.00 9K Local Y Fare USD 205.00 Total Local Fares USD 1,200.00 Fare Ratio USD 1,100/1,200 =.91666 or 91.666% AA Share USD 912.08*(995.00 × 91.666%) 9K Share USD 187.92*(205.00 × 91.666%) Total Shares USD 1,100.00

*AA Share USD 912.076 is rounded up to USD 912.08 as it has a fractional cent of 5/10ths or greater. *9K Share USD 187.915 is rounded up to USD 187.92 as it has a fractional cent of 5/10ths or greater.


38 7/01/05

B. Surrendering Unused Coupon

Principle When a passenger surrenders an unused coupon in order to use the subsequent coupon in its proper sequence, the airline honoring the latter coupon will receive the value assigned to both such coupons. Example 2. COS—US (F)—DEN—UA (F)—CHI—AA (F)—MIA Three airline Joint First Class Fare (No Stopover)

PRORATES US COS—DEN USD 303.29 UA DEN—CHI 832.24 AA CHI—MIA 788.19 USD 1923.72

The passenger desires to originate his trip at DEN and surrenders the COS—DEN coupon to UA, which must be removed as a precedent to the use of the DEN—CHI coupon, and thereby becomes invalid for transportation. UA will bill the issuing airline USD 303.29 + USD 832.24 (total value of USD 1135.53) for the COS—DEN—CHI coupons.


39 7/01/05

RULE 16—VALUE OF INVOLUNTARY REROUTED COUPON(S)

A. Reissued Tickets

Principle When a ticket is reissued pursuant to DGR-1, Rule 240XX—“Flight Delays/Cancellations, paragraph (C) Schedule Irregularity” in order to provide coupons for an involuntary rerouting via airlines that will transport such passengers at no additional cost to the passenger, the coupons shall be settled at the applicable rate as indicated in Section C, Appendices Q and S of the ACH Manual of the full normal local adult fare applicable to each coupon. In addition, refer to Ticketing-Resolution 120.20—Involuntary Rerouting of Passengers, paragraph 4. The cabin class of service on which the settlement shall be based will be determined by the fare class code(s) indicated in the Reservation Box(es) of the new ticket, or if not shown then the applicable Coach or Standard Class Fare for the honoring airline for the date of reissue must be used. Example 1. Original Routing: DFW—CO (Y)—MKC Local USD 567.44 Revised Routing: DFW—AA (F)—MEM—DL (Y)—MKC CO reissued DFW—MKC ticket to provide coupons for AA and DL sectors of the involuntary rerouting.

LOCAL COUPON VALUE (12%) AA (F) DFW—MEM USD 985.12 USD 118.21 DL (Y) MEM—MKC 702.33 84.28

Example 2. Original Routing: CHI—HP (Y)—SFO Local USD 1380.47 Revised Routing: CHI—AA (F)—LAX NW (Y)—SFO HP reissued CHI—SFO ticket to provide coupons for AA and NW sectors of the involuntary rerouting.

LOCAL COUPON VALUE CHI—LAX (F) USD 2162.79 × 12% USD 259.53 LAX—SFO (Y) USD 615.81 × 12% USD 73.90


40 7/01/05

B. Tickets Honored Without Reissuance

Principle When a ticket is honored pursuant to DGR-1, Rule 240XX—“Flight Delays/Cancellations, paragraph (C) Schedule Irregularity” but has not been reissued or endorsed by the original plating marketing airline, such ticket will be accepted by the honoring airline for the same value as applicable to the original routing. Example 3. Routing: DEN—F9 (Y)—OMA—UA (Y)—NYC (No Stopover OMA) Joint Coach Fare USD 1,371.16

PUBLISHED PRORATES F9 (Y) DEN—OMA USD 623.25 UA (Y) OMA—NYC 747.91 USD 1,371.16

NOTE: Should the honoring airline accept the OMA—NYC coupon and accommodate the passenger in its First Class Cabin, that airline will only receive UA's "Y" prorate.


41 5/22/05

RULE 24—PRORATION OF ON-LINE FARES OR ON-LINE PORTIONS OF JOINT FARES

Principle On-line tickets and on-line portions of interline tickets shall be prorated from origin to destination over each ticketed point if no intermediate construction point(s) is involved; or if an intermediate construction point(s) is involved, Rule 14 will apply. The Straight-Rate Prorate formula (Rule 11) will apply to all other on-line fares or on-line portions of joint fares. The factors to be used when applying the Straight-Rate Prorate formula for on-line fares and on-line portions of interline fares will be determined by Rule 11. When a local fare is specifically published and applicable to a portion of the itinerary, but the same or a lower amount would result from combining two or more local fares between the same points and via the same routing, the latter fares shall be disregarded and the through published local fare shall be prorated over the ticketed points.

Explanation The value of each coupon of an on-line ticket or the on-line portion of an interline ticket which is involved in interline settlement, shall be determined by prorating the local fares between each ticketed point into the local on-line through fare or the on-line portion of a joint fare, if an intermediate construction point(s) is not involved. If an intermediate construction point(s) is involved, the construction point(s) will be recognized by prorating each of the fares to/from the construction point(s) separately. The construction point(s) may or may not be shown on the ticket. The value of each coupon involving an intermediate construction point(s) will be determined by prorating the local fares for each coupon to/from the construction point into the on-line through fare or the on-line portion of a joint fare applicable to/from each construction point. All coupons of an airline's sector may be accumulated and billed collectively as one amount. Any airline honoring one or more coupons of such a ticket under the voluntary rerouting, endorsement or interchange rule will accept settlement on this basis.

NOTE 1

In case the same fare can be constructed by using two or more combinations of local fares and the actual fare combination point cannot be determined from the fare construction ladder then, the division of revenue will be based on that which will allow the most revenue to the originating coupon.

NOTE 2

Transportation between U.S./Canada and Puerto Rico/U.S. Virgin Islands is considered domestic service.


42 7/01/05

RULE 25—PRORATES APPLICABLE TO ROUND TRIP, CIRCLE TRIP OR OPEN JAW FARES

A. Round Trip/Circle Trip Distribution

Tickets showing a fare calculation with a total fare amount only, for round trip or circle trip transportation (no

indication of a break in the fare), will be prorated from end to end by applying the Straight Rate Prorate Formula as shown in Rule 11. The local fares for each coupon will be used as prorate factors.

B. Open Jaw Trip Distribution

Tickets with a surface sector (other than at the point of ticket Origin/Destination) or where the outward point of departure and the inward point of arrival are different will be prorated from end to end by applying the Straight Rate Prorate Formula as shown in Rule 11. The local fares for each coupon will be used as prorate factors. Example Round trip fare with no indication of break in the fare —USD 512.00 Routing: FAT—UA—QPE21CNX—DEN—UA—QPE21CNX—YTO—UA—QPE21NCX—DEN—UA—

QPE21NCX—FAT

LOCAL FARES PRORATES FAT—DEN UA USD 1,036.28 USD 97.09 DEN—YTO UA 1,696.00 158.90 YTO—DEN UA 1,696.00 158.90 DEN—FAT UA 1,036.28 97.11 USD 5,464.56 USD 512.00

NOTE: In the event the round trip fare is not divisible by two, the odd cent will be applied to the going portion of the journey.


43 7/01/05

RULE 26—PRORATION OF VISIT ANOTHER COUNTRY LOCAL, JOINT, AND OPEN-JAW VISIT U.S.A. FARES

Principle

Local, Joint and Open-Jaw VUSA Fares which are published within the general rules tariff as a single amount for multiple coupons off shall be prorated on the basis of the actual transportation. If there are no international sectors in the amount to be prorated, the Straight-Rate Prorate formula (Rule 11) will apply and the local fares for each coupon will be used as prorate factors. If the amount to be prorated includes an international sector (i.e., SFO—MEX), proration will be based on the IATA methodology. Example 1. Joint Circle Trip Visit U.S.A. Fare—USD 743.52 Routing: NYC—UA—CHI—UA—LAX—HP—LAS—UA—WAS—DL—NYC (Prorated using ACH Methodology)

LOCAL FARES PRORATES NYC—CHI UA USD 880.93 USD 138.57 CHI—LAX UA 1,348.84 212.17 LAX—LAS HP 601.86 94.67 LAS—WAS UA 1,351.63 212.61 WAS—NYC DL 543.26 85.50 USD 4,726.52 USD 743.52

Example 2. Open Jaw Visit U.S.A. Fare—USD 926.85 Routing: BWI—US—ATL—US—LAX—UA—SEA—UA—DEN—UA—CHI—UA—WAS—US—NYC (Prorated using ACH Methodology)

LOCAL FARES PRORATES BWI—ATL US USD 775.81 USD 103.24 ATL—LAX US 1,587.91 211.30 LAX—SEA UA 899.53 119.70 SEA—DEN UA 1,070.70 142.48 DEN—CHI UA 1,161.86 154.61 CHI—WAS UA 1,011.16 134.56 WAS—NYC US 457.67 60.96 USD 6,964.64 USD 926.85


44 7/01/05

Example 3. Visit U.S.A. Fare USD 635.45 VUSA ticket issued in conjunction with an international ticket that is linked by the information provided in the endorsement box. Routing: BOS—CHI—LAX—LAS—NYC—BOS (Prorated using ACH Methodology)

LOCAL FARES PRORATES BOS—CHI USD 1,136.74 USD 141.00 CHI—LAX 1,353.49 167.89 LAX—LAS 601.86 74.65 LAS—NYC 1,450.23 179.89 NYC—BOS 580.47 72.02 USD 5,122.79 USD 635.45

Example 4. Visit USA Online with extensions Routing: HNL(extension)—CO—HOU—CO—RIC—CO—HOU—CO—LAX—CO (extension)HNL Peak Adult 3 Coupons + 2 Peak Adult Coupon Extensions Extensions shown on the ticket as part of the ATBP. Fare: USD 929

LOCAL FARE PRORATES HNL—HOU CO 1534.64 USD 238.94 PXTRA HOU—RIC CO 1028.84 160.19 PLVNP3 RIC—HOU CO 1028.84 160.19 PLVNP3 HOU—LAX CO 1261.40 196.40 PLVNP3 LAX—HNL CO 1112.67 USD 173.28 PXTRA


45 7/01/05

Example 5. Visit USA Online with extensions Routing: HNL(extension)—CO—HOU—CO—RIC—CO—HOU—CO—LAX—CO (extension)HNL Peak Adult 3 Coupons + 2 Peak Adult Coupon Extensions Fare Basis Codes for Extensions are shown separately Fare: USD 929 Extensions not included as part of the ATBP.

LOCAL FARE PRORATES FARE BASIS HNL—HOU CO 1,534.64 260.00 (extension) PXTRA HOU—RIC CO 1,028.84 139.17 PLVNP3 RIC—HOU CO 1,028.84 139.17 PLVNP3 HOU—LAX CO 1,261.40 170.66 PLVNP3 LAX—HNL CO 1,112.67 220.00 (extension) PXTRA

Example 6. Visit USA Online with international “Extension” to the Bahamas included in the ATBP (MPA rules apply). Routing: NYC—CO—WAS—CO—MIA—CO extension to NAS—CO—MIA—CO—ORL—CO—WAS Fare Basis: Adult 4 coupons + All Year Adult Extensions (MIA—NAS) Total Fare: USD 979 Extensions shown on the ticket as part of the ATBP.

PRORATE FACTOR PRORATES NYC—WAS CO 549 107.15 WAS—MIA CO 1605 313.12 MIA—NAS CO 480 93.64 NAS—MIA CO 480 93.64 MIA—ORL CO 522 101.84 ORL—WAS CO 1382 269.61


46 7/01/05

RULE 27—PRORATES APPLICABLE TO DISCOUNTED FARES BASED ON A PUBLISHED PERCENTAGE

A. Discount Fares based on a published percentage referenced in Categories 19-22 “Discounts” of the ATPCO Automated Rules System in the fare rule, or in the General Rule of the fare being used for proration.

1. The prorate calculation may be done (instead of prorating the calculated discounted fare) by applying the

Straight-Rate Prorate formula (Rule 11) for the full published and then applying the published discount percentage to the prorates of the published fare to obtain the value for each coupon of the discounted fare.

Example 1. Ticket was priced by using a Published Joint Fare NYC—CHI—HNL USD 275.00 which had Cat 19 (Child discount) fare rule of 66 2/3% or for a total Child’s fare of USD 183.33 (275.00 × .66666).

CH DISC % PRORATES OF PUBLISHED ROUTING PUBLISHED FARE IN RULE CH. DISC. PRORATES NYC—CHI YW AA USD 62.49 × 66 2/3% = USD 41.66 CHI—HNL YW UA 212.51 × 66 2/3% = 141.67 USD 275.00 × 66 2/3% = USD 183.33

2. When a fare based on a percentage, e.g., child, family, employee, is raised to a minimum fare amount such minimum fare will be prorated by applying the Straight-Rate Prorate Formula (Rule 11), using the published local fares as prorate factors for each portion. Example 2. Employee ID75% Discount Routing: DEN—YV (Y) COS—YV (Y) PUB (No stopover) DEN—PUB "Y" Local USD 38.00 × 25% = USD 9.50 YV minimum discount fare of USD 10.00 is applicable so instead of applying the discount percent to the prorate shares of the full Y fare the minimum fare of USD10.00 is prorated.

LOCAL FARES MINIMUM FARE PRORATES DEN—COS USD 278.14 USD 8.84 COS—PUB 36.28 1.16 USD 314.42 USD10.00


47 7/01/05

3. In the event a published fare is allowed multiple discounts the discount fare is prorated as follows:

Example 3. A published Y joint fare NYC—LAX is 174.07 and allows for an employee discount of 25% (or 75% of the fare) and also allows for a 66-2/3 % child discount percentage would be calculated as follows:

PUBLISHED JOINT EMPLOYEE CHILD ROUTING FARE PRORATES FARE PRORATES FARE PRORATES NYC—CHI USD 60.96 × 75% = USD 45.72 × 66 2/3% = USD 30.48 CHI—LAX 113.11 × 75% = 84.83 × 66 2/3% = 56.55 USD 174.07 × 75% = USD 130.55 × 66 2/3% = USD 87.03


48 7/01/05

RULE 28—PRORATION OF EXCESS BAGGAGE CHARGES

Principle

Settlement of excess baggage charges for tickets where the collection is under the piece concept for domestic travel only (Continental U.S., Alaska, Hawaii, Canada, Puerto Rico, U.S. Virgin Islands) shall be based on the total charges collected and divided equally over all coupons covered by the excess baggage charge, i.e.,:

One coupon involved—100% Two coupons involved—50% each Three coupons involved—33 1/3% each Four coupons involved—25% each


49 7/01/05

RULE 29—PRORATION OF SPECIFICALLY PUBLISHED STOPOVER CHARGES Principle

Regardless of whether a specifically published stopover or transfer charge published in Category 8 —“ Stopovers” or Category 9—“Transfers” of the ATPCO Automated Rules Service for the rule of the corresponding prorate fare applies to an intermediate on-line city or to an interline transfer city, the applicable stopover/transfer charge that has been collected on the ticket shall be divided equally between the two flight coupons covering transportation to and from the stopover/transfer city. The Stopover City will be determined by the City preceding the “S” in the fare calculation ladder unless the “S” appears at the end of the fare calculation ladder. In this case then the stopover point is determined to be the point that has an “O” designated on the Good for Passage coupon within a fare break point. In the event that multiple or no points have an “O” within the Good for Passage area within a farebreak point then the stopover amount will be divided evenly across all such coupons. NOTE: Settlement of stopover charges applicable to international journeys that include multiple domestic segments default to IATA procedures per IATA MPA, Section B.7. (See Example 4 below) Example 1: Interline Stopover Charge Routing: SEA--AS (Y)--YVR (defined as the Stopover point) – AC(Y)--YTO Fare Constructs

STOPOVER DIVISION OF FARE LADDER PRORATES CHARGE TOTAL PRORATE AS (Y) SEA—YVR USD 261.94 + USD 2.50 = USD 264.44 AC (Y) YVR—YTO USD 1,918.00 1,656.06 + USD 2.50 = 1,658.56 YVR Stopover Charge 5.00 Total Charge USD 1,923.00 1,918.00 + 5.00 = USD 1,923.00

Example 2: On-Line Stopover Charge Routing: MIA—DL (Y)—ATL (No Stopover)—DL (Y)—LAS (Stopover)—DL (Y)—SFO Fare Constructs

STOPOVER DIVISION OF FARE LADDER PRORATES CHARGE TOTAL PRORATE

DL (Y) MIA—ATL 370.49 370.49 DL (Y) ATL—LAS 726.32 + 2.32 = 728.64 DL (Y) LAS—SFO USD 1,445.58 348.77 + 2.31 = 351.08 LAS Stopover Charge 4.63 Total Charge USD 1,450.21 USD 1,445.58 + 4.63 = USD 1,450.21


50 7/1/05

Example 3: On-Line Stopover Charge Routing: MIA—DL (Y)—ATL—DL (Y)—LAS—DL (Y)—SFO (Stopover Charge USD 4.63) The stopover charge appears at the end of the Fare Calc and no “Os” appear within the Good for Passage. This example will result in the stopover charge being divided equally across all coupons. FARE CONSTRUCTS

STOPOVER DIVISION OF FARE LADDER PRORATES CHARGE TOTAL PRORATE

DL (Y) MIA—ATL 370.49 + 1.55 = 372.04 DL (Y) ATL—LAS 726.32 + 1.54 = 727.86 DL (Y) LAS—SFO USD 1,445.58 348.77 + 1.54 = 350.31 Stopover Charge 4.63 Total Charge USD 1,450.21 1,445.58 + 4.63 = 1,450.21

Example 4: International Interline Journey with Multiple Domestic Segments Routing: ANC—UA—SEA—UA—LAX—NW—MSP—NW—TYO—UA—LAX— SEA—UA—ANC 1S50.00

NUC 2198.56

FARE CONSTRUCTS STOPOVER DIVISION OF FARE LADDER PRORATES CHARGE TOTAL PRORATE

UA (Y) ANC—SEA 74.49 + 16.68 91.17 UA (Y) SEA—LAX USD 135.28 60.77 60.77 NW(Y) LAX—MSP 253.61 + 16.66 270.27 NW(Y) MSP—TYO USD 939.00 685.39 685.39 UA(Y) TYO—LAX USD 939.00 939.00 939.00 UA (Y) LAX—SEA 60.77 60.77 UA(Y) SEA—ANC USD 135.28 74.51 + 16.66 81.17 Stopover Charge 50.00 Total Charge USD 2198.56 2148.54 + 50.00 2198.54


51 7/15/06

RULE 30—PRORATION OF SPECIAL SERVICE COUPON(S)

Refer to ACH Manual of Procedures, Passenger Section C.3, paragraph 4., Special Service Coupon/Tickets—Original Billings

A. One Coupon Tickets—Bill amount collected (excluding tax). B. Multiple Coupon Tickets—The total fare collected (excluding tax) will be divided based upon the Straight-Rate

Prorate formula (Rule 11), using each ticketed airline's highest local fare as a prorate factor for each coupon. NOTE: When a Special Service Ticket covers only excess baggage and/or kennel charges, such charges will be settled in accordance with Rule 28.

Documents

AIRLINE TARIFF PUBLISHING COMPANY PASSENGER PRORATE … Guides... · AIRLINE TARIFF PUBLISHING COMPANY PASSENGER PRORATE RULES MANUAL ... airline for code share.) ... ATPCO Fare Types/Fare