The International Air Transport Association (IATA) is the global trade association for the world’s airlines, representing about 300 airlines that account for 83% of total air traffic. Far more than a lobbying group, IATA is the operational engine of the aviation industry, with responsibility for formulating industry policy, setting technical standards (such as baggage rules and ticketing formats) and managing the massive financial settlement systems that permit money to flow from one travel agency to another airline.
To the travel technology sector, standardization is IATA’s most visible contribution. Without IATA the global reservation network would not have a common language.
IATA’s most important operational function is that of the industry’s central bank under the Billing and Settlement Plan (BSP).
In a world without BSP, to sell tickets to various airlines, a travel agency would have to write separate checks to each airline they sold a ticket for (one for United, one for Emirates, one for Qantas). Instead, the BSP acts as a consolidator:
People tend to confuse IATA and ICAO, but both of their mandates are absolutely different.
It is a special 7-digit numeric code assigned to IATA-accredited travel agencies. This is used as a badge of verification so that the agency issues airline tickets and receives commissions. Without it, an agency normally can’t sell flights directly.
ONE Order is an IATA project to modernize airline accounting. It aims to replace the many hard coded records that are now used (PNR, E-Ticket, EMD) with one flexible retail order record, comparable to an Amazon shopping cart receipt.
No. IATA used to hold price-setting conferences decades ago but this practice was banned on account of anti-trust laws. Today, the airlines decide their own prices depending on market competition.
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