Last week, Qantas agreed to pay up to $125K in penalties after what the US Department of Transportation (DoT) ruled were violations of a foreign carrier flying in the US. Non US airlines are not allowed to carry passengers between two US cities (referred to as cabotage), unless that passenger is continuing onwards outside the country on that same carrier. I’ve taken multiple Qantas flights via AAdvantage award redemptions from JFK to LAX and then onwards to Sydney or Melbourne. However, the DoT took issue with the fact that in 2015 and 2016, Qantas allowed passengers who were connecting at LAX to their codeshare partner Air Tahiti Nui onwards to Tahiti as well as via American Airlines onwards to New Zealand to take the JFK-LAX flight.
Qantas maintains it did nothing wrong. It codeshares with American and Air Tahiti Nui, and in both cases, customers had bought Qantas flight numbers for all legs. Effectively, Qantas said, the passengers were flying Qantas for their entire itineraries. But the DOT ruled the codeshares were different. “By holding out flights and transporting revenue passengers between two points within the United States and then placing those passengers on flights operated by other carriers for onward transportation to foreign destinations, Qantas engaged in unauthorized cabotage,” it said in its decision.
Qantas will continue operating the JFK-LAX connection, but will switch from their current 747 to a 787-9 in September.