AR Inter Airline Settlement - IATA Procedures

Airlines belonging to IATA have to maintain IATA standards in order to meet their obligations in accordance with the Clearing House regulations. The Clearing House facilitates the settlement of transactions between members. Inter-Airline transactions regarding revenue billing for Passenger, Cargo, Universal Air Travel Plan (UATP) and Miscellaneous Charges are cleared through the Clearing House. After claims by and against each airline have been offset, settlement is effected monthly by an automatic net payment by IATA from or to each member.

IATA calculates and distributes its own currency rates to the member airlines. Different rates apply to different business categories:

Passenger
UATP
Cargo
Miscellaneous

Claims must be made on official IATA documentation, known as a Form 1. A summary of invoices by airline and category is presented on a Form 2. Totals, page by page from the Form 2, are presented on a Summary Form 2 report. The Clearing House sends payment details on a Form 3 together with copies of the other airlines' Form 1s. The payment dispatched will be for the claims made by the airline less any claims made on itself by the other airlines.

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