British Airways has reached an agreement with the US Department of Transportation (DOT) to compensate consumers for cancellation penalties and other expenses related to an erroneous fare offer.

The carrier incorrectly offered a $40 fare between the US and India on its website on 2 October, but removed it within minutes after realising the error.

However, DOT explains the fares remained on websites of certain on-line travel agents for roughly two hours.

During that time the agency says more than 1,200 bookings were made covering about 2,200 passengers.

DOT explains that British Airways cancelled the bookings of all the passengers that purchased the fares, and before its Enforcement Office began the review of the matter, offered all affected customers a $300 voucher.

In consultation with the agency's enforcement office, the carrier has also agreed to reimburse passengers for expenses stemming from the $40 fare. Expenses eligible for reimbursement are fees for cancelling flights and hotels, rental cars and additional costs incurred in rebooking flights due to fare increases on previously-held flights that were cancelled in order to book the mistaken fare.

"We are pleased to see that British Airways has accepted responsibility for the fares it published," says U.S. Transportation Secretary Ray LaHood.

Source: Air Transport Intelligence news