Airlines Reporting Corporation

What is the Airlines Reporting Corporation?

Airlines Reporting Corporation (ARC) is a privately held company headquartered in Arlington, Virginia, that provides ticket transaction settlement services, travel agency accreditation, and data analytics for the U.S. travel industry. Founded on September 17, 1984, as a successor to the Air Traffic Conference of America, ARC became fully operational on January 1, 1985, following airline deregulation in the United States [1].

ARC sits between airlines and the agencies that sell their tickets. When a travel agent issues an electronic ticket, ARC's settlement system collects payment data, calculates what each agency owes each airline, and transfers funds on a weekly schedule. This eliminates the need for individual billing relationships between every agency-airline pair.

Seven major airlines own ARC. The corporation is not a regulatory body or government agency. It operates as a shared-services company whose existence simplifies a logistical problem: how thousands of agencies remit billions of dollars in ticket revenue to hundreds of carriers without each party maintaining separate accounting relationships.

How ARC Accreditation Works

ARC accreditation is the gateway for any U.S.-based travel agency that wants to independently issue airline tickets. Without it, an agency cannot access airline inventory through a global distribution system for ticketing purposes.

The accreditation process involves several requirements [2]:

• Application fee: A non-refundable $2,300 payment
• Financial guaranty: A surety bond, letter of credit, or cash deposit of at least $20,000 (higher for agencies with parent companies outside the U.S.)
• Personnel: A designated agency manager and a designated ARC Specialist, who must pass an ARC-administered exam before accreditation is granted
• Background checks: ARC reviews all owners, officers, and designated managers
• Location: The agency must be located in and authorized to do business in the United States, U.S. Virgin Islands, Puerto Rico, or American Samoa

Once approved, ARC assigns the agency an ARC number used for ticket stock, reporting, and settlement. Airlines are notified of the new agency, and some may require a secondary "Specific Appointment" before the agency can issue their tickets.

Ongoing compliance requires semi-annual security training, annual electronic confirmation of eligibility, and adherence to the Agent Reporting Agreement (ARA), which governs reporting timelines, payment cycles, and fraud prevention obligations [3].

What Does ARC Do Beyond Accreditation?

ARC's three core functions serve different segments of the travel industry:

Financial settlement. ARC operates the Area Settlement Plan, which processes weekly payment flows between agencies and airlines. Rather than each of the 10,000+ agencies sending separate payments to each of 241 airlines, ARC nets the transactions and settles in bulk. This reduces administrative overhead and credit risk for both parties.

Data and analytics. ARC aggregates transaction-level ticketing data from across its network. Airlines use this data for route performance analysis, fare optimization, and competitive benchmarking. Corporate travel departments use ARC data to validate agency reporting and identify spending patterns across carriers.

Credit management and fraud prevention. ARC monitors agency sales patterns in real time, flags anomalies, and can suspend ticketing authority if it detects potential fraud or financial instability. The system uses reserve accounts and credit limits calibrated to each agency's sales volume and financial health.

ARC vs. IATA: What is the Difference?

A common point of confusion is the relationship between ARC and IATA (International Air Transport Association). The distinction is geographic scope:

ARC handles accreditation and settlement exclusively within the United States. IATA's Billing and Settlement Plan (BSP) performs a similar role internationally. A U.S. travel agency that wants to issue international tickets still uses ARC for the settlement mechanics, but the agency may also hold IATAN accreditation (administered by the International Airlines Travel Agent Network, a subsidiary of IATA) for recognition in international markets.

The ARC number and IATAN number are the same for agencies that hold both credentials, simplifying identification across systems.

Why ARC Matters for Corporate Travel Programs

For companies managing business travel, ARC operates mostly in the background. But its infrastructure directly affects three things corporate travel managers care about:

Ticket data accuracy. Every passenger name record processed through ARC carries structured data on fares, taxes, and fees. This feeds into expense systems and helps finance teams reconcile travel spend against policy. Navan pulls from ARC-processed booking data to give corporate clients real-time visibility into air spend across all booked carriers.

Agency legitimacy. ARC accreditation signals that a travel management company meets minimum financial and operational standards. When evaluating corporate travel agencies, verifying ARC accreditation is a baseline due-diligence step.

Refund and credit tracking. When flights are canceled or changed, ARC's settlement system handles the financial reversal. For non-refundable tickets, credits flow through the same ARC infrastructure, making accurate credit tracking essential for recovering unused ticket value.

The Role of NDC and ARC's Evolving Model

New Distribution Capability (NDC) is changing how airlines distribute content and fares. Unlike the traditional GDS-to-ARC pipeline, NDC allows airlines to sell directly to agencies and platforms through API connections that bypass legacy systems.

ARC has adapted by expanding its settlement services to include NDC transactions. In 2026, ARC is expanding reporting for ancillary fees and low-cost carrier settlement models, recognizing that more bookings now include unbundled components (seat selection, baggage, Wi-Fi) that the traditional settlement model wasn't designed to handle.

For agencies and corporate travel platforms, this means ARC remains relevant as a settlement backbone even as distribution shifts away from GDS-only models.

Sources

[1] Wikipedia, "Airlines Reporting Corporation," 2025. https://en.wikipedia.org/wiki/Airlines_Reporting_Corporation

[2] ARC, "Become an ARC-Accredited Travel Agency," 2026. https://www2.arccorp.com/globalassets/products--participation/travel-agencies/become-an-arc-agent/Accreditation-Datasheet_2020.pdf

[3] ARC, "Agent Reporting Agreement (ARA)," January 6, 2026. https://www2.arccorp.com/globalassets/ara-ctdra/ara.pdf

Related Terms

• Travel and Expense (T&E): The combined category of corporate spending on business travel and employee expenses, where ARC-processed ticket data feeds directly into reconciliation workflows.
• Corporate Card: A company-issued payment card used by employees for business purchases, including airline tickets that settle through ARC's financial infrastructure.
• Low-Cost Carrier: Airlines operating with unbundled fare models whose ancillary fee reporting is part of ARC's expanded 2026 settlement capabilities.
• Travel Booking: The process of reserving flights, hotels, and ground transportation, where ARC accreditation determines which agencies can issue tickets directly.