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Airlines’ failure to offer Covid cash refunds investigated by UK regulator

Competition and Markets Authority will consider whether there has been breach of consumer rights

A plane taking off at sunset.

The CMA says airlines may be under severe financial pressure but that does not mean consumers should be ‘left unfairly out of pocket’. Photograph: Steve Parsons/PA

The UK competition regulator has launched an investigation into the failure of airlines to offer cash refunds to travellers who have been unable to take their flights because of the coronavirus pandemic.

The Competition and Markets Authority (CMA) said its move followed reports that airlines may have breached consumers’ rights by not offering cash refunds in cases where travel restrictions meant people could not legally take the flight.

The CMA cited the example of consumers being unable to travel for non-essential purposes in the UK or abroad during the second lockdown in England in November. The regulator said it was aware of cases where flights were not cancelled and customers were not offered refunds even though they could not lawfully travel. Instead, many were offered the option to rebook or receive a voucher.

Last month, Michael O’Leary, the chief executive of Ryanair, said customers would not be offered refunds if their flight was operating but they could not travel. “There won’t be refunds on flights that are operating and travelling,” he said. “But we’ve waived the change fees for bookings.”

The CMA said airlines may be under severe financial pressure but that did not mean consumers should be “left unfairly out of pocket”.

Andrea Coscelli, the chief executive of the CMA, said: “We will be carefully analysing all the evidence to see whether any airlines breached consumers’ legal rights by refusing people cash refunds for flights they could not lawfully take. We recognise the continued pressure that businesses are currently facing but they have a responsibility to treat consumers fairly and abide by their legal obligations.”

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The CMA intends to write to a number of airlines to “understand more about their approaches to refunds for consumers prevented from flying by lockdown”. The regulator, which did not state which airlines it will be contacting, said that after a “careful analysis of this evidence” it would then decide whether to launch enforcement action against individual airlines.

The CMA will work with the UK’s Civil Aviation Authority, which leads on consumer protection in the airline sector, on the investigation.

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