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ACCC Goes After Aussie Airlines

The Australian consumer watchdog has stated that the refund policies of certain Aussie airlines did not comply with Australian Consumer Law and has begun Federal court proceedings against Jetstar over its practices.

Jetstar, Tigerair, Qantas and Virgin Australia each made false or misleading representations on their respective websites that potentially misled customers regarding their rights to refunds and replacement flights in the case of a flight delay or cancellation.

Under Australian Consumer Law (ACL), services such as flights come with automatic consumer guarantees, and “these rights cannot be excluded, restricted or modified”.

Meaning that if a flight is significantly delayed or cancelled, and the delay is within the airline’s control, customers may be entitled to a refund or a remedy such as a replacement flight “within a reasonable time-frame.”

Tigerair only provided a refund to customers if they paid a “refund admin fee” and in return, the customer would only receive credit that was valid for six months.

Qantas admitted it may have misled consumers into believing refunds were not available for its ‘Red e-deal’ fares and that its flights were not subject to any statutory guarantees.

Similarly, Virgin Australia admitted it too may have led customers to believe that refunds were not available for its ‘Domestic Getaway’ and ‘International Short-Haul’ fares and only provided refunded customers with credit that was valid only for 12 months.

Jetstar admitted that it stated on its website that certain fares were not refundable, and consumers would only be entitled to a refund if they purchased a more expensive fare.

Additionally, Jetstar’s terms and conditions stated that consumer guarantees under the ACL did not apply to its flight services and that Jetstar had limited liability in providing solutions to consumers.

As a result of their policies, the ACCC has also begun court proceedings against Jetstar. 

“Airlines cannot make blanket statements that flights are non-refundable or charge consumers a fee to get a refund when they are entitled to one free of charge under the ACL.” ACCC Chair Mr Sims said.

In response to the ACCC, each airline has committed to reviewing and updating their refund policies and compliance programs.

Jetstar, Qantas and Virgin Australia have also stated that they will review consumer complaints made during a specified time period, and offer solutions or refunds to any affected consumers.

All four airlines will also create an ACL information page on their websites that will state passengers’ consumer guarantee rights and the steps they can take in the event of a delayed or cancelled flight to seek a remedy.

More information can be found here.

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