European Commission Pushes 16 Airlines On Refunds

The European Commission has secured commitments from several of the continent’s leading airlines that will see passengers receive refunds more promptly in the future. The news comes after an investigation by the commission into the 16 most-mentioned European airlines when it came to consumer complaints. Let’s take a closer look at the deal.

British Airways and TAP Portugal are two of the 16 airlines that the European Commission investigated. Photo: Getty Images

New reimbursement commitments

The European Commission announced in a statement earlier this week that it has received commitments from 16 airlines regarding passenger refunds. This is the culmination of a joint investigation into consumer rights that began in February 2021. Consumer authorities from Belgium, Germany, Greece, Italy, Spain, and Sweden led the research.

The process has resulted in a series of commitments from the airlines in question, including confirmation that most backlogs have been cleared. This means that airlines will be able to refund passengers within seven days going forward, in line with EU requirements. Airlines have also committed to better communication regarding flight cancelations.

The European has also pushed for greater transparency regarding the options that passengers have in the event of a cancelation. As such, the airlines it investigated will now give equal prominence to all passenger choices in their communications. These include re-routing, cash refunds, and refunds in the form of future travel vouchers.

The commission, which manages EU laws, began its work on the matter in February. Photo: Getty Images

A history-making move

The European Commission has also asked carriers to give greater clarity on the difference between bookings canceled by the airline and by the passenger. It also wants vouchers to be something that passengers choose, rather than the default option. This is because having them as the default often sees them go unused, particularly in such uncertain times.

The investigation turned out to be a history-maker for the European Commission. Specifically, it was the largest action in the history of its Consumer Protection Cooperation (CPC) network. In the future, it hopes that punctual and transparent refund policies will aid aviation’s recovery. Adina Vălean, the group’s Commissioner for Transport, stated that:

“I welcome the fact that the bulk of the reimbursement backlog has been cleared and that all airlines concerned have committed to solving the remaining issues. This is crucial to restoring passengers’ confidence. The recovery of the air transport sector depends on this.”

Lufthansa, another of the investigated airlines, was processing 1,800 refunds a week in September 2020. Photo: Vincenzo Pace | Simple Flying

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An expensive business

It goes without saying that paying out refunds can cost airlines a lot of money. However, since the start of the ongoing coronavirus pandemic, this has become a particularly costly area, with carriers having to deal with widespread cancelations due to restrictions and low demand. Emirates had issued $1.4 billion of refunds by September 2020.

This also created a significant backlog of administrative work for many airlines worldwide. For example, September 2020 also saw Lufthansa process an average of 1,800 refunds a week. Over in Canada, WestJet was only able to begin processing refunds in October 2020, during which time a 6-9 month backlog had built up. More recently, the country’s government granted Sunwing Airlines an $81.3 million loan to help deal with its backlog.

What do you make of this development? How have you found the process of being reimbursed during the pandemic? Let us know your thoughts and experiences in the comments.

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