Airlines operating in the UK have not faced a single fine for breaking consumer law on refunds, delays or cancellations since 2003, Which? can reveal.
In the same time, the Civil Aviation Authority (CAA) has only used its powers to apply to the courts for an enforcement order – a court order effectively ordering an airline to comply with the law – once.
The regulator was granted the relevant regulatory powers to seek enforcement orders and gain undertakings from airlines in 2003, but despite having responsibility for enforcing consumer rights laws on airline cancellations, delays and refunds, the CAA cannot directly fine airlines.
Which? is now calling for the aviation regulator to urgently be given powers to fine airlines, after nearly six months of blatant disregard of the law on refunds for cancelled flights during the pandemic.
Which? understands that only one application for an enforcement order has been made by the regulator since 2003. This was against Ryanair in 2018, for refusing to compensate passengers for delays caused by planned industrial action by its staff during the peak of the summer holidays. Two years on, the case has yet to be heard and may not be heard until 2022, and during this time the airline can continue to refuse to compensate consumers without penalty.
These findings come after Which? exposed the UK’s 10 biggest airlines for repeatedly breaking the law on refunds for coronavirus cancellations earlier this year, and after the CAA stopped short of applying for any enforcement orders against any UK airlines in July for their handling of cancellations and refunds as a result of the pandemic, despite receiving tens of thousands of complaints through Which? and from passengers directly.
A number of airlines, singled out for their poor handling of refunds, told the regulator they would commit to improving their processes and refunding their customers. However, Which? continued to hear from a number of passengers of those airlines who were still waiting for refunds, despite the airlines’ commitments.
Additionally, at the beginning of the pandemic, the consumer champion reported airlines to the regulator for refusing to reroute passengers when flights have been cancelled, leaving passengers stranded abroad and having to pay extortionate fees to get home.
Airlines have been breaking consumer law for many years before the coronavirus pandemic too. Which? called out some of the UK’s biggest carriers last year for failing to provide food, drink and overnight accommodation for stranded customers, despite the fact that that EU law requires them to do both.
The CAA has previously said that its enforcement powers are not well suited to swift action, and that it can take a considerable period of time for a case to come before the courts.
Rather than going through the lengthy process of using these powers, the regulator has historically relied on ‘undertakings’ from airlines to stop them breaking consumer rights laws, which have previously proven useful.
However, these undertakings generally only help to improve future behaviour, rather than applying any penalty for historical breaches of the law. The CAA has managed to agree 13 undertakings since 2006 in relation to airline cancellations, refunds and delays since the EU introduced the EC 261 Regulation
The CAA cannot fine airlines directly for breaches of consumer law. In contrast, last year the Financial Conduct Authority, which regulates financial services, issued a total of £392 million in fines.
The consumer champion is concerned that after nearly two decades without any financial penalties for breaking the law on refunds, delays or cancellations, airlines now feel empowered to break the law without fear of sanctions, and that the limited action taken with regards to coronavirus refunds could have set a precedent that risks allowing airlines to continue to treat passengers unfairly.
As part of its campaign to secure refunds for passengers affected by coronavirus cancellations and to reform the travel industry to prevent a failure of passenger protections on this scale from happening again, Which? is calling for the regulator’s enforcement powers to be strengthened and extended.
This should include the ability to fine airlines, to enable the CAA to take swift and meaningful action against carriers that have repeatedly disregarded the law and their obligations to passengers.
Rory Boland, Editor of Which? Travel, said:
“Without the ability to issue fines or take swift action against airlines, the Civil Aviation Authority has struggled to effectively stand up for the passengers it is there to protect. Several airlines already know this, and there’s a real risk some have felt empowered to break the law as a result – and without the threat of penalties, they may continue to do so.
“Trust in the travel industry has been battered in recent months, so passengers need a strong regulator they can count on. It’s clear serious reforms need to be made to the sector – as a first step, the government must take urgent steps to ensure the CAA has the tools it needs to effectively hold airlines to account.”
Notes to editors:
- When an airline breaks the law, the regulator can apply to the courts for an enforcement order. If the airline continues to refuse, the court process can potentially end in an airline paying a fine for being in contempt of court.
- In 2017, the CAA intervened to secure undertakings from American Airlines, Emirates, Etihad, Singapore Airlines and Turkish Airlines, after they refused passengers compensation for delays caused by missed connections outside the EU. All five are now complying with EU law on missed connection delays.
- UK airlines abandon flyers during delays – 26th July 2019
- Coronavirus: airlines failing to reroute passengers – 3rd April 2020
- UK’s biggest travel operators and airlines openly breaking the law on refunds for cancelled holidays – 22nd April 2020
- Trust in the travel industry plummets to record low amid coronavirus refunds scandal – 20th May 2020
- More than eight in 10 Ryanair passengers still waiting for refunds – 28th May 2020
- Passengers facing emotional and financial ordeal chasing coronavirus refunds as carriers continue to break the law – 16th July 2020
- Airlines failing on commitments to regulator about time taken to process refunds – 12th August 2020