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EU court: Airlines must not charge cancellation fees

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The European Court of Justice (EJC) has ruled that airlines cannot levy additional charges if a consumer cancels a flight. German judges had asked the court to rule on airberlin’s refund policy and disclosure of additional taxes. (atwonline.com) Ещё...

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lemonfly
Lemon Chinyakov 3
Wow this is awesome even though there are not many AMERICAN airliners that charge them
treno
Alfred Guell 5
Please read the article more closely! It is not about the airline needing to refund every ticket fully. It is about that Air Berlin charged a cancellation fee for a cancellation, no matter if refundable ticket or not! This is not correct.

Also, what many people don't know, even if you cancel a non-refundable flight, by European law the airline has to refund all taxes and fees, only thing they don't need to refund is the flight fare. That is why the ticket price has to be split up on the website for the customer.

With todays ticket prices, if you buy a cheap fare 90% of the price can be the taxes and charges. So in case of cancellation you have the right to ask back for a big part of the paid amount, as the airline will not have to pay for that themselves. For example, I have a flight booked from Vienna to Hong Kong for 515,90 Euro. The stated fare is 55 Euro. So in case I cancel the flight, the airline would have to give me back 460,90 Euro and can only keep the 55 as compensation for me not flying.
jcsjcs
jcsjcs 4
>> For example, I have a flight booked from Vienna to Hong Kong for 515,90 Euro. The stated fare is 55 Euro. So in case I cancel the flight, the airline would have to give me back 460,90 Euro and can only keep the 55 as compensation for me not flying.

I'm sorry to disappoint you. Lufthansa has long been hiding the fuel "surcharge" (because fuel is currently more expensive than ever (this was sarcasm, in case it didn't become clear)) in the "Taxes and Fees" section. And a couple of years ago it realized that it did not have to refund the fuel surcharge hidden in there.

If there is one piece of legislation that I am really hoping for, it would be that "fuel surcharge" is to be abolished. The cost of fuel should be included in the fare. If the cost of fuel changes, just change the fare.

JCS.
jcsjcs
jcsjcs 4
>> Please read the article more closely! It is not about the airline needing to refund every ticket fully. It is about that Air Berlin charged a cancellation fee for a cancellation, no matter if refundable ticket or not! This is not correct.

Spot on: Let's say, Air Berlin sold a ticket for 500€ and stated that in the case of cancellation 350€ are refundable (150€ cancellation fee).

Then, when you actually did cancel, they said that in order to refund te 350€, you would have to pay a 25€ processing fee, which was hidden somewhere in the T&Cs. It's not really a surprise (in Germany/Europe at least) that this would be challenged by the the consumer protection agencies and that the courts would follow suit.

Had Air Berlin simply charged a 175€ cancellation fee, nobody would have batted an eye. Air Berlin didn't want to do this because they wanted to look better than their competition.

JCS.
Patster
Patrick Smith 2
Wow! Something positive coming from the Eurocrats? Whatever next?
linbb
linbb 1
Great now they are getting into an area which can cost them more money due to handling no shows or people canceling there tickets.

And they wonder why airlines over book.
TorstenHoff
Torsten Hoff 5
I'm torn on this.

I think the airlines should be compensated for the costs associated with cancellations.

On the other hand, their customers pay for the tickets in full before they fly, usually weeks or even months in advance. That's millions of dollars (or Euros in this case) that they put in the bank and earn interest on, or can otherwise invest.

I think this will ratchet up the price wars as travelers can take advantage of last-minute deals and rebook on a different airline.
Highflyer1950
Highflyer1950 7
I think you are correct. A lot of money is prepaid for travel. The non-refundable tickets should take care of any booking expenses ( if any, with on line booking) As for last minute cancellations on a full fare ticket, well that's the chance the airlines take in offering the same service at sometimes 3 times the price.
SWEATINTHSWAMP
SWEATINTHSWAMP 2
I booked on Travelocity five months ahead of trip on United. Who holds that money? United or Travelocity?
whip5209
Ken McIntyre 5
United. The flight is on their ticket stock.
30west
30west 3
The customers have a choice to purchase fully refundable tickets or, at a discounted price, the non-refundable tickets. If they want the fully refundable option it is available at a higher price.

The question is who assumes the financial risk of last minute cancellations, the airline for the lost revenue or the customer for forfeiting the fare by purchasing a cheaper ticket.

From the airlines' perspective, the fully refundable higher priced tickets cover the cost of lost revenue of the percentage of those tickets that generate last minute cancellations resulting in empty seats as the jetway is pulled away. And from the customers perspective, they have the choice to either pay for that monetary protection or assume the financial risk of changing their plans.

The government requiring that all tickets be fully refundable will result in a higher average price of tickets. It comes down to RASM and CASM, revenue per available seat mile minus cost per available seat mile determines whether an airline is profitable and ultimately remains in business.
wx1996
wx1996 5
Sorry disagree that we have a choice.

Customers have a technical/legal choice. But Logically they have no choice between refundable and non-refundable. When United charges me 580 for a nonrefundable ticket and for the same flight to be flexible/refundable they want $1087. You take the cheaper ticket and pay the $200 change fee. There is no choice for anyone who has a check book to balance when you get two tickets for the price one one for refundable vs nonrefundable. It is only a choice for business travelers who do not care about cost as the company is paying.

That said customers are getting what they deserve and are willing to pay for. When they will change airlines for less than a $5.00 difference in fare, pennies make a difference for the airline in pricing.

Their has to be some middle ground between not changeable/refundable and the screw the passenger fees used by most airlines.

Southwest does it well with changeable but not refundable. For extreme live events like the death of a family member they also refund. And their refundable fare is generally a logical option as they are about 30% more, not double. In my opinion, they have found some good middle ground. It seems to be working as they are making money and growing.

Insurance is the best option for now for the other airlines.
30west
30west 2
The change fees do mitigate the situation of not being able to use a non-refundable ticket. The UAL change fee example and the 30% change fee you mention for Southwest are very similar percentage-wise to the customer. I agree, Southwest does a good job at managing many aspects of their operation/customer interactions with employees and has a lot of dedicate customers.
ArthurNetteler
Arthur Netteler -2
Please read my Comment, before you think your comment is correct.
jcsjcs
jcsjcs 1
I think you're missing the point. There will still be refundable/non-refundable tickets. However, Air Berlin wanted to charge a 25€ processing fee for carrying out the refund, even on fully refundable ticket. See my other post for more details.

JCS.
ArthurNetteler
Arthur Netteler -3
I suggest you read my post before you think that YOUR COMMENT is Correct!
ArthurNetteler
Arthur Netteler -2
Here in the Philippines you can not even get a Cancellation or Refund when the Customer is under Doctors Care in the Hospital. Case in point: I was in the Philippine Heart Center for irregular Heart Beat and Arrhythmia Issues. With letter IN HAND from the Heart Surgeon, stating we needed to CANCEL a Manila to LAX flight (more than 90 days away) for an indefinite Period of Time. The carrier Philippine Airlines told us that Refund was OUT OF THE QUESTION, unless we would file a Request to the DOCTORS that the Airline has On Call for a SPECIAL Examination (at our own cost). But we could CANCEL the Reservations for a FEE! That FEE was equal to the Penny, of the total cost including TAXES of the Tickets. So you would have to pay all the Costs, Taxes and VAT on a Flight that you would not be going on! You can see that once you Book a flight in the Philippines your SCREWED if you need to make ANY CHANGE AT ALL. NOT GOING TO HAPPEN! One more thought... On my LAX Flight the Airline has now made 3 CHANGES to the Reservation! Even CANCELLING the actual FIGHT I WAS BOOKED ON, and BOOKING ME ON A DIFFERENT FLIGHT 12 HOURS LATER. And not even ASKING US if we could USE a Flight that was 12 hours LATER. That would have caused us to MISS the Connecting Alaskan Airline Flight we had booked as part of the ORIGINAL TRIP.. They still told us we could not get a REFUND of the Manila to LAX, and we should not have Booked the Connecting Flight until we were ACTUALLY IN LAX!

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