CMA closes probe into airline covid-19 refunds due to 'lack of clarity in the law'

The Competition and Markets Authority (CMA) has closed its investigation into whether British Airways and Ryanair broke the law when they failed to offer refunds to customers who were unable to legally take flights during lockdown due to a “lack of clarity in the law”.

British Airways customers were given the option of credit vouchers or a fee-free right to rebook, while Ryanair customers had a fee-free right to rebook. Ryanair told the CMA it had also offered refunds to a small number of customers “having reviewed the specifics of their cases.”

The CMA launched its probe in June, but after an examination of relevant law and evidence gathered during its investigation, has concluded the law does not provide passengers with a sufficiently clear right to a refund to justify the CMA continuing with the case given the uncertainty of the outcome and the length of time it would take to reach an outcome in the courts.

The CMA is only able to enforce the law as it stands and while it believes customers should have been offered a refund, consumer protection law only entitles passengers to a refund when an airline cancels a flight because the airline is unable to provide its contracted services – it does not clearly cover the scenario where the flight goes ahead, but passengers are legally prohibited from travelling.

Andrea Coscelli, chief executive of the CMA, said: “We strongly believe people who are legally prevented from taking flights due to lockdown laws should be offered a full refund and we launched this investigation in the hope that we would be able to secure a positive outcome for consumers.

“However, after considering the relevant law and gathering evidence in our investigation, we have concluded that the length of time that would be required to take this case through the courts, and the uncertain outcome, can no longer justify the further expense of public money”.

Coscelli said he hoped the law will be “clarified”.

The CMA has previously secured millions of pounds’ worth of refunds for customers whose package holidays were cancelled due to the pandemic, including LoveHolidays, Lastminute.com, Virgin Holidays, TUI UK, Sykes Cottages and Vacation Rentals.

However, it said this case is different as there are no separate laws that govern flights, unlike in respect of package holidays where the Package Travel Regulations apply, which clearly gave consumers refund rights which the CMA were able to enforce.