Qantas should pay $250m fine, says ACCC boss Gina Cass-Gottlieb
Australia’s competition watchdog is demanding Qantas face a record fine for allegedly selling tickets on 8000 cancelled flights. See if you’re affected.
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Australia’s competition watchdog is demanding Qantas face a $250 million fine if they lose their court case after they allegedly sold tickets for 8000 cancelled flights.
The Australian Competition and Consumer Commission [ACCC] alleges Qantas engaged in false, misleading or deceptive conduct, by advertising tickets for more than 8000 flights that it had already cancelled but not removed from sale.
The ACCC alleged for the flights scheduled to depart between May and July 2022, Qantas kept selling tickets on its website for an average of more than two weeks - and in some cases for up to 47 days, after the cancellation of the flights.
ACCC chair Gina Cass-Gottlieb said the “ghost flights” that were cancelled over a period of three months in 2022 are being considered a breach of consumer law.
Speaking on Radio National on Friday morning, Ms Cass-Gottlieb said the national carrier should receive more than double the current $125 million record penalty a company has received for breaching consumer law.
“The highest penalty to date against a breach of the Australian consumer law was $125 million against Volkswagen,” Ms Cass-Gottlieb said.
“We consider that this should be a record penalty for that conduct.”
She said that the high penalty would be a clear way “to deter conduct of this nature” and scare companies that would consider doing the same.
When asked if companies were scared enough, she replied with “not sufficiently”.
“This is going to be an important test for us. We consider these penalties have been too low,”
“We think the penalties should be in hundreds of millions, not tens of millions, for breaches of consumers being inaccurately informed,” Ms Cass-Gottlieb said.
“We are going to seek penalties that will underline that this is not just to be a cost of doing business.”
Airlines can cancel flights in the short term for to a range of unforeseeable reasons including bad weather, aircraft defects and delays from previous flights
Flight cancellation can also happen due to a range of factors that are within the control of an airline.
“We allege that Qantas made many of these cancellations for reasons that were within its control, such as network optimisation including in response to shifts in consumer demand, route withdrawals or retention of take-off and landing slots at certain airports,” Ms Cass-Gottlieb said.
“However, this case does not involve any alleged breach in relation to the actual cancellation of flights, but rather relates to Qantas’ conduct after it had cancelled the flights,” she said.
A Qantas statement said: “We have a longstanding approach to managing cancellations for flights, with a focus on providing customers with rebooking options or refunds.
“It’s a process that is consistent with common practice at many other airlines.”
It comes as Qantas has removed the expiry deadline on Covid travel credits after CEO Alan Joyce admitted passengers had “lost faith” in the airline.
The backflip came days after the company said flight credits would expire on December 31.
The flight credit change means people who have travel credits with Qantas can request a cash refund indefinitely and those with Jetstar credits can use their credits for flights indefinitely.
The move means passengers have more time to redeem the money on flights or seek a refund - with more than $500 million owed between Qantas and Jetstar.
Due to system limitations, Qantas said Covid credits can’t be converted into a travel booking after December 31, but can be taken as a refund at any time after.
Mr Joyce said “the credit system was not as smooth as it should have been”.
“We’re doing this because we’ve listened,” he said in a video message to Qantas customers.
“While we’ve improved it recently, and extended the expiry date several times, people lost faith in the process. We hope this helps change that.”
The airline is offering double the standard number of Frequent Flyer Points for any flights booked with a Qantas Covid credit from September 4 to December 31.
Mr Joyce said Qantas now had one of the most flexible approaches that any airline has taken to its Covid credits.
“And it comes on top of the huge amount of work happening to improve how we serve you, every day. We’ll keep reaching out directly to everyone with a Covid voucher or credit with information on how to redeem,” he said.
HOW DO I KNOW WHAT I’M OWED?
Go to the Find My Credit tab on the Qantas website and use your original flight details - if you still have them.
By using the original flight booking reference - which can be up to three years old -you can check to see what credits you are entitled to. Passengers who made bookings through travel agents can check using their ticket number and travel agent details.
Qantas said if the ticket number you entered in the Find My Credit tool has been reissued, as many were as lockdowns rolled on, The Find My Credit tool should provide the latest ticket number available for use even if it has been reissued several times.
WHAT IF I STILL CAN’T FIND IT?
If you have deleted your email that has the booking reference then you will need to call Qantas or Jetstar or your travel agent.
HOW DO I CLAIM THE REFUND?
About 80 per cent of Qantas flights can be claimed as a refund.
If you booked directly with the airline, contact the airline to request the refund. If you booked through a travel agent, speak to them in the first instance.
Qantas claims it has “streamlined” the process to reduce the time passengers need to spend on the phone.
“This includes automating a number of systems to reduce the amount of time taken by our call centre operators in processing refund requests and reducing the amount of paperwork required to access a refund if a customer’s details have changed,” a Qantas statement said.
“If customers have made a booking directly through Qantas, they can call us on Call 1300 668 885 to request a refund.”
Alternatively, speak to the Travel Credit Concierge team on 1300 171 505.
HOW DO I USE THE FLIGHT CREDIT?
You should be able to rebook online by using the Find My Credit tool. Once you have found your credit, select ‘send email’ and Qantas will email you the details you need to book a new flight using the voucher details in the email.
WHY CAN’T THE MONEY JUST BE PAID BACK?
Markus Svensson, Qantas Group Chief Customer Officer, said it can’t happen automatically as many credit cards used to purchase the flights had expired.
“The majority of the Covid credits we hold can be converted into refunds but we can’t do it automatically as the credit cards used for the purchase as far back as 2019 may have expired,” he said.
“We’d obviously like customers to use their Covid credit to fly with us, but if they’d prefer a refund, we’re putting additional processes in place to help with that.”
WHY AM I NOT ELIGIBLE FOR A REFUND?
The 20 per cent that is no refundable has to be used for flights - this is due to a number of factors, including the passengers cancelling flights, possibly due to flight uncertainty during the pandemic.
Another portion of the 20 per cent not refundable have used part of the credit already.
WHEN DO THE FLIGHT CREDITS NEED TO BE USED BY?
Qantas has confirmed the deadline of December 31, 2023 as the final day when domestic and international Qantas and Jetstar flights can be booked using Qantas travel credit.
WHEN DO THE FLIGHTS HAVE TO BE ACTUALLY TAKEN?
The flights can be used anytime from now until December 31, 2024.
WHAT ARE THE VIRGIN AUSTRALIA CREDITS?
There are three types of credits.
Future Flight credits are credits issued as part of Virgin Australia’s voluntary administration process, in relation to bookings made on or before 20 April 2020. They are unable to be refunded.
Standard credits - which are any travel credits issued for bookings made from 21 April 2020 onwards. Some flights can be refunded, for example if Virgin cancels a flight.
“Covid” credits -These are a portion of Standard credits that were issued between September 2020 and 31 July 2022, in connection with bookings made from 21 April 2020 onwards.
HOW MANY COVID CREDITS ARE THERE?
There are now about $100 million remaining Covid credits.
Because “COVID” credits are a portion of Standard credits, “COVID” credits can be used in the same way as Standard credits and, are subject to the Standard credits policy.
WHAT ARE THE STANDARD CONDITIONS?
These are valid for 12 months from the date of issue. Standard credits are issued when a guest chooses to cancel their booking and is able to receive a travel credit (in accordance with the fare rules of their fare) or, for flights cancelled by Virgin Australia, in accordance with Virgin Australia’s Guest Compensation Policy.
WHEN DO COVID CREDITS NEED TO BE USED BY?
December 31, 2023.
HOW DO CLAIM MY VIRGIN TRAVEL CREDIT?
To do this you need to go to the Virgin Australia website and create a Travel Bank account.
Balances and expiry dates for credits can be accessed via a credit holder’s Travel Bank.
HOW TO FIND YOUR TRAVEL CREDIT DETAILS
Once you have created a Travel Bank account, an email containing your travel bank username is sent to the email address used for the original booking. If you are unable to locate your travel bank details, call the Virgina Australia Guest Contact Centre on 13 67 89 for help.
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