Airlines operating in the UK have not been fined or had any financial penalty imposed on them for breaching consumer rights laws on airline cancellations, delays and refunds in the past 17 years.
Despite being the regulator responsible for enforcing these rules the Civil Aviation Authority has no powers to fine airlines. Instead, when an airline repeatedly breaks the law, the CAA can use its regulatory powers to apply to the courts for an enforcement order to force the airline to comply. If the airline continues to refuse, the court process can potentially end in an airline paying a fine for being in contempt of court.
However, since the Civil Aviation Authority gained these powers in 2003, Which? understands it has only applied to the courts once for an enforcement order.
That application was made against Ryanair in 2018 for refusing to compensate passengers for delays caused by planned industrial action by its staff. The case has yet to be heard by the courts.
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Airlines break the law over refunds
This new Which? research comes against the background of some major airlines continuing to openly break the law over passenger refunds. Back in April, Which? found 10 of the biggest airlines in the UK had systematically broken the law over refunds for millions of cancelled flights caused by the coronavirus outbreak. EU and UK airlines are required by EU law to refund passengers within seven days when the carrier cancels the flight, but some passengers have waited for months.
In July, the Civil Aviation Authority said it had reviewed the practices of airline refunds in recent months, including 12,000 passenger complaints submitted by Which?. It confirmed it had found widespread law-breaking, but would not take enforcement action against any airline. Instead, it said a number of airlines had provided commitments to improve communication around consumer rights and the speed of refunds. Which? found that some of the these commitments had immediately been broken.
This is not the first time airlines have broken the law and got away with it.
Passengers forced to turn to the bailiffs
In 2004, the EU introduced stronger legislation on airline cancellations, refunds and delays known as EC261. This legislation is designed to ensure passengers aren’t left out of pocket because an airline causes them to miss some or all of their holiday or trip, and to encourage carriers to run a punctual service. Yet some airlines frequently bend or break these rules.
Which? has repeatedly reported on airlines refusing to reroute passengers when flights have been cancelled, or provide food, drink and overnight accommodation for stranded customers despite carriers knowing that EU law requires them to do both.
Passengers also regularly face a fight to claim compensation for delayed flights. If you’re flying with an EU or UK airline, or from an EU or UK airport and your flight is delayed by more than three hours you could be due between €250 and €600, depending on the length of the delay and distance of the flight. But some airlines have been disputing and delaying many of these payments for years.
Tens of thousands of passengers are regularly forced to resort to the CAA’s dispute resolution schemes to try and get their money. These schemes should only be for complicated cases where there is dispute over the law, or the passenger has made an incorrect claim, but every year airlines lose the majority of cases. When they do, some still ignore the ruling and refuse to pay up.
As a result passengers turn to claims-management firms to fight for their money, thereby surrendering up to 40% of their compensation, or the courts. Thousands of cases end up in court every year. Yet even when airlines lose in court many refuse or delay payments and passengers end up calling in the bailiffs. Which? spoke to a bailiff earlier this year who said it issued hundreds of writs against airlines in the past year.
So with airlines so obviously breaking the rules, why doesn’t the CAA take action?
What the CAA can do (and what it can’t)
The simple answer is that the CAA lacks the right powers to enforce the law.
It mostly relies on ‘undertakings’ from airlines to stop them breaking consumer rights law. These undertakings have proved useful.
In 2017, the CAA intervened to secure undertakings from American Airlines, Emirates, Etihad, Singapore Airlines and Turkish Airlines, after those airlines refused passengers compensation for delays caused by missed connections outside the EU. All five are now complying with EU law on missed connection delays.
But these undertakings are only practical if the carrier is willing to agree to them, and for the most part only help to improve future behaviour rather than applying any retrospective penalty. The CAA has also only managed to agree 13 with airlines in relation to breaches of EC261 since 2006.
If the airline refuses to agree to an undertaking the CAA must take them to court, even if it has assessed that they are in breach of the regulations it is supposed to enforce. Unlike some other regulators the CAA itself can’t fine an airline directly. In 2019, the Financial Conduct Authority, which regulates financial services, issued a total of £392 million in fines.
Court action can take years. The CAA applied to the courts for an enforcement order against Ryanair in 2018. The case may not be heard until 2022. Ryanair is not required to amend its behaviour until the case is settled, nor will it necessarily face a fine when it is
The government needs to act to protect consumers
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.’
We are asking customers to sign our Refund Us. Reform Travel campaign petition to put further pressure on the government over the behaviour of airlines.