Flight Centre will no longer impose fees for travel bookings cancelled due to the coronavirus, following pressure from customers and regulators.
Key points:Flight Centre will no longer charge customers $300 per person for cancellation feesThe ACCC welcomed the move, which followed weeks of pressure on the companyFlight Centre says the change to fees will be applied retrospectively
The travel agent had been charging cancellation fees of $300 per person for a refund of an international flight, or $50 for a domestic flight, even if the tour operator or airline included in the booking was also charging a fee.
The Australian Competition and Consumer Commission (ACCC) welcomed the move but said the decision followed weeks of pressure placed on the travel company to improve its treatment of customers during COVID-19 restrictions.
The decision to no longer apply the fee will be applied retrospectively to bookings cancelled due to COVID-19 on or after March 13, 2020.
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The ACCC said it would have taken court action if Flight Centre did not change its position, but the company’s move would provide faster relief.
In a letter sent to customers on Saturday night, Flight Centre executive general manager Allisa O’Connell said the decision to waive the fee was made following consultation with the ACCC.
“The decision to waive fees will impact our business, nevertheless we have heard your feedback and we believe this step is the right one for the current economic conditions where stand-downs and job losses are a daily occurrence for many Australians,” she said.
“Please note this waiver applies to our fees — we cannot waive fees or conditions that airlines and other third-party suppliers impose.”
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The cancellation fee had been capped at $600 per group for international travellers and $100 for domestic travellers, but Flight Centre was offering credit to customers.
The backdown follows public backlash against the fee from customers on social media.
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The ACCC has received more than 6,000 complaints from travel company customers about refund policies and cancellation fees.
The regulator said a consumer’s right to a refund during this period would depend on the terms and conditions of the contract entered into with the travel provider.
Ms O’Connell said Flight Centre staff would continue to contact travel suppliers on behalf of costumers and process refunds, but the process was time-consuming and delays were also contingent on individual suppliers.
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ACCC chair Rod Sims said customers should be patient as many businesses are struggling to process the high number of cancellations.
“We are continuing to discuss issues in relation to refunds and cancellations with the travel sector, and encourage travel providers to treat consumers fairly in these exceptional circumstances,” Mr Sims said in a statement
“While we know some consumers are very concerned about getting a refund or credit for their cancelled travel plans, we do ask people to be mindful of the significant impact that this pandemic has had on the travel industry.
“We ask consumers to remain patient and be mindful of the significant pressures on businesses at this time and, where possible, contact the business by email or website, rather than by phone.
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Ms O’Connell addressed concerns about Flight Centre’s health after it stood down thousands of workers in March.
“We announced [via the Australian Securities Exchange] on April 6 that we had taken very positive steps to strengthen our long-term liquidity position and were well placed financially to weather a prolonged downturn in demand resulting from restrictions on travel and trading,” she said.
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