EU Pushed to Guarantee Refunds for Travelers on Canceled Flights
EU Pushed to Guarantee Refunds for Travelers on Canceled Flights
(Bloomberg) --
European Union governments were pushed by a consumer group to guarantee refunds for travelers whose flights were canceled in the wake of the coronavirus pandemic.
The Netherlands and other countries are allowing airlines to postpone refund claims or issue vouchers instead, European consumer organization BEUC said in a letter to EU officials.
A fund backed by the EU or national governments to cover reimbursement claims “would be the most practical, most sustainable and most beneficial for both, industry and consumers,” BEUC said. Typically, passengers are entitled to refunds if flights are canceled.
Thousands of flights have been scratched in Europe since governments imposed travel bans to halt the spread of the virus. While many airlines are paying customers back, some aren’t. Airlines will burn through as much as $61 billion worldwide in the second quarter, the International Air Transport Association says, with revenue set to plummet by 68%.
EU Competition Commissioner Margrethe Vestager earlier today approved a fund set up by Denmark that grants a 200 million euro ($216 million) government loan to reimburse travelers.
BEUC says travel issues account for up to two-thirds of all consumer complaints it has received in recent weeks. Passengers’ trust in the travel industry is eroding as rights are ignored.
“If consumers are to start booking travel again in the near future to help the industry recover, they need to know” that “they are protected and will get their money back in case of cancellation,” it said in the letter. Consumer groups will urge people to accept vouchers as long as the vouchers are valid for two years and guaranteed by the government if the airline goes out of business.
EU Consumer Affairs Commissioner Didier Reynders said regulators are “trying to advise consumers to accept a voucher rather than compensation” because tour operators, travel agents and airlines risk collapse, he told Belgian news channel LN24 on Friday. He said the EU favored a guarantee for vouchers, without giving any details.
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