The Australian Competition and Consumer Commission (ACCC) has filed a court action against Qantas for breach of consumer law.
Here are the facts you need to know.
Qantas Accused of Advertising Cancelled Flights: ACCC Initiates Court Proceedings
On August 31, the Australian Competition and Consumer Commission (ACCC) initiated proceedings against Qantas Airways (QAN). The airline giant stands accused of misleading and deceptive conduct, specifically regarding advertising tickets for over 8,000 flights that had already been canceled.
Copy of Court Filing: ACCC vs. Qantas (Concise Statement)
Key Allegations:
- Misleading Advertising: Between May and July 2022, Qantas allegedly continued selling tickets on its website for more than two weeks post-flight cancellations. In certain instances, these tickets remained on sale for up to 47 days following the cancellation.
- Delay in Information: Qantas is also under scrutiny for purportedly failing to inform existing ticket holders about canceling over 10,000 flights within the same period. The average delay for this notification is around 18 days, extending to 48 days in extreme cases.
Impact on Travelers
As alleged by the ACCC, these discrepancies affected a significant chunk of Qantas’ canceled flights between May and July 2022. Approximately 70% of these flights either continued to have tickets sold post-cancellation, had delayed information for ticket holders, or both.
ACCC Chair Gina Cass-Gottlieb shed light on the situation, stating that the ACCC’s in-depth investigation revealed that Qantas’s practices likely disrupted the travel plans of tens of thousands of individuals. The fact that Australia is vast and air travel is essential for numerous reasons further escalates the significance of this issue.
Investigation Findings
The ACCC’s robust investigation, which involved interacting with impacted consumers and Qantas directly, found that the airline canceled nearly a quarter of its flights from May to July 2022. This translated to around 15,000 of the 66,000 domestic and international flights being canceled.
In its announcement, the consumer protection agency lists multiple examples of flights that illustrate this conduct by Qantas.
Background
Qantas, Australia’s leading domestic airline operator, offers flights through various channels, including its website, app, travel agents, and third-party online booking platforms.
Ongoing Concerns
ACCC’s dealings with Qantas have been extensive, especially during the pandemic and the subsequent recovery. The commission has continually engaged with Qantas regarding its customer service. The ACCC claims Qantas holds the distinction of receiving more consumer complaints than any other business. The ACCC reported over 1,300 complaints specifically related to Qantas cancellations in the last year alone.
COVID-19 Credits
Last week, Qantas announced removing the expiry date from its COVID credits, giving consumers options and incentives to use these credits on flights or obtain refunds. Before Qantas’s announcement, the ACCC had written the airline “strongly objecting” to the previous COVID credit expiration date of December 2023. Qantas also faces a consumer class action on these credits.
Penalties and Injunctions
The ACCC is pursuing penalties against Qantas. The maximum penalties for each breach of the Australian Consumer Law before 9 November 2022 is the greater sum of:
- $10 million or
- Three times the total benefits that have been obtained and are reasonably attributable or
- If the total value of the benefits cannot be determined, 10 percent of the corporation’s annual turnover.
Qantas Statement on Allegations
In response to the court action, Qantas published the following statement:
Qantas continues to review the allegations made by the ACCC and will have more to say once we’ve had that opportunity.
Understandably, these allegations have caused significant concern among our customers, our people and the general community. We want to address those allegations as best we can without cutting across the legal process we are now involved in, which follows an ACCC investigation with which we fully co-operated.
The period of time that the ACCC’s claims relate to, in mid-2022, was one of well-publicised upheaval and uncertainty across the aviation industry, as Qantas struggled to restart post-COVID. We openly acknowledge that our service standards fell well short and we sincerely apologise. We have worked hard to fix them since and that work continues.
Some commentary has suggested that Qantas was engaged in charging a ‘fee for no service’ due to cancelled flights over this period. Our longstanding practice is that when a flight is cancelled, customers are offered an alternative flight as close as possible to their original departure time, or a refund.
The ACCC’s allegations come at a time when Qantas’ reputation has already been hit hard on several fronts. We want the community to know that we hear and understand their disappointment. We know that the only way to fix it is by delivering consistently. We know it will take time to repair. And we are absolutely determined to do that.
To the 25,000 people who make up the Qantas Group, we say thank you. Every day, you are focused on carrying customers safely to their destination and your professionalism in doing so is superb.