I’ve written about airlines like JetBlue and United breaking the law by refusing customer refunds. Other airlines like SWISS and British Airways have used trickery to keep customers from being aware of their refund options when purchased flights no longer operate.
- The European Union has relaxed passenger compensation requirements, but reaffirmed that a customer is entitled to a refund when their flight is cancelled.
- U.S. Department of Transportation rules require a refund when an airline cancels a customer’s flight.
While airlines are lobbying to be allowed to keep customers’ money even when they don’t provide transportation (offering a voucher for future travel instead), that’s not the current law.
Nonetheless, two more airlines at least have added themselves to the list of those refusing to honor refunds for cancelled flights as a matter of official policy: Lufthansa and Kenya Airways.
Here’s the Lufthansa notice to travel agents:
Lufthansa Group airlines temporarily disable refund functionality
The refund functionality for Lufthansa Group airlines’ tickets has been temporarily disabled in all reservation systems as well as on the airlines’ websites and on lhgroup-agent.com. Refunds requests already submitted will be processed at a later stage.
We are committed to supporting you in serving your customers. Additional details on how you can support your customers will be provided as soon as possible.
23.03.2020 11:47 Hours CET
Kenya Airways is reportedly even refusing to provide refunds for fully refundable tickets. Why would anyone ever buy a refundable ticket again after this?
The COVID-19 pandemic is a clear force majeure event. Airlines are entitled to be relived of their obligation to provide transportation. Generally force majeure entails both parties effectively voiding a contract and being returned to their previous position. It doesn’t allow one party not to perform while still keeping the money.
As a purely academic exercise I’m certainly interested in hearing from legal experts among readers who are especially familiar with this area of law, to speak to whether there are analogues for what these airlines are trying to do.
Nonetheless, it’s in no way controlling in this situation. Based on EU and US regulations, flights on US or European airlines or itineraries flying from the US or Europe, are subject to refund based on flight cancellations. Period.
Airlines are in a very difficult spot. They have fixed costs, and incoming revenue drying up. Being desperate, however, does not excuse theft. And in the past two weeks the capital markets have remained open to airlines with American adding $1 billion in liquidity, United adding $2 billion, and Delta adding $2.6 billion. None have yet tapped their frequent flyer programs to raise cash.