Flight-refund rules may need reworking, watchdog says

Passenger-protection rules might need to be revised after hundreds of thousands of flight cancellations prompted by the COVID-19 pandemic left travellers out of pocket, the head of Canada’s transportation regulator said Wednesday.

Scott Streiner, who heads the Canadian Transportation Agency, said officials should ask “the obvious question” of why airlines do not have to refund passengers when flights are cancelled for reasons beyond the carrier’s control, such as a global virus outbreak.

“The situation that we’ve encountered over the past several months was unprecedented, it was completely unanticipated,” Streiner said. “And, as a result of it, we may need to collectively take a look at the framework that we’ve put in place for air passenger protection and ask ourselves whether there are lessons learned and whether there are any gaps that we need to address.”

A new passenger rights charter, which fully came into effect on Dec. 15, requires airlines to ensure that customers can complete their itineraries, but does not demand reimbursement.

“I think the question we now have to ask is, what happens if that’s not possible?” Streiner said, referring to completion of itineraries.

Most Canadian airlines have offered credits for a cancelled flight that are valid for at least two years and have kept billions in advance ticket sales amid a collapse of the travel industry.

Advocates say passengers have the right to a refund for services that were never rendered. “The law has always been clear that passengers are owed a refund,” said passenger rights advocate Gabor Lukacs, citing four CTA rulings. “The deficiency is in the failure to codify this obligation in the new regulations.”

The absence of a refund rule forms part of a larger problem of enforcement in the Air Passenger Protection Regulations, he said.

A February 2019 report by Air Passenger Rights, an advocacy group run by Lukacs, found that criteria for monetary compensation are extremely tough to meet, often requiring passengers to present evidence that is in the hands of the airline.