British Airways and Ryanair investigated over Covid refunds

The Competition and Markets Authority will investigate whether consumer laws were broken during the pandemic.

A Ryanair plane (PA Wire)

British Airways and Ryanair are under investigation over whether they breached consumer laws by not offering refunds for flights that were operating but customers could not take due to the Covid pandemic.

The Competition and Markets Authority (CMA) said the companies may have needed to issue refunds for flights that took place but were not allowed for non-essential travel.

The watchdog will be writing to both airlines as part of an investigation.

During the pandemic BA offered vouchers or rebookings, while Ryanair provided the option to rebook on flights that operated but should only have been used for essential travel, the CMA added.

While we understand that airlines have had a tough time during the pandemic, people should not be left unfairly out of pocket for following the law

Andrea Coscelli, CMA

BA said it offered refunds for all flights that were cancelled.

Legally, customers are entitled to a cash refund within 14 days.

The watchdog said: “The CMA is concerned that, by failing to offer people their money back, both firms may have breached consumer law and left people unfairly out of pocket.

“It is now seeking to resolve these concerns with the companies, which may include seeking refunds, or other redress, for affected customers.”

CMA chief executive Andrea Coscelli added: “While we understand that airlines have had a tough time during the pandemic, people should not be left unfairly out of pocket for following the law.

“Customers booked these flights in good faith and were legally unable to take them due to circumstances entirely outside of their control. We believe these people should have been offered their money back.”

The agency added that it should not be assumed either airline has broken the law.

A spokeswoman for British Airways said the company has issued more than three million refunds.

British Airways planes (PA Archive)

She added: “We continue to offer​ highly flexible booking policies at the same time as operating a vastly reduced schedule due to Government-imposed travel restrictions, and we have acted lawfully at all times.

“It is incredible that the Government is seeking to punish further an industry that is on its knees, after prohibiting airlines from meaningful flying for well over a year now.

“Any action taken against our industry will only serve to destabilise it, with potential consequences for jobs, business, connectivity and the UK economy.​”

It comes after the CMA launched enforcement action against several package holiday firms, forcing them to agree to offer cash refunds to customers.

Last month, package holiday firms Teletext Holidays and Alpharooms agreed to hand back £7 million to customers who saw their holidays cancelled due to the Covid-19 pandemic.

It follows similar agreements made by LoveHolidays, Lastminute.com, Virgin Holidays and Tui UK, after thousands of customers complained that the companies had failed to refund them for cancelled trips.

The travel sector has been one of the hardest hit during the pandemic and has faced the most scrutiny from the CMA, which wrote to more than 100 firms reminding them of their responsibility to process all refunds within 14 days by law for any cancellations.