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Holiday firms to be investigated over refunds

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Written by: Emma Lunn
22/05/2020
Package holidays now included in CMA coronavirus investigation.

The Competition and Markets Authority (CMA) says airlines and holiday firms will now be included in its investigation into firms exploiting the coronavirus pandemic.

The CMA set up a Covid-19 Taskforce on 20 March to tackle businesses exploiting the pandemic by charging excessive prices or making misleading claims about their products.

Between 10 March and 17 May it was contacted more than 60,000 times about coronavirus-related issues.

The three sectors which were initially prioritised were holiday accommodation, weddings and events, and nurseries.

Since mid-April, the majority of complaints received by the CMA have been about unfair practices in relation to cancellations and refunds. Holidays and airlines account for almost 27,000 complaints, three-quarters of the total number of complaints about cancellations and refunds.

As a result of the rise in the number of complaints, package holidays have now been included in the scope of the investigation.

Rory Boland, editor of Which? Travel, says: “The CMA’s decision to include package holidays in the scope of its investigation into cancellations and refunds is a positive step, given the huge number of customers that are being left out of pocket by operators openly breaking the law on refunds.

“Many holiday companies also continue to push refund credit notes onto customers, without making it clear when they are legally entitled to a cash refund and with no assurance from the government that these are financially protected, further adding to confusion from consumers around if and when they will ever see their money again.

“The regulator must be ready to come down strongly against any package holiday provider unnecessarily delaying or denying refunds for cancelled holidays, to ensure that passengers have their money returned to them swiftly and trust in the industry is restored.”

Earlier this week Ryanair was accused of misleading customers by telling them that initiating a chargeback on their card for a cancelled flight was “fraudulent activity” which could result in them being banned by the airline.

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