The holiday booking site sparked hundreds of complaints from customers who failed to receive refunds after their travel deals were cancelled due to Covid.

Many have waited more than 14 days for their money back – far exceeding the repayment window set out by law.

Following an investigation and intervention by the Competition and Markets Authority (CMA), Lastminute.com has now committed to pay the refunds as soon as possible and by 31 January 2021 at the latest. It will need to repay at least half of customers by 16 December 2020.

Further, as part of its undertakings, anyone entitled to a refund for a holiday cancelled by Lastminute.com on or after 3 December 2020 will be paid within 14 days.

To ensure that Lastminute.com adheres to its commitments, it must provide the CMA with regular reports on the progress of refunds.

Andrea Coscelli, chief executive of the CMA, said: “Online travel agents have a legal responsibility to provide prompt refunds to customers whose holidays have been cancelled due to coronavirus – irrespective of whether the agent received refunds from airlines and accommodation providers.

“Our action today means that customers whose holidays were cancelled by lastminute.com will receive their money back without undue delay.

“The CMA is continuing to investigate package holiday firms following concerns that people are not getting the refunds they’re entitled to when bookings can’t go ahead because of the pandemic. If we find that businesses are breaching consumer protection law, we will not hesitate to take further action.”

The move comes after the CMA’s action in the holiday refund space, securing commitments from Virgin Holidays, TUI, Sykes Cottages and Vacation Rentals.

It has also written to over 100 package holiday firms reminding them of their obligations to comply with consumer protection law.

‘We have already refunded more than €200m worth of bookings’

A Lastminute.com spokesperson, said: “Since March we made refunding customers our number one priority and we’re pleased to reiterate this commitment with the CMA. We engaged constructively with the CMA and while we have already refunded more than €200 million worth of bookings overall, it is the group’s commitment to work through those that remain to be paid.

“After the commitments already taken by TUI UK, Virgin Holidays and other players in the market, our effort highlights how we are actively working on this side. Many other competitors and especially some airlines have still not reached any factual commitment to act for refunding customers.

“The entire travel industry is facing an unprecedented crisis including enormous challenges that our systems and processes had to face to manage such a huge volume of cancellations and refunds. We appreciate that the CMA has recognised the special circumstances that Covid-19 has created both for many travellers and players from the travel sector.”