Both US and foreign airlines must give a “prompt” refund to passengers for flights to, within, or from the US that have been cancelled due to Covid-19, the US Transportation Department said on April 3.
“The obligation of airlines to provide refunds, including the ticket price and any optional fee charged for services a passenger is unable to use, does not cease when the flight disruptions are outside of the carrier’s control (e.g., a result of government restrictions)”, the transportation body said in its statement posted on its website.
The department said the directive is a response to the increasing number of complaints it has received from passengers, including those with with non-refundable tickets, who said they have been denied refunds for flights that were cancelled or significantly delayed.
It added that in many of these cases, the passengers said that the carrier they bought tickets from told them that they would get vouchers or credits for future travel.
“Because the Covid-19 public health emergency has had an unprecedented impact on air travel, DOT’s Aviation Enforcement Office will exercise its enforcement discretion and provide carriers with an opportunity to become compliant before taking further action,” said the transportation body.
The aviation industry is facing a fallout from the spread of the coronavirus, which has led to a growing number of countries closing their borders and a plunge in demand for travel worldwide.
In response to the ongoing crisis, carriers have drastically cut capacity or even suspended international flying altogether in an effort to reduce costs due to the surge in coronavirus cases worldwide. A number of carriers have also made cuts to staffing.
According to a report published by IATA (International Air Transport Association), airlines may burn through $61 billion of their cash reserves during the second quarter ending June 30, 2020.
Carriers are now seeking emergency aid in the wake of travel restrictions. Among countries providing specific financial or regulatory aid packages to the industry are Colombia, the United States, Australia, China, New Zealand and Norway.