Airlines Obligated to Provide Cash Refund for Flight Cancellations, Says MATTA

KUALA LUMPUR, 8 April 2020 - The Malaysian Association of Tour and Travel Agents (MATTA) is concerned that many passengers and travel agents may not be getting refunds due to them from flight cancellations as a result of the Covid-19 pandemic.

MATTA Vice President Air Transportation Shazli Affuat Ghazali said, “Airlines should make cash refunds as their top priority and not issue credit notes which may have little or no value should they go insolvent. While they are being bailed out or given loans to resume operations post pandemic, they must first pay out cash refunds to restore public confidence.”

“It is a matter of principle to return payments collected from customers for services not rendered due to the current extraordinary circumstances.”

“We are disappointed by the silence of the authorities that include the Ministry of Transport Malaysia (MOT) and Malaysian Aviation Commission (MAVCOM).”

“One of MAVCOM’s functions is to provide a mechanism for protection of consumers and the Commission should have stepped forward to announce clearly what measures are in place or will be introduced for customers to get their money back. While it is painful enough for individual passengers to wait indefinitely for refunds, the agony is multiplied manifold among travel agents with angry customers constantly behind their back.”

“Airlines should give full refund for payments made by passengers and travel agents without applying standard terms and conditions, which are applicable during normal times but not in a pandemic. Also, airlines should not differentiate between group bookings for Group Inclusive Tour (GIT) and individuals travelling as Free Independent Travellers (FIT). The same treatment will hasten refunds across the board and recovery post pandemic. What the country needs now is strong and decisive leadership to resolve the issue.”

“For example, in the United States, airlines have been warned by their Department of Transportation (DOT) that passengers should be refunded promptly when their scheduled flights are cancelled or significantly delayed. Airlines have long provided such refunds in the aftermath of major but localised disasters, and they should continue with the precedents set in handling this pandemic.”

“MOT must take into cognisance that airlines are the first in the long line of supply chains and every action taken by them will ripple across the entire tourism industry. MATTA is looking forward to MOT issuing a directive to airlines that include:

• Notifying passengers and travel agents that normal cancellation and rebooking charges do not apply from the time of Covid-19 outbreak until end of pandemic.
• Granting customers the option for cash refund or available credit can be used within three years. Rebooking allowed within two years from original date of travel.
• Refunds for flight cancellations must be made in full, including ancillary fees paid.

“But if refunds due to travel agents are unfairly withheld, affected passengers will not be getting back their money. It could trigger unnecessary lawsuits which do not auger well for the tourism industry”, concluded Shazli.

Vice President Air Transportation
Term 2019 – 2021

For further information, contact:
MATTA Communications Department, or 03-9222 1155