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COVID-19: refund provided as voucher (for non refundable fares)

Old Apr 6, 20, 8:58 am
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European Commission EC261/2004 guidelines in context of COVD-19 dated 18 MAR 2020
US DoT Enforcement Notice regarding refunds dated 3 APR 2020.
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COVID-19: refund provided as voucher (for non refundable fares)

Old Mar 26, 20, 7:11 am
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Originally Posted by KLflyerRalph View Post
IANAL and my French isn't good either, but the accompanying report states:
So it also means that if one booked an hotel, a camp site, a rental car, or a "touristic activity", the suppliers (i.e the hotel, the camping the car rental company etc...) is allowed to provide an 18 month valid voucher to replace the refund.
In case the customer does not use the voucher within the 18 months, then the company must refund in cash the customer - but not before. In case the voucher is partially used, the company must refund the remaining value at the expiration of the voucher. The company also must inform the customer 30 days beofre expiry of the voucher that the given voucher is due to expire soon. That's my understanding of this ordonnance available on the legifrance website.
So again, if booked a flight ticket with AF, EC 261/2004 is still valid per this law.
However, if booked on AF a package flight+hotel or flight+rental car, then it's a bit unclear to me if you can request a full refund.
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Old Mar 26, 20, 7:29 am
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So then still, AF is not able to invoke this ordonnance and, until determined otherwise, should refund in money for a cancelled flight. Although I fear PAX who really want to go this far will have to go to court or a claim agency.
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Old Mar 26, 20, 7:39 am
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Originally Posted by CanuckInParis View Post

The EC, in their guidance from March 18 say that these laws around refunds fall outside the scope of EC261/2004, so it looks like their position is that if national law allows for refund in the form of a voucher, it still counts as a refund. The government and EC seem to be giving AF and other airlines legal cover to do this, which probably also why the credit card companies are refusing chargebacks: the airline has done what the law requires them to do under the circumstance.
That's not what the interpretative guidelines say - nor do I think that is what they intended to say, regardless of what the airlines might wish it to say.

Note it specifically mentions these "specific national rules" and vouchers only in the context of "in case the passenger could not take a flight that has been operated". It does NOT refer to flights that have been cancelled by the airline.

This is customer-friendly, because instead of coming away with zero, they at least have a *chance* of using that credit in future - i.e. at least getting a voucher on flights that were purchased as non-refundable tickets when the passenger can't or doesn't now want to travel, and which otherwise would have led to the passenger receiving nothing (albeit that most airlines had some kind of "change for free/get a voucher instead" scheme, anyway)

As such, these "national laws" supplement existing regulations, rather than overriding/clashing with EC261/2004.

The section referring to national law on refunds only applies to journeys which couldn't be taken - i.e. if the airline cancels, there should still be a refund...
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Last edited by irishguy28; Mar 26, 20 at 7:56 am
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Old Mar 26, 20, 7:53 am
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Originally Posted by KLflyerRalph View Post
So then still, AF is not able to invoke this ordonnance and, until determined otherwise, should refund in money for a cancelled flight. Although I fear PAX who really want to go this far will have to go to court or a claim agency.
I have legal insurance and would therefore not hesitate one minute in case KL refuse to refund and AMEX refuse a chargeback as well.
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Old Mar 26, 20, 8:44 am
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IANAL TINLA, but it sounds like AF's deal with Amex opens Amex up to a class action case here. IIRC airlines often have protection from class action cases under the ADA (granted, AF is an international carrier) but refusing to initiate an otherwise-valid chargeback because of a private company arrangement definitely seems like it is playing with fire. Particularly since it is down to changing T&C at the last minute...I dunno, does that rise to "conspiracy to defraud"?

(AF might also be in a spot due to changing the T&C like this. Again, IANAL TINLA but what is the status on airlines changing refund conditions long after the ticket has been purchased?)

BTW, the one thing that hits me raw here is that the "offer" is for an equal-cash-value voucher. At the very least, if they're going to jam this down folks' throats they should be forced to make it that or a same-route, same class-of-service voucher.

And per those regulations, my understanding on reading that is that the airlines are getting a bit of cover to not have to pay out if (for example) you had booked, the flight went, but you could not take said flight due to travel restrictions.
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Old Mar 26, 20, 8:58 am
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Originally Posted by GrayAnderson View Post
And per those regulations, my understanding on reading that is that the airlines are getting a bit of cover to not have to pay out if (for example) you had booked, the flight went, but you could not take said flight due to travel restrictions.
It's the exact opposite.

People holding non-refundable tickets are now able to obtain the value of their spend in a voucher. Which is far better than having the value of the ticket completely lost, which is what would happen to those non-refundable tickets under normal circumstances.

And most (all?) airlines have introduced these measures voluntarily, anyway. They have all been allowing people to not travel and still have some claim on using the value of their non-refundable tickets at some future date.
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Old Mar 26, 20, 10:54 am
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Originally Posted by irishguy28 View Post
That's not what the interpretative guidelines say - nor do I think that is what they intended to say, regardless of what the airlines might wish it to say.

Note it specifically mentions these "specific national rules" and vouchers only in the context of "in case the passenger could not take a flight that has been operated". It does NOT refer to flights that have been cancelled by the airline.

This is customer-friendly, because instead of coming away with zero, they at least have a *chance* of using that credit in future - i.e. at least getting a voucher on flights that were purchased as non-refundable tickets when the passenger can't or doesn't now want to travel, and which otherwise would have led to the passenger receiving nothing (albeit that most airlines had some kind of "change for free/get a voucher instead" scheme, anyway)

As such, these "national laws" supplement existing regulations, rather than overriding/clashing with EC261/2004.

The section referring to national law on refunds only applies to journeys which couldn't be taken - i.e. if the airline cancels, there should still be a refund...
In the same vein point 3.2 clearly states-

**3.2.Right to reimbursement or re-routing In the case of a flight cancellation by the airlines (no matter what the cause is), Article 5 obliges the operating air carrier to offer the passengers the choice among: a)reimbursement(refund); b)re-routing at the earliest opportunity,or c) re-routing at a later date at the passenger's convenience. Regarding reimbursement, in cases where the passenger books the outbound flight and the return flight separately and the outbound flight is cancelled, the passenger is only entitled to reimbursement of the cancelled flight....**

The game AF is playing is that they are only refunding fully refundable tickets (gee, thanks!). Non-refundable tickets get a voucher.
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Old Mar 26, 20, 12:30 pm
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Originally Posted by bostontraveler View Post
Unbelievable situation.
Yes, it most certainly is.

How far away was your originally scheduled flight? One could argue that AF can at least wait until that date has come and gone before even thinking about processing a refund. What if they reinstate the flight? (Admittedly unlikely if travel scheduled in the next couple of weeks). Then you'll be mandatorily subject to a voucher only, unless you do choose to travel.


Originally Posted by GrayAnderson View Post
IANAL TINLA, but it sounds like AF's deal with Amex opens Amex up to a class action case here. <snip> ...refusing to initiate an otherwise-valid chargeback because of a private company arrangement
I'm not sure what makes you believe this is an "otherwise-valid chargeback". The chargeback mechanism is really meant for unauthorized or erroneous charges (although I would imagine the cardholder agreement spells this out more clearly). This was fully authorized. Amex isn't supposed to be the arbiter of conflicting regulations either. Further, a successful chargeback doesn't necessarily absolve you of your obligation to the merchant, they can still sue you for the charge amount if they disagree with Amex, and that judgment will supercede whatever Amex does.

That said, I agree they should sweeten the pot with a bonus on the voucher, although there's a good chance that's already built in given fares will probably be lower a year from now than they were when the tickets were purchased.
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Old Mar 26, 20, 1:39 pm
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Originally Posted by ijgordon View Post
Yes, it most certainly is.

How far away was your originally scheduled flight? One could argue that AF can at least wait until that date has come and gone before even thinking about processing a refund. What if they reinstate the flight? (Admittedly unlikely if travel scheduled in the next couple of weeks). Then you'll be mandatorily subject to a voucher only, unless you do choose to travel.


I'm not sure what makes you believe this is an "otherwise-valid chargeback". The chargeback mechanism is really meant for unauthorized or erroneous charges (although I would imagine the cardholder agreement spells this out more clearly). This was fully authorized. Amex isn't supposed to be the arbiter of conflicting regulations either. Further, a successful chargeback doesn't necessarily absolve you of your obligation to the merchant, they can still sue you for the charge amount if they disagree with Amex, and that judgment will supercede whatever Amex does.

That said, I agree they should sweeten the pot with a bonus on the voucher, although there's a good chance that's already built in given fares will probably be lower a year from now than they were when the tickets were purchased.
10 days before travel.

With respect to chargebacks, I disagree. They're not just designed for fraud or erroneous charges. They fall under an umbrella of purchase protection-- if a product or service is not delivered, American Express (and Visa, and Mastercard) charge the merchant back. This "protection" is one of the services that they tout. American Express takes a cut of each transaction. Furthermore they charge a hefty annual fee for a Platinum card.

In black and white here: https://www.americanexpress.com/us/c...y-dispute.html

How is Air France different from say, an internet merchant who charged you and then didn't send you a product but refuses to refund you? Conceptually it is the same thing.

It's a real simple concept- one paid for a service which was not delivered. As such, a refund is due.
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Old Mar 26, 20, 1:49 pm
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In the same situation here. Nonrefundable trips cancelled, offered vouchers. Same with TAP Air Portugal. Vouchers everywhere, thousands of dollars.
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Old Mar 26, 20, 3:59 pm
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The permissible reasons for a chargeback vary by jurisdiction. Thus, there is certainly no uniform answer.

But, for a US-based card issuer, the failure of the vendor to deliver the service would most certainly entitle the cardholder (consumer) to a sustained chargeback absent a specific rule or agreement to the contrary.

France is simply limiting its governmental liability. AF will require a bailout or stock purchase or some combination. The less cash it has to operate, the more it will need. The French government is simply limiting the payment of cash and effectively shifting the costs from taxpayers as a whole to individual unlucky customers.
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Old Mar 26, 20, 6:57 pm
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Originally Posted by Often1 View Post
The permissible reasons for a chargeback vary by jurisdiction. Thus, there is certainly no uniform answer.

But, for a US-based card issuer, the failure of the vendor to deliver the service would most certainly entitle the cardholder (consumer) to a sustained chargeback absent a specific rule or agreement to the contrary.

France is simply limiting its governmental liability. AF will require a bailout or stock purchase or some combination. The less cash it has to operate, the more it will need. The French government is simply limiting the payment of cash and effectively shifting the costs from taxpayers as a whole to individual unlucky customers.
[QUOTE=Often1;32235706]The permissible reasons for a chargeback vary by jurisdiction. Thus, there is certainly no uniform answer.

I think a lot of Americans perhaps don't understand that financial systems work very differently abroad. Continental Europeans do not have "credit cards" in the way that Americans or Brits do. What you spend is automatically deducted from your account at the end of the month. That means that basically everyone in Continental Europe lives on a debit card. You can't choose how much to pay- it's all deducted 100%. So, in the case of American Express denying a dispute, that means your money is suspended indefinitely.

1) Reasons for a chargeback certainly vary by jurisdiction. However, in most countries, non-performance of contract is just that. Taken to a court of law, the non-performer is condemned. === The fact that American Express France refuses to even ACCEPT a dispute because "AF is our partner" is blatantly illegal. French legal scholars, feel free to interject.

2) AIR France is limiting its liability. Secondarily, France as a country may indeed be "Shifting the cost from taxpayers as a whole to individual unlucky customers" but that doesn't supersede French or European law.

Most importantly-- people are suffering. Many more are and will be out of work or soon will be unemployed--3.2m in the US in a matter of weeks is mindblowing. It's in this spirit that I am insistent. I can deal with a cash flow hit though it does cost me. But what about someone else for whom 1000 is rent and food?

AF will get its handout. Will its customers? Ask yourself that question.
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Old Mar 26, 20, 8:14 pm
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Originally Posted by carnarvon View Post
Does the EU want all airlines to go belly up?
If I paid you for a truck load of XXXX to be delivered on Date Y, but you didn't deliver it. I should get my money back.
(A) you didn't deliver said product; and
(B) you are not out fuel, time or material XXXX as you did not deliver it.
In this scenario, you should be lucky that there is no additional compensation due for your failure to live up to your end of the deal (contract). Often times there are additional losses for failure to meet contractual obligations. For instance if I had paid for a foundation to be built for a house and had lined up labor to build the walls.

In this case, I can understand that the reason was out of control of the airlines; however, they did not deliver what was agreed to. REFUND the $$ and be done.
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Old Mar 26, 20, 8:58 pm
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It is interesting to see how posters react differently depending on their nationality and, maybe more importantly, the extent their country has been affected by Covid.

People who have been in strict lockdown for weeks have a different appraisal of the situation. Especially as they start hearing of parents or parents' friends gone and witness the economy going into very slow gear.
It will provide countless PhD theses in all fields.

A wild guess, is that the strict reliance on legal proceedings in some countries could hamper an economic restart unless the current crisis does not hit that country as bad as forecasted by some experts. Not two crises are similar, but the Great depression might be too far away to be remembered even if conditions are very different today.
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Old Mar 26, 20, 10:38 pm
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Originally Posted by ijgordon View Post
I'm not sure what makes you believe this is an "otherwise-valid chargeback". The chargeback mechanism is really meant for unauthorized or erroneous charges (although I would imagine the cardholder agreement spells this out more clearly). This was fully authorized. Amex isn't supposed to be the arbiter of conflicting regulations either. Further, a successful chargeback doesn't necessarily absolve you of your obligation to the merchant, they can still sue you for the charge amount if they disagree with Amex, and that judgment will supercede whatever Amex does.

That said, I agree they should sweeten the pot with a bonus on the voucher, although there's a good chance that's already built in given fares will probably be lower a year from now than they were when the tickets were purchased.
Yes, but by (1) not flying the flight as originally scheduled (or something vaguely close to it) and (2) refusing to adhere to existing cancellation rules, the airline is the one in breach, particularly given the explicit EU261 rules in play.

As to fares being lower...right now I've got an upcoming flight on DL/VS. It's a round-trip in J for about $2300 from a local US airport to LHR, where a sale with tight conditions lined up with a planned trip. I do not have a realistic hope of matching that out down the line. It might happen but I'm not banking on it.
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