Thousands of Australians who had their travel cancelled due to the COVID-19 pandemic will receive additional refunds from tour operator APT.
The Australian Competition and Consumer Commission says Australian Pacific Touring, trading as APT and Travelmarvel, has agreed to stop deducting marketing and overhead costs from refunds.
The ACCC said it was concerned about the fees APT had been charging customers who had their travel cancelled, and that it had accepted a commitment from the company to address the issue.
The company will still be able to deduct amounts from refunds to cover reasonable losses it cannot recover, as well as an administration fee.
The company will provide customers who have previously received a refund quote with a revised quote, and will reimburse customers who have already received a reduced refund due to marketing and overhead cost deductions, according to the ACCC.
“The costs that APT deducted for marketing and overheads amounted to 15 per cent of the booking price and, with many holidays costing over $20,000, this meant a significant amount was withheld from the refunds given to consumers,” ACCC Commissioner Sarah Court said.
“The ACCC considered that APT was not entitled to deduct these marketing and overhead costs as they were incurred before the booking was made and they would have been incurred regardless of whether a booking was made.”
In October, the ABC revealed a Cairns couple had been charged $10,000 in cancellation fees after their overseas trip with APT had been cancelled due to the pandemic.
Many other customers have taken to social media to express their frustrations with fees being charged by APT.
“We are pleased that thousands of customers will now receive additional refunds and that this commitment will provide faster redress for consumers than court action, which would have been our next step,” Ms Court said.
The ACCC understands affected customers have either already been contacted by APT or will shortly be contacted about their revised refund.
“The ACCC’s position on refunds for cancelled travel has been very clear for almost a year now,” Ms Court said.
“Travel businesses cannot deduct fees unless there are applicable terms and conditions in their contract that expressly permit them to do so.”
‘Different interpretation’ of terms and conditions
APT group managing director Chris Hall said the company had been “navigating an extraordinary environment, unlike anything seen before”.
“During this time, we have been working closely with guests who have been affected by national and global travel suspensions to find the best possible outcome for them,” he said.
“We have also been in discussions with the Australian Competition and Consumer Commission over the matter of customer refund policy arrangements.
“The APT Travel Group understands the ACCC has a different interpretation of our terms and conditions in relation to refunds. However, we have reached a mutually agreed position.”
Mr Hall confirmed for some guests affected by imposed suspensions, this meant the refund amount initially advised, paid, or available to them would be increased.
‘We need a fairer system’: Choice
Erin Turner from the consumer group Choice said the organisation had dealt with thousands of complaints about travel refunds.
“APT customers should be proactively contacted about a further refund,” she said.
“If you’ve paid an excessive fee, you can check the terms and conditions to see if that fee matches what a company said they would do.
“You can recontact the company for a fairer refund or escalate to your state or territory fair trading office.”
She said the system was still difficult for consumers to navigate.
“Ultimately, what this ACCC action shows is that customers have to rely on the specific terms and conditions when negotiating pandemic-related travel refunds,” Ms Turner said.
“This approach leaves consumers to work through complex legal language and negotiate directly with powerful large companies.
“We need a fairer system for travel refunds to make sure everyone has clear and fair refund rights.”
Melbourne consumer advocate Adam Glezer said any money refunded to customers was a good thing, but he called for an inquiry into how the industry had handled the pandemic.
“I question how APT can charge a $400 per person administration fee to process refunds when it is not in the customers’ original terms and conditions,” he told the ABC.
“Australians have continuously experienced issues with obtaining refunds from travel companies since COVID-19 began.
“A review of the Australian Consumer Law to include a right to a refund for such instances is desperately needed.
“A parliamentary inquiry into travel is a must.”