MERIDIANA FINED FOR IMPROPER COMMERCIAL PRACTICES
PRESS RELEASE
PRESS RELEASE
Meridiana: Antitrust Authority fines the company for improper commercial practices regarding reimbursement of fares, insurance policies, compensation for delayed flights and its loyalty program.
Fines total Euro 970,000
The Italian Competition Authority, at its meeting on 4 September 2008, decided to impose fines on the airline Meridiana for improper commercial practices; the fines total Euro 970,000. In the Authority’s view, the company violated the Consumer Code in a number of different areas, adopting practices contrary to professional diligence and likely to alter significantly the economic choices of consumers.
Specifically, the Authority deemed improper the company’s practices in the following areas:
1) Reimbursement of Fares
Meridiana, on its flight booking website, includes a fuel surcharge linked to oil prices within the category “airport taxes and charges”. The same company website specifies that “airport taxes and charges are always reimbursable”. In reality, the fuel surcharge, being a component of the ticket price,is reimbursed only when the passenger opts for a FLEX fare and subsequently decides not to fly, but not in the case of promotional ticket prices.
Meridiana’s practice, since it does not give the consumer the ability to identify precisely the costs to be incurred in the case of a cancellation, was deemed improper in that it could mislead the consumer as to the amount to be reimbursed as of right.
For this practice, the fine was set at Euro 220,000.
2) Insurance Policy
The Authority also considered improper the method used for the optional insurance policy (at an extra cost of Euro 10) where silence is deemed consent: a consumer making an Internet booking who does not want the policy must remove the corresponding icon from the screen. In the Authority’s view, this is a method that may confuse consumers, misleading them into purchasing an additional, optional service without having fully understood its optional nature precisely because the choice is automatic, and consequently without having made a conscious decision in the matter.
For this practice, the fine was set at Euro 270,000.
3) Compensation to Passengers for Flight Delays
In the Antitrust Authority’s view, Meridiana’s website fails to inform passengers of their rights as recognized in national and international regulations in the case of flight delays. Furthermore, with respect to the enhanced protection stipulated for connecting domestic flights (any delay of more than 20 minutes entitles the passenger to a credit of Euro 15 to be used for the purchase of a future ticket), the investigation found that the airline does not comply with current regulations and obviously does not offer consumers adequate information on the subject.
For this practice, the fine was set at Euro 300,000.
4) The “HI-FLY 2007/2009” Loyalty Program
Finally, the Antitrust Authority deemed improper Meridiana’s practices in its “Hi-Fly 2007-2009” loyalty program. Consumers wishing to join the loyalty program have to take out a “co-branded” credit card: thus, on the one hand some consumers are not admitted to the program, while on the other hand there are costs and charges whose extent is not clearly spelt out by the airline.
Moreover, when issuing bonus tickets Meridiana makes the user pay a number of costs such as a charge for issuing the ticket, the fuel surcharge and a crisis surcharge, claiming they are taxes and charges, whereas they are costs typical of air transport.
For this practice, the fine was set at Euro 180,000.
Rome, 10 September 2008