Many consumers are enticed by surprisingly low airfares only to be confronted with additional costs in the form of taxes and a host of administrative fees. Additional costs, which were initially hidden in an attempt to woo the hopeful holidaymaker. The European Commission has recently announced plans to prohibit airlines advertising misleading airfares.
Topic: Misleading pricing
Who: European Commission
When: July 2006
The European Commission has announced new proposals that will prohibit airlines from advertising misleading airfares.
This is part of a larger EU initiative to modernise aviation law as a whole. One of the Commission's other aims is to enhance safety levels by tightening up current licensing and leasing rules. In terms of pricing, the Commission proposes to revise existing rules to a) prevent misleading pricing and b) tackle discriminatory pricing.
Currently, consumers are often tempted by low airfares only to be informed that additional costs, such as taxes and fuel surcharges are not included. If these proposals are translated into legislation, airlines will be forced to publish the real price of the flight, including any unexpected “hidden” costs. According to the EU transport commissioner, Jacques Barrot, “Citizens must enjoy the benefits of the single market and have the possibility of more choice and quality. They must be able to easily compare fares between airlines”.
However, this is only half of the problem as airlines have adopted the practice of charging different prices to consumers, depending on the EU country in which they are resident. Such discriminatory pricing has been the subject of a number of complaints. The Commission has also addressed this issue and it is proposed that, at any given time, the price demanded by an airline, for the same seat, on the same flight, must be the same for all EU consumers.
The proposal is expected to run into opposition when it comes before the EU transport ministers, particularly in relation licensing and leasing reforms.
Why it matters:
We have all been tempted by the 99p flight to Rome, only to later learn of the unanticipated £50 stapling charge.
In 2006, more people than ever before are able to afford the cost of flying. It has been estimated that by 2020 there could be up to 2 billion air travel passengers a year within the EU alone. Against this background, it is important that consumers are able to take advantage of the best deals without being confused by misleading prices.