The Ministry of Social Rights, Consumption and Agenda 2030 has fined five of the largest low-cost airlines with almost 179 million euros for finding that they carry out abusive practices by charging passengers, for example, for carrying hand luggage. or by reserving adjacent seats, to accompany dependents during the flight.
This is a historic fine, due to its amount, because it is the first of this nature decided by Consumer Affairs and because it calls into question the practices carried out by companies such as Ryanair, Vueling, Easyjet, Norwegian and Volotea. However, the sanction is not yet completely firm, because it can be appealed to the courts, and the companies assure that they are not committing any type of irregularity, which is why they are going to take up the battle in court.
We analyze the keys to this sanction that can change the way the airline sector operates.
Why is it fined?
For five practices that, in the opinion of the Ministry of Social Rights, Consumption and Agenda 2030, are very serious and abusive. Practices that he also urges to stop, because the fine entails stopping these types of actions.
The first irregular practice is that these companies require “the payment of a supplement for the transportation of hand luggage in the cabin.” That is, when the suitcase meets the size and weight conditions to go in the cabin, the airlines allege some reason (such as there is no space) to require that luggage to be lowered into the hold of the plane and charge for it.
The second, that they require “the payment of an extra cost on the price of the ticket for the reservation of adjacent seats in the case of minors and dependent people and their companions”, when they must travel accompanied by the person who cares for them.
Also, for “not allowing cash payment at Spanish airports”, for example, when you have to pay for checking in luggage once you are at the airport and they require payment by credit card.
The other two causes focus on the “imposition of a disproportionate and abusive fee on passengers for printing the boarding pass” and the “misleading omissions of information and lack of clarity in the prices published both on its own website and from third parties, making it difficult for consumers to compare price offers and make their decisions.”
Furthermore, in the case of Ryanair another reason is included, because the Irish multinational is sanctioned for “a practice by which users are charged a disproportionate amount for printing the ticket at the terminal when they do not have it.” ”, as broken down by the Ministry.
Why are they sanctioned now?
The sanction is not something unexpected for companies, because for months they have known that they are being investigated for this type of practices. Furthermore, the root of this process must be sought in 2014. Then the Court of Justice of the EU determined that airlines can charge passengers for checked luggage, for suitcases that go in the hold. However, the carry-on was considered an essential element for travelers, so you cannot charge for it, except when the weight and dimension criteria are not met, explains Consumo.
However, since 2019 some of the companies began to implement this type of now sanctioned practices, as explained by the aforementioned sources. Some practices that have had a knock-on effect, because the ‘low cost’ companies have been copying each other when they see that this type of actions are profitable.
Until two years ago, the Ministry did not have sanctioning capacity, which is now being exercised. The Ministry itself explains that this investigation was initiated by the General Directorate of Consumer Affairs in 2023 in response to practices considered “very serious”, for going against the General Consumer Defense Law.
And what happened this Friday is that Minister Pablo Bustinduy has confirmed the sanctions proposed by the General Secretariat of Consumer Affairs and Gaming, which has dismissed the appeals filed by these companies, thus putting an end to this investigation. It is the first time that sanctions considered very serious have been finalized since the Ministry acquired sanctioning powers in June 2022.
Which companies are sanctioned and with what fine?
The five companies sanctioned are Ryanair, Vueling, Easyjet, Norwegian and Volotea, but the sanction for each one is different. The highest is that of Ryanair, more than 107.7 million euros, because, as previously mentioned, more practices considered abusive have been found.
The second largest is Vueling. In the case of the IAG group subsidiary, 39.2 million euros are imposed. And, the third, Easyjet, with 29 million. The other two sanctions are much smaller: 1.61 million in the case of Norwegian and 1.18 million for Volotea.
Consumption explains that “to guarantee the proportionality and effectiveness of the sanctions imposed” and so that they have a “deterrent effect” they have been calculated based on “the illicit benefit obtained.” That is, the fine has been decided based on the benefits obtained with these abusive actions and according to the sanctioning regime of the Consumer Law which establishes that, for practices classified as very serious, the sanctions can be between six and eight times the illicit benefit obtained.
The reason why Ryanair’s sanction is higher is because it is the airline that has obtained the most resources with these practices that you consider abusive. Sums that, the aforementioned Consumer sources emphasize, have been decided with very prudent criteria and with information from the companies’ income statements and estimates, because the companies have not been proactive when it comes to providing information.
Are the sanctions final?
Now the Administration part is closed, but the Judicial part is opened, so the process cannot be concluded.
Specifically, sanctioned companies can file a contentious-administrative appeal before the National Court. They have a period of two months to do this. If this deadline is met and the companies have not filed an appeal, the sanctions become effective, both in amount and in the requirement to stop these practices. However, the companies intend to appeal.
What are the airlines going to do?
They say that with the sanction “nothing changes”, because now they enter judicial territory, once they appeal before the National Court.
Following the Ministry’s decision, the president of the Association of Airlines (ALA), Javier Gándara, confirmed to the media that the companies are not only going to appeal, but are also going to request precautionary measures from the National Court so that do not have to change their actions and cause damage that, in their opinion, “cannot be repaired.” According to Gándara, who is also general director of easyJet in Spain, the entire judicial process can be extended by two years.
“It is neither viable nor reasonable to propose changes until the Courts rule on this Consumer decision, taking into account the very detrimental effects that could be generated on passengers,” said the head of the airline association.
The International Air Transport Association (IATA) has also reacted and assures that the sanctions “far from protecting the interest of consumers, are a slap in the face to travelers who prefer to have options.” “Prohibiting all airlines from charging for hand luggage means that this cost will automatically be reflected in the price of the tickets,” he says. “What will be next? Force all hotel guests to pay the price of breakfast? Charge all spectators for the use of a cloakroom during a concert? EU law protects freedom of pricing for good reason. And airlines offer a range of services from all-inclusive to basic transportation. This measure by the Spanish Government is illegal and must be stopped,” says Willie Walsh, director general of IATA, in a statement.
So can they continue to charge?
Yes, until the Administrative Litigation Chamber of the National Court makes a ruling.
The first thing you will have to decide is about the precautionary measures that the airlines are going to claim. That is, if they ask for precautionary measures regarding the fines and the continuity of the sanctioned practices, the National Court will have to rule on both issues.
Most likely, he will accept the two precautionary measures until he gets to the bottom of the matter and makes a ruling. If so, the airlines will be able to continue charging and carrying out these practices until there is – if there is – a ruling that goes against them.
In the latter case, the fines may increase and be higher, depending on the period of time that the aforementioned practices considered abusive continue to be carried out.
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