The UK’s competition watchdog is promising to take action against Teletext if it finds it has broken the law over refunds for cancelled holidays.
The Competition and Markets Authority (CMA) has already intervened following complaints against several other travel companies, including TUI, Virgin, Lastminute and Loveholidays.
They have all since given undertakings to speed up refunds for holidays that have been cancelled due to the coronavirus crisis.
Now the CMA says it is looking into Teletext after receiving hundreds of complaints that customers aren’t being refunded for cancelled holidays.
It says it is looking into claims that Teletext has promised clients their money back but delayed the payment.
The CMA says it will ‘engage’ with Teletext to gather further evidence on whether the online travel agent has broken consumer protection law.
CEO of the CMA, Andrea Coscelli, said that while the pandemic is ‘presenting challenges for travel businesses’, it is important consumers are properly protected and firms comply with the law.
Under the Package Travel Regulations, holidaymakers should receive a refund within 14 days of a cancellation. Flight only customers should be refunded within seven days.
Many holiday companies have been taking longer than this to refund, especially at the start of the pandemic. The CMA says it has written to more than 100 travel companies to remind them of their obligations. It says it will also take action against Teletext if necessary.
However, the competition watchdog stressed that it is at the initial stage of its investigation, adding: “It should not be assumed that any business under investigation has broken consumer protection law.”
The CMA is also investigating whether airlines have breached consumers’ legal rights by failing to offer cash refunds for flights they could not lawfully take due to the pandemic.
What can the CMA do to help Teletext customers?
If the CMA finds Teletext has breached consumer law, it can secure commitments from the travel agent to speed up its refunds process. It has managed to do this successfully with many other travel companies during the pandemic and this is the most likely outcome if the CMA finds any wrongdoing.
The CMA can’t fine Teletext, but it can bring legal action against any company it believes is breaking the law and obtain redress through the courts.
On the other hand, if it finds consumer law has not been breached it will close its investigation.
What Which? says about Teletext investigation
Which? Travel says it has received a steady stream of complaints from Teletext Holidays customers. “Nearly a year on from the first wave of cancellations, it’s unacceptable for anyone to still be waiting for their money back,” said Editor Rory Boland.
“Customers have been understanding of the difficult circumstances travel companies faced in the past year, but it’s clear now that some operators feel empowered to act with impunity,” he said. “The regulator should establish the scale of the problem and, if necessary, quickly take appropriate action against the company to send a clear message that it will not stand for this kind of behaviour.”