LEGCO QUESTIONS

Arrangement of sale of air tickets by airlines

24 Feb 2016
BACK

Following is a question by the Hon Kenneth Leung and a written reply by the Secretary for Transport and Housing, Professor Anthony Cheung Bing-leung, in the Legislative Council today (February 24):

Question:

Recently, some members of the public have relayed to me that some airlines openly sold on their official web sites air tickets for flights not yet approved by the Civil Aviation Department, and put a remark on their reservation systems that the flights were “subject to government approval”. The airlines concerned subsequently changed the departure time of those flights unilaterally, without making any compensation to customers who had bought the tickets. In this connection, will the Government inform this Council:

(1) whether it knows the meaning of the words “subject to government approval” displayed on the ticketing web sites of these airlines; whether the existing legislation prohibits airlines from openly selling air tickets for flights which are subject to approval by the authorities; if not, of the reasons for that; if so, whether the Government has studied if the airlines concerned have breached the law;

(2) of the number of complaints received by the authorities in the past five years about the arrangements for the sale of air tickets by airlines and, among them, the number of those which were accepted by the authorities; and

(3) whether it knows if the airlines had, when selling air tickets for flights which were subject to government approval, clearly informed their customers that the airlines had the right to change the departure time of flights unilaterally without making compensation; if the airlines had not, whether it has studied if they have violated the provisions relating to “false trade descriptions” and “misleading omissions” in the Trade Descriptions Ordinance (Cap. 362); if it has studied, of the results?

Reply:

President,

At present, airlines are required to apply to the Civil Aviation Department (CAD) of the HKSAR and the relevant foreign aeronautical authorities for approval for the operation of flight services. In general, the strategy and arrangement of the sale of tickets for these services are not regulated under the bilateral Air Services Agreement (ASA) or local legislation concerning air transport.

Similar to other commercial organisations in the service industry, airlines will set out the sales conditions in relation to its provision of services. Airlines would set out the relevant conditions in accordance with the Conditions of Carriage. These conditions would include fares, taxes, fees and charges, details concerning refusal of and limitation on carriage, schedules, arrangement for cancellation of flights as well as details for compensations and refunds. Upon the purchase of an air ticket by the customer, these conditions will form part of the commercial contract between the airline and the customer. The commercial contract is not subject to the Government’s regulation but the details of the contract must comply with relevant legislations. Customers should check with the airline concerned or travel agents on the meaning and applicability of these conditions when purchasing an air ticket.

Irrespective of the reasons, should an airline fail to provide services after the air ticket is sold, the airline concerned must make necessary arrangement in accordance with the conditions set out in the air ticket or its performance pledge (e.g. arrange for another flight for its passengers or provide refunds), so as to minimise the inconvenience caused. Issues concerning compensations should be resolved and negotiated between the airline and the customer concerned in accordance with the Conditions of Carriage and conditions set out in the air ticket. Should the parties fail to reach a consensus, the case could be followed up with in accordance with the legislations on the protection of consumer interests in general.

My reply to the specific parts of the Hon Kenneth Leung’s question is as follows.

(1) As aforementioned, airlines are required to apply to CAD and the relevant foreign aeronautical authorities for approval for the operation of flight services. These services could only be provided with the approval of both aeronautical authorities. The strategy and arrangement of the sale of tickets for these scheduled services in general are not regulated under the bilateral ASA or local legislation concerning air transport. At present, while the Government has no legislation prohibiting airlines from selling tickets for services that are pending approval, the Government has reminded airlines that they should set out clearly the Conditions of Carriage so that customers could make an informed decision, including any possible risk.

(2) In the past five years, the number of complaint cases concerning airlines’ services received by the Transport and Housing Bureau (THB), CAD, the Consumer Council (CC) and the Customs and Excise Department (C&ED) is listed in Annex. However, there is no further breakdown on the nature of these cases (e.g. whether they are related to the arrangement for the sale of air tickets by airlines).

In general, if THB and CAD received complaints that are between an airline and its customers concerning tickets or services, depending on the respective circumstances, THB and CAD would relay the case to the airline concerned and urge the airline to follow up accordingly or advise the customers to contact CC for further assistance.

CC and C&ED will, upon receipt of complaints or reports, consider the nature of the case (e.g. whether the complainant only wishes to put the matter on record and requires no follow-up action) and whether there is sufficient information for follow-up action.

(3) As aforementioned, conditions including fares, taxes, fees and charges, details concerning refusal of and limitation on carriage, schedules, arrangement for cancellation of flights as well as details for compensations and refunds are set out in accordance with the Conditions of Carriage. These conditions will form part of the commercial contract between the airline and the consumer. Customers should check with the airline concerned or travel agents on the meaning and applicability of these conditions when purchasing an air ticket.

The Trade Descriptions Ordinance (TDO) prohibits certain unfair trade practices deployed by traders against consumers, such as “false trade descriptions” and “misleading omissions”. Every case is unique. Whether an offence under the TDO is committed should be determined according to the facts (including the act or omission by relevant persons) and evidence of each case. A generalised conclusion cannot be drawn readily. If consumers suspect traders (including airlines) of infringing the TDO, they may file a report with C&ED. C&ED will take appropriate follow-up action. If consumers consider the terms in individual consumer contracts to be unconscionable or to be affecting their consumer rights, and the dispute cannot be resolved by negotiation with the trader, they may consider lodging complaints with CC, pursuing mediation or obtaining legal advice for deciding whether to take legal action, which are existing ways for dealing with such matters.

Annex