LUXEMBOURG— Europe’s top court has ruled that airlines are responsible for refunding the full ticket price paid by passengers, including hidden booking commissions charged by online travel agencies, even if the airline did not directly receive or itemize those fees. The judgment settles a long-running legal dispute involving KLM Royal Dutch Airlines (KL) and passengers whose flights were cancelled during the COVID-19 pandemic.
The ruling clarifies how European passenger rights apply when tickets are purchased through intermediaries rather than directly from an airline. At the center of the case were flights booked via an online travel agency, departing from Vienna International Airport (VIE) and transiting Amsterdam Airport Schiphol (AMS), with Lima (LIM) as the final destination.
Refund dispute background
The dispute dates back to early 2020, when two passengers purchased round-trip tickets on KLM for travel from Vienna to Lima via Amsterdam. They paid a total of €2,053 through the online travel agency Opodo, which added a commission fee to the booking.
After pandemic-related travel restrictions forced the cancellation of the flights, the passengers requested a full refund under European Union passenger protection rules.
KLM processed the refund but returned only €1,958, excluding €95 per passenger that Opodo had charged as commission, reported Paddle Your Own Kanoo.
Unwilling to accept a partial refund, the passengers filed a complaint with Austria’s consumer protection authority.
While a local court initially sided with KLM, the watchdog appealed, eventually pushing the case to the European Court of Justice for a definitive interpretation of EU law.
KLM defense rejected
KLM argued that it could not refund the commission because it neither charged nor controlled the fee.
The airline maintained that it did not know whether Opodo had applied a commission or how much passengers had been charged, and therefore could not be held liable for returning that amount.
Consumer advocates countered that Opodo acted as an authorized sales agent with a long-standing commercial relationship with the airline. They argued that passengers’ contractual relationship was ultimately with the carrier, regardless of how the ticket was sold.
The European Court of Justice rejected KLM’s position, ruling that an airline’s obligation is to refund the exact amount paid by the passenger for the ticket. The court emphasized that carriers cannot shift the burden of recovering booking fees onto travelers, particularly when refunds are mandated by law.
Broader passenger impact
In its judgment, the court warned that denying refunds of hidden commissions could undermine consumer confidence in online booking platforms.
Forcing passengers to pursue separate claims against travel agencies, the judges noted, could discourage competition and reduce price transparency in the market.
The ruling strengthens passenger protections across the European Union by reaffirming that refunds must reflect the total cost borne by travelers. It also places greater responsibility on airlines to account for the actions of their authorized sales partners.
The decision follows a broader pattern of consumer-friendly judgments from the European Court of Justice in aviation matters.
However, it also highlights the court’s strict reliance on legal definitions, even when outcomes prove controversial, as seen in recent rulings on airline liability limits.
Bottom Line
The European Court of Justice has made it clear that when flights are cancelled, airlines must refund every euro a passenger paid, including undisclosed booking commissions.
For travelers, the decision removes ambiguity and strengthens refund rights, while airlines and travel agencies may now need to reassess how fees are disclosed and settled.
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