Qantas agrees to pay $79 million in compensation and a fine for selling seats on canceled flights

FILE – A Qantas Boeing 737 passenger plane takes off from Sydney Airport, Australia, on Sept. 5, 2022. Qantas Airways agreed to pay 120 million Australian dollars ($79 million) in compensation and fines for selling tickets on thousands of cancelled flights, the airline and Australia’s consumer watchdog said on Monday, May 6, 2024. (AP Photo/Mark Baker, File)

CANBERRA, Australia (AP) — Qantas Airways agreed to pay 120 million Australian dollars ($79 million) in compensation and a fine for selling tickets on thousands of cancelled flights, the airline and Australia’s consumer watchdog said on Monday.

The Australian Competition and Consumer Commission sued the Sydney-based airline in the Federal Court last year. The commission alleged that Qantas engaged in false, misleading or deceptive conduct by advertising tickets for more than 8,000 flights from May 2021 through to July 2022 that had already been canceled.

Qantas agreed to settle the suit by paying a AU$100 million ($66 million) fine to the Australian government and a projected AU$20 million ($13 million) to more than 86,000 affected customers.

“Today represents another important step forward as we work towards restoring confidence in the national carrier,” Qantas chief executive Vanessa Hudson said in a statement.

“When flying resumed after the COVID shutdown, we recognize Qantas let down customers and fell short of our own standards. We know many of our customers were affected by our failure to provide cancellation notifications in a timely manner and we are sincerely sorry,” said Hudson, who replaced Alan Joyce at the airline’s helm in November last year.

FILE – A Qantas jet arrives at Melbourne’s Tullamarine Airport in Melbourne, Australia, Dec. 12, 2023. Qantas Airways agreed to pay 120 million Australian dollars ($79 million) in compensation and fines for selling tickets on thousands of cancelled flights, the airline and Australia’s consumer watchdog said on Monday, May 6, 2024. (AP Photo/Mark Baker, File)

A Federal Court judge has yet to accept the settlement.

ACCC chair Gina Cass-Gottlieb said Qantas’ payments of AU$225 ($149) to domestic ticket holders and AU$450 ($298) for international bookings were in addition to other remedies already provided by Qantas, including alternative flights and refunds.

“We are pleased to have secured these admissions by Qantas that it misled its customers, and its agreement that a very significant penalty is required as a result of this conduct,” Cass-Gottlieb said in a statement.

“Qantas’ conduct was egregious and unacceptable. Many consumers will have made holiday, business and travel plans after booking on a phantom flight that had been cancelled,” she added.

Qantas also admitted its misconduct continued until August last year, more than a year longer than the regulator has alleged in court, Cass-Gottlieb said.

The regulator initiated the suit a week after Qantas posted a record profit for the fiscal year that ended June 30, 2023, following years of losses due to the pandemic.

Its underlying profit for 2022/23 before tax was AU$2.47 billion ($1.6 billion), compared to a AU$1.86 billion ($1.2 billion) loss in the previous year.

Qantas reported a profit of AU$1.74 billion ($1.13 billion) after taxes for the latest year.