Lastminute.com will repay more than £7m in refunds for cancelled holidays

Lastminute.com has committed to repaying £7m in refunds for cancelled holidays following an investigation by the Competition and Markets Authority (CMA).

The CMA started investigating the online bookings firm after receiving complaints from people who hadn’t received refunds for package holidays that were cancelled due to the coronavirus pandemic earlier this year.

This is despite the fact that package holiday regulations state that customers are legally entitled to a cash refund within 14 days if the travel provider cancels the trip.

Over 9,000 customers are still waiting for refunds according to the CMA, which are valued at over £7m.

Following CMA’s intervention, lastminute.com has now signed formal commitments to pay these refunds by 31 January 2021 at the latest, with at least half of these paid by 16 December.

Anyone whose package holiday is cancelled by lastminute.com on or after 3 December will also be refunded within 14 days according to the law under the commitments signed by the company.

Andrea Coscelli, chief executive of the CMA, said: “Online travel agents have a legal responsibility to provide prompt refunds to customers whose holidays have been cancelled due to coronavirus – irrespective of whether the agent received refunds from airlines and accommodation providers.

“Our action today means that customers whose holidays were cancelled by lastminute.com will receive their money back without undue delay.

“The CMA is continuing to investigate package holiday firms following concerns that people are not getting the refunds they’re entitled to when bookings can’t go ahead because of the pandemic. If we find that businesses are breaching consumer protection law, we will not hesitate to take further action.”

A spokesperson for lastminute.com told The Independent: "Since March we made refunding customers our number one priority and we’re pleased to reiterate this commitment with the CMA. We engaged constructively with the CMA and while we have already refunded more than €200 million worth of bookings overall, it is the group's commitment to work through those that remain to be paid.

"After the commitments already taken by TUI UK, Virgin Holidays and other players in the market, our effort highlights how we are actively working on this side. Many other competitors and especially some airlines do not have still reached any factual commitment to act for refunding the customers.

“The entire travel industry is facing an unprecedented crisis including enormous challenges that our systems and processes had to face to manage such a huge volume of cancellations and refunds. We appreciate that the CMA has recognised the special circumstances that Covid-19 has created both for many travellers and players from the travel sector.”

The CMA has written to over 100 package holiday firms in relation to the delay in refunds due to the coronavirus pandemic. Many have struggled with the sheer volume of refunds at a time when many of their staff were also on furlough.

In October, Virgin Holidays repaid all outstanding refunds following CMA intervention, while Tui made the same commitments in September.