JaseWGTN From New Zealand, joined Mar 2000, 825 posts, RR: 1 Posted (13 years 2 months 2 weeks 3 days 21 hours ago) and read 2309 times:
Freedom Air In Hot Water Again
14/03/2002 02:53 PM Phil Boeyen, ShareChat Business News Editor
Air New Zealand's (NZSE: AIR) discount carrier Freedom Air is in hot water again with the Commerce Commission for the way it advertises its fares.
The Commission is planning to prosecute the airline for allegedly misleading advertising which failed to properly disclose the full amount of the fares being promoted.
"In addition to the advertised airfares, passengers were required to pay costs in the form of Civil Aviation Authority (CAA) and insurance "levies" which were either not disclosed or inadequately disclosed in advertising," the Commission says.
"Also, the Commission alleges that the insurance "levy" was in fact an operational cost and that Freedom Air was inaccurately representing the nature of this cost."
This latest regulatory action follows a prosecution of Freedom Air in October 2000 for making false or misleading claims about the prices of its "Christmas airfare sale". That breach cost the airline $4,000.
The Commerce Commission says while its latest allegations relate to Freedom Air, it is concerned that other airlines might be advertising in a similar way.
"Other airlines might also be misrepresenting the costs of flights and the nature of insurance and other costs," says chairman John Belgrave.
"We are now investigating to see if this is a widespread practice or whether Freedom Air is the only airline operating in this way."
Mr Belgrave says consumers must be able to rely on the overall impression created by advertising in the travel industry and all important terms and conditions must be accurately and clearly explained.
He says the Commission will take further action if it finds other airlines are advertising in a misleading manner.
TG992 From New Zealand, joined Jan 2001, 2910 posts, RR: 10
Reply 1, posted (13 years 2 months 2 weeks 3 days 21 hours ago) and read 2300 times:
This is very interesting.
As far as I can remember, SJ included the levys/caa info in the small print of all their ads.
If indeed this is unacceptable, what ramifications will this have, given that NO airline I know of includes the levys and taxes in their initially published prices?
(I agree that the YQ tax is an 'increased cost of doing business', however).