Qantas Agrees to $100 Million Penalty and Remediation Payments in Settlement with ACCC

Qantas has reached a settlement with the Australian Competition and Consumer Commission (ACCC), agreeing to pay a AUD 100 million (USD 66 million) penalty and offer remediation to around 86,000 customers. This resolution comes in response to charges that the airline sold tickets on flights that were either already cancelled or were about to be cancelled, avoiding a potential court battle. The agreement was announced on May 6, 2024, and is pending ratification by Australia’s Federal Court.

Under the terms of the settlement, affected customers will receive between AUD 225 and AUD 450 (USD 149-298), with the remediation program set to begin even before court approval. Vanessa Hudson, CEO of Qantas Group, described the settlement as a crucial step towards rebuilding trust in Australia’s national airline.

The ACCC had initiated legal action in September 2023, alleging that Qantas engaged in misleading practices by selling tickets on more than 8,000 flights between May and July 2022, which were cancelled but remained on sale for an average of two weeks after cancellation. In some cases, tickets were sold up to 47 days post-cancellation.

ACCC Chairwoman Gina Cass-Gottlieb condemned the airline’s actions as “egregious and unacceptable,” pointing out the disruption caused to consumers who made travel plans based on these “phantom flights.” However, she acknowledged Qantas’ cooperation in the matter. As part of the settlement, Qantas has committed to future practices that include notifying customers of cancellations as promptly as possible—within 48 hours of the decision—and ceasing the sale of tickets on cancelled flights within 24 hours. These commitments also extend to Qantas’ low-cost subsidiary, Jetstar Airways.

The financial impact of the remediation payments and penalty will be recognized by Qantas in its statutory income statement for the fiscal year ending June 30, 2024, as an expense outside of its underlying profit before tax. This settlement marks a significant effort by Qantas to rectify the fallout from its previous practices and enhance operational transparency and customer communication moving forward.