Coronavirus: Watchdog threatens legal action on holiday refunds

Firms that fail to refund people for holiday and weddings cancelled because of the coronavirus outbreak could face legal action by the consumer watchdog.

The Competition and Markets Authority says it will take companies to court if they flout the law.

It says four out of five complaints made to its Covid-19 Taskforce are about cancellations and refunds.

Issues include holidaymakers being pressured to take vouchers instead of refunds for accommodation.

Meanwhile, some wedding venues are refusing to refund any money.

The CMA said the holiday vouchers being offered can only be used during a more expensive period, while wedding venues are telling people to claim on their insurance.

At the same time, the CMA said some nurseries were asking people to pay very high sums in order to keep a place open for their child.

Consumer law requires that a full refund is offered if a business has cancelled a contract without providing any of the promised goods or services.

This includes if no service is provided because of restrictions during the current lockdown or if a consumer cancels because of the restrictions.

‘Distressed’

Adam French, Which? consumer rights expert, welcomed the CMA’s move.

He said: “We’ve heard from many distressed people who risk being left out of pocket for significant sums of money as they struggle to get refunds for cancelled weddings, private events, or holiday accommodation.

“It’s right the CMA investigates sectors that are skirting their legal responsibilities on refunds and cancellations by trying to rely on unfair and unenforceable terms and conditions.

“The regulator must be prepared to step in and take strong action against any businesses found to be breaching consumer law and taking advantage of consumers during these unprecedented times.”