IATA is building forces to combat a new refund policy set to come into force in South Korea that is mis-aligned with global standards.
The Korea Fair Trade Commission (KFTC) intends to require airlines to provide a full ticket refund—and not charge a cancellation fee—if a passenger chooses to cancel their flight 90 days or more before their departure date.
Essentially, it removes non-refundable tickets from the market. For sure this will limit choice
The new policy would not cover administrative costs incurred by the airline when the flight was booked. But it would exempt some deeply discounted tickets.
“Imposing a full refund 90 days before departure could disadvantage the very consumers KFTC seeks to protect,” said Vinoop Goel, IATA’s Regional Director, Airport, Passenger, Cargo and Security, Asia Pacific.
“Essentially, it removes non-refundable tickets from the market. For sure this will limit choice. And it will likely lead to higher prices.
“If the ability to differentiate with refund restriction is lost, the consumer benefits associated with this differentiation, principally choice and lower fares, will also be lost.”