Hopes of a cash refund dashed for Ryanair and BA customers for flights impacted by Covid as regulator shuts down investigation

The Competition and Markets Authority (CMA) said a lack of clarity within the law meant it was "insufficiently certain" whether the watchdog would be able to secure refunds for British Airways and Ryanair passengers, despite stating earlier this year that it felt these customers "should be offered their money back".

The CMA launched its investigation in June after both airlines refused to give cash refunds to travellers who were lawfully unable to fly during the pandemic, with British Airways offering vouchers or the ability to rebook and Ryanair only providing the option to rebook.

The watchdog wrote to the airlines on the back of its concerns that, by failing to offer people their money back, the two companies may have breached consumer law and left people unfairly out of pocket. For full info on your refund rights if your trip's disrupted by the pandemic, see our Coronavirus travel rights guide.

CMA: 'Given the importance of this to many passengers who have unfairly lost out, we hope the law in this area will be clarified'

But today the CMA concluded that, after a "thorough examination of the relevant law", the law "does not provide passengers with a sufficiently clear right to a refund".

Andrea Coscelli, chief executive of the CMA, said: "We strongly believe people who are legally prevented from taking flights due to lockdown laws should be offered a full refund and we launched this investigation in the hope we would be able to secure a positive outcome for consumers.

"However, after considering the relevant law and gathering evidence in our investigation, we have concluded that the length of time required to take this case through the courts, and the uncertain outcome, can no longer justify the further expense of public money."

Under consumer protection law, passengers are entitled to refunds when an airline cancels a flight, because the firm cannot provide its contracted services. However, the CMA said it does not clearly cover whether people should be refunded when their flight goes ahead but they are legally prevented from taking it.

What do British Airways and Ryanair say?

A spokesperson for British Airways said: "During this unprecedented crisis we have acted lawfully at all times, issuing nearly £4 million in refunds and offering highly flexible booking policies enabling millions of our customers to change their travel dates or destinations."

A Ryanair spokesperson said: "Ryanair welcomes the CMA's decision to close its investigation. We operated a limited schedule during UK lockdowns for customers who travelled for essential reasons. Passengers had the option to change their bookings without paying the flight change fee and many availed of this option."