Israeli Supreme Court Rules Travel Agents Cannot Charge Fees for Flight Refunds
Translated & summarized from Mako by baba
The story in 5 lines · by baba
- Travel agents in Israel cannot charge fees for processing flight refunds.
- The Supreme Court ruled this is a mandatory consumer protection measure.
- A temporary COVID-era fee allowance implied a general prohibition.
- The ruling mandates full refunds for canceled flights.
- A travel agency was ordered to repay deducted fees and costs.
Israel's Supreme Court has ruled for the first time that travel agencies are prohibited from charging service fees when assisting passengers in obtaining refunds for canceled flights. Justice Gila Kenaf-Steinholtz stated that this ruling is particularly significant given the frequent flight cancellations, often for security reasons.
The case involved Doron Ben-Shimon, who purchased a flight ticket for 1,087 shekels from Wizz Air through the travel agency Issta. After Wizz Air canceled the flight, Issta refunded Ben-Shimon only 911 shekels, retaining the difference as a handling fee. Ben-Shimon's claim for the refund of the difference was initially rejected by the Small Claims Court and the Tel Aviv District Court.
However, Justice Kenaf-Steinholtz agreed to hear the case in a rare third appeal and overturned the lower courts' decisions. She noted that lower courts had reached conflicting conclusions on the issue of travel agencies charging fees for processing refunds. The Supreme Court's decision establishes a precedent, stating that the Aviation Services Law mandates the refund of the full ticket price, including all fees and taxes, within 21 days of a passenger's written request.
Justice Kenaf-Steinholtz reasoned that a temporary regulation enacted during the COVID-19 pandemic, which permitted travel agencies to charge fees, implied that such charges were otherwise prohibited. She argued that if charging fees were generally allowed, there would have been no need for a specific, time-limited regulation. The purpose of the Aviation Services Law is to protect consumers and ensure they receive their money back, not to allow agencies to deduct additional fees for a service that is part of their standard customer support.
Issta was ordered to refund the deducted handling fees to Ben-Shimon, with interest and linkage, and to pay 5,000 shekels in legal expenses. Justices Yael Vilner and Daphna Barak-Erez concurred with the ruling. Barak-Erez added that travel agencies can factor the potential need to assist with refunds into their initial pricing.
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