The International Air Transport Association (IATA) has condemned the Spanish government’s decision to override European legislation, abolish hand luggage fees for passengers in Spain, and fine low-cost airlines Ryanair, easyJet, Vueling, Norwegian, and Volotea a total of 179 million euros.
According to IATA, this measure “undermines pricing freedom, which is fundamental for consumer choice and competition, a principle long upheld by the European Court of Justice.” “This is an appalling decision. Far from protecting consumer interests, it’s a slap in the face to travelers who want choice. Prohibiting all airlines from charging for hand luggage means that the cost will automatically be included in all tickets. What’s next? Forcing all hotel guests to pay for breakfast? Or making everyone pay for coat check when buying a concert ticket? European law protects pricing freedom for good reason. And airlines offer a range of service models from all-inclusive to basic transport. This move by the Spanish government is illegal and must be stopped,” said Willie Walsh, IATA’s Director General.
Consumers want choice and value for money. This law would remove both. A recent independent poll commissioned by IATA from Savanta* among air travelers residing in Spain indicated that 97% were satisfied with their last trip and confirmed the following preferences:
- 65% prefer to pay the lowest possible price for their airline ticket and pay extra for any additional services needed.
- 66% agreed that generally, there is sufficient transparency on fees charged by airlines for various travel options.
- 78% stated that air travel offers good value for money.
- 74% said they feel well-informed about the products/services they buy from airlines.
According to IATA, these findings “align” with the latest Eurobarometer survey by the European Commission, where 89% of European travelers said they were well-informed about their luggage allowances.
“The existence of different models – from full-service to ultra-low-cost – is a response to market demand and regulation is not needed in this area. Moreover, ancillary revenue is crucial for the low-cost carrier business model, which has helped lower prices and expand access to air travel for lower-income groups,” argues IATA, noting that this is not the first time Spain has attempted such “misguided regulatory actions and fines.” In 2010, the Spanish government tried to impose similar fines and restrictions on airlines based on Article 97 of Spanish Law 48/1960, a law enacted during Spain’s fascist dictatorship. This was struck down by the European Court of Justice based on an EU regulation protecting pricing freedom (Article 22 of Regulation No 1008/2008). “After failing in its first attempt, this latest effort once again tries to subvert pricing freedom by prioritizing another Spanish law (Article 47 of Spain’s General Law for the Defense of Consumers and Users), in conflict with the pricing freedom principles clearly enshrined in European law.”
“They failed once, and they will fail again. Consumers deserve better than this backward step which ignores the realities of today’s travelers. Spain’s tourism industry now accounts for nearly 13% of the country’s GDP, with 80% of travelers arriving by air, many of whom are budget-conscious. Low-cost airfares have played a major role in the growth of this sector of the economy. The government has no legal or practical competence to eliminate the availability of basic airfares. The European Court of Justice concluded this a decade ago. The European Commission must urgently step up and defend its laws which deliver benefits to consumers by protecting pricing freedom,” said Walsh.
He further highlighted that carrying hand luggage does have associated costs, primarily in the form of extended boarding times due to the time it takes for passengers to stow their bags. Aircraft utilization is a key factor in airline profitability, especially on short-haul flights. Adding an extra 10 to 15 minutes on the ground for boarding on each flight significantly reduces the number of flights and the operational capacity of aircraft daily. “Everyone paying more for less choice is the worst possible outcome that regulation could deliver,” Walsh concluded.
