TWELFTH MEETING OF THE AFCAC AIR TRANSPORT COMMITTEE (Dakar, Senegal, 30-31October 2012) Air Transport AFRICAN AIR TRANSPORT AND THE PROTECTON OF THE CONSUMER (Presented by AFCAC) SUMMARY This paper addresses the need for a a consumer protection regime at national regional and continental levels and advances the draft study in an ongoing study as the way forward. INTRODUCTION 1. The vast majority of consumers of African air transport services have not had the opportunity of being protected by any institution against poor service delivery and are mostly unaware of any rights they may have against the various service providers who are dealing directly with them. 2. On the few occasions where, being aware of their rights, they make any attempt at enforcing those rights, they are often confronted with institutional incapacity. 3. Some African countries have consumer protection rules that are also utilised to regulate the protection of rights of air transport consumers. Examples are Botswana, South Africa and Egypt. A few countries like Nigeria have a well developed aviation consumer protection regulation and a department of the Civil Aviation Authority handling consumer protection issues. 4. By and large, the vast majority of African countries do not have any general consumer protection regulations nor a specialised set of rules dealing with air transport passenger rights. 5. The Warsaw/Montreal regime remains for the largest number of African air transport consumers the only means of obtaining some form of protection and redress against airlines. 6. Article 9.6 of the Yamoussoukro Decision requires that the Executing Agency ensures that consumer rights are protected. For the African air transport consumer this provision is perhaps the single most important provision recognising (a) the challenges faced by a large number of consumers (b) the need to provide for some form of regulation that will improve service quality and enjoin service providers to attend to the interests of their consumers. 7. The ongoing on the operationalisation of the Executing Agency was required to and has indeed provided for consumer rights rules. 8. The rules were drafted with three objectives in mind. 9. A state that has no consumer protection regulation should be able to adapt the draft rules and apply it its domestic setting. Naturally the process of adapting the rules will require some extensive work depending on the local legal structure. 10. The second target was the regional YD Authorities. The rules can also be modified to suit their setting and implementing as a region-wide consumer protection regulation.
11. Finally and perhaps most directly it is meant to be implemented, when approved by the Conference of African Ministers in charge of Air Transport and adopted by the Executive Committee of Ministers of the African Union, by the Executing Agency as the continental regulations. 1. COMSUMER RIGHTS 1. Consumer Rights regulations are designed to ensure that services rendered to consumers is fit for purpose. It ensures that the suppliers are regulated to ensure continuity of service, quality of service delivery, complaints handling and most importantly, refunds and compensation schemes for consumers. 2. Key principles of Consumer Protection are: a. The right to satisfaction of basic needs b. The right to safety c. The right to be informed d. The right to choose e. The right to be heard f. The right to redress g. The right to consumer education and h. The right to healthy environment. 3. Most developed countries have developed corpus of legal instruments and institutional arrangements applying general consumer protection rules to their citizens and expanding the corpus of law to specialised areas of economic delivery. 2. AVIATION SERVICE PROVIDERS AND CONSUMER PROTECTION 1. Civil aviation has developed a considerable corpus of regulations to guide the operations of service providers and guarantee that consumer rights are protected. While some states may have a single document, others have applied the basic principles in different regulations. 2. Essentially who should be the objects of consumer protection rules? Service providers in the industry that are recognised as dealing directly with consumers either in the sphere of passengers or in dealing with their cargo may include airlines, air travel agents, ground and cargo handling agents, and airports. While a lot other service providers have impact on the the type of service delivered to the air transport consumer, the average consumer has no direct dealings with these. Rather the service providers with whom the passenger deals with are the ones who have contracted for those services. These are on average commercial contracts and remain third party relations as far as the consumer is concerned. Thus under normal circumstances, consumer protection law does not apply to those. Invariably though, by dint of product liability law, the poor delivery of services that directly impact on consumers will require that consumers are also protected against the negative impact of these commercial contracts. 3. This level of protection remains a civil law protection and is not often regulated. An attempt has been made to extend consumer protection rules to also cover these situations where air navigation services providers, air traffic controllers, fuel service companies, etc deliver poor services or fail to deliver at all as a result of which a large number of consumers suffer. It is however proposed that aggrieved group of consumers intent on seeking redress join the contractual party who has directly suffered losses. 4. Indeed some states may rather see it as an important step, given the near-utility nature of the service performed by the indirect service providers to rather impose public service obligations
and penalties when their quality of service results in mass consumer suffering. The question will be the extent to which a regional YD Authority may be able to impose a penalty on an air navigation service provider for instance where the failure of such a provider could have occasioned a chain of delays within the sub-region. 3. KEY PRINCIPLES OF AVIATION CONSUMER PROTECTION 1. The draft Consumer Protection Regulations seeks to answer some of the following questions: a. How can the consumer be protected against insolvent airlines, travel agents and tour operators who have collected and hold monies belonging to the consumers prior to insolvency? b. How can stranded passengers be repatriated to their airport of departure when due to insolvency or administrative measure their airline of choice s not able to complete the contract of carriage? c. What measures are required to prevent deceptive marketing practices resulting in a passenger being landed on a flight of a carrier it has no intention of flying or advertising inexistent products? d. Is the persistent application of free seating a usual business practice or an unfair charging of some passengers and a distortion of competition? e. Is there a need to require service providers to undertake to properly communicate with the consumer before, and after checking-in and especially when the consumer has started his or her journey? Can this obligation to communicate be considered an enhanced obligation on African air carriers and agents, particularly at each of the stations the airlines in question operate? f. What rights to compensation, refund and cancellation do passengers have in cases where delay, cancellations and overbooking occur? 2. These and more issues are dealt with in draft regales on African air transport consumer protection. A summary list of issues are discussed below. 4. INSOLVENCY 1. How can one reduce harsh effect of insolvency on the passengers who are either stranded and or lose out on tickets paid for to insolvent travel agents, tour operators and airlines? 2. A number of airlines fail financially or are forced due possibly to administrative procedures to suspend flights. Air Nigeria is a typical case of the second instance where the airline apparently had their operating certificate suspended. The result of this is that a large number of passengers who would have paid their monies to the airlines in various countries end up losing their monies either because the airlines offices closes down immediately or where open it fails to refund their monies. Additionally, passengers who would have started their flights are unable to do the return leg, and are unable to obtain any information from the airline.
3. There appears to be no scheme where the Civil Aviation authorities of African countries have any transparent information management to alert passengers of impending challenges and to advise them of how to obtain refunds etc. 4. Provisions have been introduced in the draft Consumer Protection Regulations to enable the Executing Agency and the regional YD Authorities and national authorities raise questions at the time of licensing of the carrier and certificating the eligible airline and of other airlines and ensure financial stability; regulating how to secure passenger monies; establishing a fund to ensure that passenger monies are not taken by irresponsible service providers and where taken can either be refunded in times of need or that passengers can be repatriated to their intended destination. 5. UNFAIR AND DECEPTIVE PRACTICES 1. What measures to impose on service providers to ensure fair pricing, fair communication, decent marketing practices? 2. One side of competition regime is to ensure that airlines compete in a decent fashion among themselves. Competition law operates to prevent abuse of dominance, collusion by airlines to introduce unfair pricing etc. The other side of those is the utilisation of consumer protection law to prevent an airline from implementing measures that may not be offensive to competition regulation but end up having a negative impact on consumers. 3. Measures introduced in various jurisdictions to curtail and proposed here include the elimination of misleading advertisement and the disclosure of the whole fact about the travel a passenger s paying for. Additionally, given the rampant nature of its implementation in Africa, the practice of free seating has been questioned in the draft regulations and raised as a practice that is not only unfair but may also lead to deception and needs to be punished. Other measures include persistent boarding denials; unfair application of Warsaw/Montreal regime; failure to maintain adequate insurance; and chronically delayed flights. 6. ADDITIONAL OBLIGATIONS The draft regulation provide general obligations on insurance, non-discrimination, maintaining a contact point for passengers and tourists; information to the consumer; complaints procedure, filing of advanced flight and passenger information; compliance with Warsaw Liability regimes; denied boarding; delay; cancellation of flight; downgrading particularly in consequence to free seating policy; and specific obligations on air travel agents, tour operators and airports. 7. RIGHTS OF THE CONSUMER 1. The duties outlined in the previous paragraph also have complementary rights of the passengers
including reimbursement, cancellation, re-routing, and compensation. It must be observed that the African air transport consumer has the right to cancel his booking, can seek reimbursement or be re-routed and at all materials moment has a right to be compensated for delays, overbookings and cancelled flights. 2. The consumer also have a right to have his complaints dealt with and Civil Aviation Authorities should consider it an obligation to introduce measures at the airports to obtain complaints and handle those complaints as appropriate. 8. DUTY OF CARE OF THIRD PARTIES Exceptional provisions have been included in the draft to ensure that service providers upon whose service others rely who are in direct relationship with the consumer provide and though whose reckless or negligent action the airline fails to provide its services contracted for may be, subject to national legislation, be subjected to legal suit in tort for general breach of duty to the consumers. Attendant right of recourse of service providers against others have been introduced as well. 9. ADMINISTRATIVE PROCEDURES Administrative procedures, including right to investigate, conduct hearings and impose penalties have been proposed to ensure compliance with the proposed draft regulation. 10. ACTION REQUIRED The Committee is invited to: a. Note the content of this working paper b. Obtain a copy of the draft Consumer Protection Rules c. Consider the need of adopting national, regional and continental regulations d. Modify as consider necessary and recommend AFCAC to complete the various studies needed to enhance the quality of the draft instruments.