Ryanair loses 'handling charges' case

A German court ruling challenges the airline's high fees for paying by debit or credit card. Oliver Smith reports.

Ryanair loses 'handling charges' case
A court case in Germany could change the way Ryanair charges its customers for paying with credit and debit cards Credit: Photo: EPA

Ryanair's practice of charging passengers extra for using credit and debit cards could be challenged following a court ruling in Germany.

Telegraph Travel learnt this week that the no-frills airline lost a court case in Germany last month over the "handling charges" it imposes on customers booking online.

The case, which has not been reported in Britain, came about following a complaint by the Federation of German Consumer Organisations over the imposition of an €8 (£7) charge per person per return flight when payment is made by credit or debit card. In Britain the charge is £10 per person per return flight.

Berlin's Superior Court of Justice, citing a European Union directive, deemed that the charge was "inadmissible" unless the airline also offered a charge-free method of payment.

Ryanair says that passengers can pay without incurring the extra charge by using Visa Electron cards. The airline described the Berlin court ruling as "crazy" and said it would appeal.

But the ruling could encourage legal action elsewhere. Kirsten Huppe, a legal policy officer at the Federation of German Consumer Organisations, said it was "a sign for other courts that the issue should be reconsidered".

Earlier this year Ryanair was referred by the Advertising Standards Authority (ASA) to the Office of Fair Trading (OFT) over the airline's "unwillingness and apparent inability to comply with rules on misleading advertising over the past two years".

The airline has been the subject of 15 ASA adjudications since December 2004, while six further complaints have been resolved informally. Ryanair was condemned as "irresponsible" in January for using a photograph of a model dressed as a schoolgirl to advertise its "hottest" fares.

This week, following talks with OFT officials, Ryanair made several changes to its website, giving more prominence to information about the airline's "optional" charges, which are not included in its headline fares.

The Dublin-based carrier currently charges £30 to check in one item of luggage, £10 per person to pay for a return flight using a debit or credit card, £60 to travel with sport or music equipment and £15 per kilo for excess baggage.

Additional charges and booking fees are expected to earn the airline at least £650 million this year.

"There is no transparency with these credit card charges," said Bob Atkinson, spokesman for Travelsupermarket.com, the price comparison website. "Airlines – not only Ryanair – must be profiteering. If not, they should clarify where the money is going."

Mr Atkinson welcomed the changes made this week to Ryanair's website but said more needed to be done.

Simon Evans, chief executive of the Air Transport Users Council, questioned whether using Visa Electron was really a viable alternative, even though the airline claims that nearly a third of flights are purchased using the card.

"Budget airlines' extra charges have been an issue for some time," said Mr Evans. "It will be interesting to see whether this court case has an impact on Ryanair's practices in the UK."