Airlines appeal CAB rulings on overbooking, refunds

The country’s budget carriers have asked the Civil Aeronautics Board (CAB) to reverse its recent move to tighten rules on overbooking of flights and ticket refunds, claiming that such restrictions would lead to higher fares for consumers.

In a motion for reconsideration filed last week, Air Asia Inc., the local unit of Malaysia’s Air Asia Berhad, called CAB resolutions’ 28 and 29 “discriminatory” since it only applied to local airlines, which competed with foreign carriers that enjoyed more relaxed rules.

Resolution 28 banned the industry practice of overbooking, or the practice of selling more tickets than there are seats. Resolution 29, meanwhile, mandated airlines to refund all passengers who are not able to take their scheduled flights, regardless of the reason.

The rules were passed following rising complaints from passengers, alleging that airlines have been “abusive” in their treatment of passengers affected by overbooking.

“The CAB resolution violates Air Asia’s right to equal protection under the law since it is made applicable only to domestic air carriers and exempts compliance by foreign airlines,” Air Asia said in its 11-page resolution.

“All natural and juridical persons similarly situated should be treated alike both as to rights and responsibilities. There is no substantial distinction between domestic air carriers and foreign carriers to warrant different treatment,” the company said.

Aside from being discriminatory, Air Asia said the new rules would force budget carriers to abandon cost-cutting practices that have allowed the industry to offer lower fares to passengers.