New airline fee structures

• 

  djsweet on 01/09/2016 - 09:02

  When you buy from AirAsia or Scoot you are not buying from an Australian company. However, I believe the ACL is supposed to apply to all companies selling into Australia. Nevertheless it is impossible for the ACCC to impose its regulations on an international company.

  • 

    burningrage on 01/09/2016 - 09:08

    Scoot imposes a fixed AUD$10 per person per flight (or AUD$20 per return per person) credit card fee.

    The problem is under the Dynamic Currency Conversion (or otherwise known as International Transaction Fee), they charge you in AUD but processed the payment in Singapore (as they are a subs of SQ).

    That triggers DCC of around 4%. So be careful the total fee is AUD$20 per person PLUS DCC of 4% of the ticket fee.

    Might worth discussing with ACCC.

  • 

    SirFlibbled on 01/09/2016 - 12:24

    +1

    The ACL does apply to OS businesses trading in Australia. The ACCC have forced AirAsia in the past to include all taxes in their fares for flights out of Australia so it's possible.

    The AU government does, at least, have the ability to hold their CASA approval hostage to complying with all relevant Australian laws for flights to and from Australia if they chose to do that.

• 

  burningrage on 01/09/2016 - 09:15

  +1

  Note for Jetstar 3K flights (which are Jetstar Asia), the impost is $8.50 per flight per passenger.

  A trip from Singapore to Jakarta (one way) for example, cost about $44 which means the final cost is $52.50. $8.50 is about 20% surcharge of $44.

  That's clearly outside the spirit of what RBA is trying to do.

  So consistent with DJSweet, it would appear the ACCC laws only affect domestic entities.

  • 

    zappy32 on 01/09/2016 - 20:41

    I don't think the RBA think they can regulate an overseas airline one a flight departing and arriving outside of Australia. 3K is registered in Singapore, holds an AOC in Singapore and is only 49% owned by an Australian company(Qantas). It's up to the Singaporean government to regulate that and they tread pretty lightly with financial regulation so I doubt it will happen any time soon.

    • 

      burningrage on 02/09/2016 - 10:59

      I wonder if you then buy the tickets through travel agent (and the ticket includes the 3K Leg), how would they go about it?

      • 

        zappy32 on 02/09/2016 - 16:52

        Departing Australia? Shouldn't be included.

        Not departing Australia I don't know a travel agent that already adds an appropriate margin to low cost airfares that would cover it.

• 

  burningrage on 01/09/2016 - 09:33

  +1

  This guideline would be useful…

  https://www.accc.gov.au/consumers/prices-surcharges-receipts…

  In it, it doesn't say why flights such as 3K flights should be exempted from ban but…

  https://www.finder.com.au/jetstars-new-credit-card-surcharge…

  this one says it doesn't cover 3k Flights…

  • 

    peterpeterpumpkin on 01/09/2016 - 09:55

    Yeah I wonder if departing Australia means you come under Australian consumer laws? Jetstar Asia as Newstar investments is based in Singapore, but if the flight leaves Australia first they charge Australian fees. The problem is Jetstar can simply charge more for the return leg.

    The ideal situation is that all fares are fee-free since all payment methods cost the airline something in reality. They're being difficult for the sake of being difficult ala Ryanair.

    • 

      burningrage on 01/09/2016 - 10:13

      +1

      That's a question someone should probably ask ACCC.

      The guidelines clearly don't provide exemptions.

      As a proof, Cathay Pacific isn't Australian entities but it is affected too.

      https://www.finder.com.au/cathay-pacific-sets-new-credit-car…

      • 

        peterpeterpumpkin on 01/09/2016 - 10:39

        Thanks. Gives me the courage to complain.

        In this case it's the budget airlines that are screwing us over the most, since a promo $199 one-way fare SYD-SIN one-way with Scoot has a fee of $20 or 10%.

        AirAsia does offer fee-free options with Paypal and POLi but they don't come under the new regulations anyway. If they get in trouble under the new regulations they may start charging for Paypal.

    • 

      SirFlibbled on 01/09/2016 - 12:28

      +1

      The short answer is yes. The flight departing Australia comes within the ACL.

• 

  inherentchoice on 01/09/2016 - 09:36

  So it looks like anyone wanting to avoid the fees will need to maintain an account with one of the POLi banks. I might have to keep my ING account going.

  But I wonder if fares will now creep up to compensate for any lost revenue?

  Hopefully Jetstar doesn't introduce credit card fees for a price beat fare.

  • 

    peterpeterpumpkin on 01/09/2016 - 12:17

    Yeah. Luckily Citibank recently introduced POLi else I would have been screwed. It's a shame that Citibank has such a non-rewarding tied-savings scheme but I need the card for international travel and purchases so I like to keep it preferentially loaded compared to ING. When instant bank transfers arrive things could become less frustrating. I don't really have a use for MEBank anymore (unless I move savings there).

    It's funny how fares "should" creep up to maintain profits but I wonder if we'll notice it as much at the "sale fares" since that's how the airline duopoly competes. They can still sacrifice 100 promo seats for the same ol' OzBargainers. I'm quite disappointed that Qantas/Jetstar, being an Australian company, would stoop so low for so long when they really only had 1 realistic competitor (Virgin/Tiger) in the advertising space for domestic flights.

• 

  burningrage on 01/09/2016 - 09:45

  +1

  Just to add.

  Emirates charges 1.5% for flights originating Australia/NZ but appears to have been added since July 2016 and so didn't change as the result of this reform.

  http://www.ausbt.com.au/emirates-launches-new-credit-card-su…

  http://www.emirates.com/au/english/help/faq/2519611/how-much…

  As a comparison, flights departing from UK costs GBP5 while if departing from German, EUR7. 1.5% is still too high!!!!

• 

  tooblue on 01/09/2016 - 12:13

  Isn't using POLi a breach of banks' T&Cs as it is sharing login details with a third party.

  • 

    peterpeterpumpkin on 01/09/2016 - 13:51

    Yes, at least with the Commonwealth Bank and possibly all. I'd like to see a court case (but not with my money :)). The RBA should be made to validate a POLi-like system with the upcoming changes to bank transfers. With instant payments the reliance on legacy payment monopolies "should" be reduced within Australia.

  • 

    kiitos on 03/09/2016 - 10:18

    Why is that? How does it differ from other forms of payment?

    • 

      peterpeterpumpkin on 03/09/2016 - 15:00

      They're ASIC exempt and normally have no agreement whatsoever with any of the banks. We're literally letting a third-party hijack our on-line banking interface and only have as much security as when selecting "Pay Anyone" in the same interface.

      This means that if POLi is compromised or buggy and something crap happens the banks say you broke the terms of use. The government should regulate it considering how common it is (e.g. AusPost allows it) so then banks can be forced to provide an API for future services when instant transfers become a reality.