The consumer watchdog hopes Qantas will be dealt a record fine for a consumer law breach if its allegations about the airline selling cancelled tickets prove correct.
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Australian Competition and Consumer Commission chair Gina Cass-Gottlieb would like to see the airline pay more than double the existing $125 million record penalty slapped on Volkswagen back in 2019.
The ACCC has launched Federal Court action claiming the troubled airline engaged in false, misleading or deceptive conduct after continuing to sell thousands of tickets for flights that were already cancelled.
The watchdog is seeking penalties, injunctions, declarations and costs.
Ms Cass-Gottlieb said penalties for failing consumers were generally too low and the watchdog would be seeking a fine that would deter future offences.
"We are going to seek a penalty that will underline that this is not just to be a cost of doing business," she told ABC radio on Friday.
If the case against Qantas succeeds, she would be hoping for twice the existing penalty record for a consumer law breach - amounting to a $250 million fine.
The case brought forward by the ACCC follows a tough week for Australia's national carrier, with Qantas boss Alan Joyce forced to fend off a range of criticisms at a parliamentary hearing.
He faced questions over the airline's record $2.5 billion profit, high ticket prices, as well as the issue of millions of dollars in outstanding flight credits that will go straight to its bottom line if left unclaimed.
In response to public backlash, the airline has since moved to scrap the expiration dates on its unredeemed flight credits.
Qantas' role in the federal government's decision to block Qatar Airways from flying extra routes has also come under heavy scrutiny, with the Australian airline understood to have lobbied against the additional flights.
Labor national president and former federal treasurer Wayne Swan said it would be appropriate for the government to review the decision.
Opposition senators will next week seek to force the government to reveal the advice given to Transport Minister Catherine King in making her decision on Qatar Airways.
"We should understand that there is a full analysis in terms of economic modelling and other factors and implications there," Liberal frontbencher Simon Birmingham said.
Opposition Leader Peter Dutton said the Qatar decision would force up prices.
"The fact is that Qatar was excluded from participating, that means that because of the decision the prime minister's made, every time you book to go and see your family member in Europe or in Asia or America, you're paying literally thousands of dollars more for the ticket than you would otherwise need to," Mr Dutton told Nine.
Deputy Prime Minister Richard Marles said improving competition was at the heart of the upcoming aviation white paper, due in the first half of 2024, and the government's broader approach.
"Every airline needs to lift their game and make sure that they are engaging in the best possible service for their customers, and that very much includes Qantas," he said.
Australian Associated Press
