The International Air Transport Association (IATA) has expressed strong disapproval of the Spanish government’s decision to disregard European law by eliminating cabin baggage fees for passengers in Spain and imposing a fine of EUR 179 million on airlines. This action threatens the principle of pricing freedom, which is essential for consumer choice and competition, a tenet consistently supported by the European Court of Justice.
“This is an appalling decision. Far from protecting the consumer interest, this is a slap in the face of travelers who want choice. Prohibiting all airlines from charging for cabin bags means that the cost will be automatically priced into all tickets. What’s next? Forcing all hotel guests to pay for breakfast? Or charging everyone to pay for the coat-check when they buy a concert ticket? EU Law protects pricing freedom for good reason. And airlines offer a range of service models from all-inclusive to basic transport. This move by the Spanish government is unlawful and must be stopped,” said Willie Walsh, IATA’s Director General.
Consumers seek both choice and value for their expenditures. This proposed legislation would eliminate both aspects. Recent independent polling conducted by IATA among recent air travelers in Spain revealed that 97% expressed satisfaction with their most recent journey and highlighted the following preferences:
– 65% indicated a preference for securing the lowest possible fare for their air ticket, opting to pay additional fees for any necessary services.
– 66% concurred that there is generally adequate transparency regarding the fees imposed by airlines for various travel options.
– 78% affirmed that air travel offers good value for money.
– 74% reported feeling well-informed about the products and services they purchase from airlines.
These results are consistent with the most recent Eurobarometer survey conducted by the European Commission, which found that 89% of travelers across Europe felt well-informed about luggage allowances.
The presence of various business models—from full-service to ultra-low-cost airlines—reflects market demand, indicating that regulatory intervention in this area is unnecessary. Furthermore, ancillary revenue is crucial for the low-cost carrier business model, which has contributed to lowering prices and increasing access to air travel for lower-income demographics.
Spain has a history of attempting misguided regulatory actions and imposing fines. In 2010, the Spanish government sought to enforce similar penalties and restrictions on airlines under Article 97 of Spanish Law 48/1960, a statute established during Spain’s fascist dictatorship. This initiative was invalidated by the EU Court of Justice, which cited an EU regulation that safeguards pricing freedom (Article 22 of Regulation No 1008/2008).
Following the failure of this initial effort, the current initiative once again seeks to undermine pricing freedom by prioritizing another Spanish law (Article 47 of Spain’s General Law for the Defense of Consumers and Users) that contradicts the principles of pricing freedom firmly established in European law.
“They failed once, and they will fail again. Consumers deserve better than this retrograde step which ignores the realities of today’s travelers. Spain’s tourism industry has grown to account for nearly 13% of the country’s GDP, with 80% of travelers arriving by air, and many of them budget conscious. Cheap air fares have played a huge role in growing this sector of the economy. The government has no competence—legal or practical—in eliminating the availability of basic airfares. The ECJ concluded this a decade ago. The EC needs to urgently step up and defend its laws which deliver benefits to consumers by protecting pricing freedom,” said Walsh.
The transportation of cabin baggage incurs associated costs, primarily manifested in extended boarding durations due to the time required for passengers to stow their luggage. The efficient utilization of aircraft is a critical factor in determining airline profitability, especially in short-haul operations. An increase of 10 to 15 minutes on the ground for boarding each flight significantly diminishes the number of flights and the operational capacity of the aircraft on a daily basis.
“Everyone paying more for less choice is the worst possible outcome that a regulation could deliver,” said Walsh.