Dozens lose thousands of dollars in cruise cancellation charges as refund row grows

Cruise passengers who booked holidays with APT and its sister brand, Travelmarvel say they are out of pocket thousands of dollars from “cancellation charges” and “unrecoverable third party costs”.

They have complained to the Australian Competition and Consumer Commission, which is currently investigating a number of travel operators who have refused to refund passengers in full for cancelled cruises.

The issue has sparked a furious debate, with Cruise Passenger’s website receiving tens of thousands of views and comments on its coverage.

“The ACCC is aware of cases of travel providers charging high cancellation fees, or retaining high amount from refunds provided as unrecoverable costs,” said an ACCC spokesperson when asked about the issue.

“Travel providers should act in accordance with the terms and conditions that were in place at the time a consumer made their booking. This means cancellation fees can only be charged, and amounts retained from refunds, if the supplier is legally entitled to do so under the terms and conditions of the booking.

“If travel providers misrepresent consumer rights under contract, including in relation to the amount of any cancellation fees they can charge, they may be engaging in conduct in breach of the Australian Consumer Law.”

Joanne Jackson, a Brisbane woman who was due to travel to Europe on a $37,000 trip with her mother and her sister, claims to have had  $9,200 withheld by Travelmarvel.

“The trip was supposed to be a trip for my mum, my sister and myself so we could spend some time together. We had booked European river cruise and paid just under $30,000 for the three of us,” said Ms Jackson.

“And with flights added on top of that, the total came to around $34,000. My mum, who is 77, paid for around $29,000 of the holiday, while I paid $5,000 so she footed most of the bill.”

Ms Jackson said Travelmarvel initially offered her and her family a cruise credit, but she was worried she might not be able to travel with her elderly mother.

Travelmarvel then offered them a refund – but less $9,200 which the company alleges is for unrecoverable third party costs.

“We were looking forward to this trip. It was going to be a holiday of a lifetime. We were five weeks out for travelling when Travelmarvel cancelled the holiday.

“When we requested a breakdown of what the money was being used for, we were just given an item on each invoice, saying it was for third party unrecoverable costs. It made me really sick at the thought that my mother is out of pocket so much money. And she wouldn’t be the only one.

“Since cruising appeals to so many elderly people, we are not the only ones in the same situation.”

A Victorian couple who had paid $13,000 for a European river cruise, only received an $8,000 cash refund, with APT citing that they were charged $5,000 for cancellation costs.

Another Gold Coast pensioner, who had booked an Amsterdam to Budapest river cruise with Travelmarvel, spent $17,000 on her holiday, which included flights. She too, was only offered $12,200 in refunds, leaving her $5,500 out of pocket.

Susan Smith said more than 30 per cent of the cost of her cruise was withheld on the basis of “irrecoverable costs’, but it has not been disclosed by Travelmarvel.

“Eventually they got back to us and said one part was ‘irrecoverable distribution costs’ and another part was ‘irrecoverable third-party supplier costs’. That is as far as they will tell us. We have no idea why we are paying their costs when we got nothing. We have no trip, nothing out it,” she told the Gold Coast Bulletin.

Ms Smith said she was “fair-minded” and understood there were costs the company could not absorb.

“What doesn’t seem fair is they keep a third of it in cancellation costs. That’s ludicrous.”

Barry and Liz Culph from Geelong were only offered an $8,000 cash refund from the total $13,000 paid.

“We’d at least want something more substantial than what was offered,” he said.

“There are people out there right now who are much worse off than we are. It’s also about the principle of the situation.”

The ACCC said: “If consumers are charged a cancellation fee, or have an amount to cover expenses retained from a refund provided to them, they should check the terms and conditions of their booking, and ask the travel provider to expressly identify the legal source of their right to the fee or amount to be retained; and provide an itemised breakdown justifying the amount charged or retained.”

Consumer advocate Adam Glezer, leader of the Facebook advocacy group Travel Industry Issues – The Need For Change for Australians, is calling on the government to regulate the industry to ensure that customers are not disadvantaged.

“It’s about time the government steps up and starts protecting customers. Why should the customer be faced with cancellation fees when they weren’t the ones to cancel the holiday? This one of many reasons why legislative change is a must.”

A spokesperson for APT said she could not discuss individual bookings,  but that all customers impacted by cancellations had been offered credit for the full value of the travel.

“This was available in 2022 and transferable to family or friends.  Those guest preferring a refund, the amount is less irrecoverable third party costs and overheads as outlined in our standard terms and conditions.

“In addition, we are also providing our Rebook with Confidence Cover, providing additional flexibility should they wish to rebook for a later date which is also over and above our usual terms and conditions. For those guests preferring a refund, the amount is less irrecoverable third party costs and overheads as outlined in our standard terms and conditions. This is also detailed on our website through our Travel Updates and booking policies as linked here.

“While we can appreciate the request for a breakdown of the irrecoverable costs, in these challenging times, the APT Travel Group is incurring numerous costs associated with cancellations. As we provide package holidays, we are unable to divulge individual contracts with our suppliers and therefore a detailed breakdown of costs.”