A case in which an airline ticket agency illegally “earned the price difference,” and the court ruled that it should refund the losses.

Keywords: Airline ticket agent; earning price differences through violations; verifying the authenticity of airline tickets; refunding price differences for cancelled tickets

Counseling Attorney: Li Fangzhi

Basic Facts of the Case:

In 2023, during an internal audit, the plaintiff company discovered that the refund fees paid by its branch offices when canceling airline tickets were actually higher than the ticket prices themselves. Consequently, the company began a thorough review and audit of all flight reservation records maintained by its branches.

The transaction details regarding the purchase of airline tickets between the plaintiff and the defendant are as follows:

1. The two parties have never entered into any service agreement regarding the booking of airline tickets.
2. The ticket purchase process is as follows: The plaintiff’s staff will send the passenger information to the defendant, who will issue the ticket for the plaintiff. After issuing the ticket, the defendant will request payment from the plaintiff via the “Air Transport Electronic Ticket Itinerary” (hereinafter referred to as the “Itinerary”). The plaintiff will then make payment according to the amount requested by the defendant. If the plaintiff is unable to travel in accordance with the submitted passenger information or misses the flight, the defendant will request payment of the ticket refund fee from the plaintiff via a “Refund Form.”
3. The documents upon which the defendant’s claim is based are: the “Itinerary,” the “Refund Form,” and the “Detailed Statement of Claim Expenses.”
4. After receiving the payment, the defendant issues invoices to the plaintiff at irregular intervals.
5. The “Detailed Statement of Claimed Expenses” lists the composition of expenses under the total claimed amount as follows: airfare + agency fee + refund/change/cancellation fees. However, it does not specify the exact proportions or fee standards for the actual airfare, refund/change/cancellation handling fees, or booking fees.
6. In response, the plaintiff’s lawyer assisted the plaintiff in verifying the authenticity through the itinerary verification website published by the civil aviation administration. http://www.travelsky.com.cn An online verification of the “airline tickets” (i.e., the Itinerary) provided by the defendant revealed that all amounts indicated on the “airline tickets” were forged. Furthermore, the “Refund Form” provided by the defendant was also self-prepared by the defendant and could not serve as proof that the airline had actually collected the corresponding fees. After carefully reviewing and verifying each piece of evidence one by one, we ultimately confirmed that the defendant had overcharged the plaintiff for both the airfare and the refund/change/cancellation fees.
7. In light of the above-mentioned facts, the plaintiff decided first to send a letter to the defendant to negotiate the refund of the overcharged fees. When negotiations failed, the plaintiff filed a lawsuit in court, and ultimately the court ruled in full favor of the plaintiff’s claim.

Case Highlights:

[Regarding Jurisdiction]

First, regarding the air-ticket agency services in this case, there was no contractual agreement between the parties. From the perspective of favoring the party involved, it would be more convenient to file a lawsuit in the jurisdiction where the tortious result occurred—in other words, the plaintiff’s location. However, in judicial practice, matters reviewed under tort liability primarily focus on compensation for personal injury. Whether compensation for property damage can also be reviewed under tort liability remains controversial.

[Discrepancies Between Market Trading Practices and Legal Regulations]

Since the airfare shown on the Itinerary is entered by the travel agency itself, it is considered “normal practice” under the current transaction habits of most airfare agencies in the market to add a “service fee” or “agency fee” to the price listed on the Itinerary.

However, a careful review of China’s relevant laws and regulations as well as the normative documents issued by the competent authorities reveals that air-ticket agencies should collect agency fees in accordance with the provisions of the air transportation sales agency contracts they have signed with air transport enterprises (i.e., individual airlines). It is clear that these agency fees should be collected from the airlines themselves, rather than from the ticket purchasers. Moreover, agencies are not permitted to unilaterally charge ticket fees exceeding the publicly announced prices set by the airlines. Therefore, consumers have the right to demand a refund of this fee.

Typical significance:

Taking this case as an example, the ticket agent’s practice of “profiting from the price difference” by selling airline tickets constitutes infringement. According to China’s relevant laws and regulations as well as the normative documents issued by the competent authorities, agency companies are prohibited from charging passengers any service fees beyond the published ticket prices. Therefore, the agent’s unauthorized collection of ticket fees exceeding the publicly announced price is unlawful. As a result of the agent’s unauthorized price increase, the plaintiff company unknowingly overpaid for the air tickets, suffering damages. There exists a causal relationship between the defendant’s unauthorized price increase and the resulting damage—the plaintiff’s overpayment of fees. Hence, the defendant’s conduct constitutes infringement.

In this case, the amount of infringement damages shall be determined by subtracting the airfare shown on the verification voucher from the fees collected by the defendant—this difference represents the overcharged airfare. If the defendant cannot provide evidence that it paid cancellation and change fees to the airline, no such fees should have been charged in the first place, and any such fees already collected should be refunded.

Therefore, although it is a common business practice for ticket agencies to earn a profit margin by selling airline tickets—typically by obtaining lower wholesale prices from airlines and then selling them to consumers at higher retail prices, with the difference constituting the agency’s profit—such practices do not comply with relevant laws and regulations. Hence, when encountering such issues, we can resort to legal means to safeguard our rights and interests.

When confronted with opaque fees and unreasonable price differences from airline ticket agents, consumers should remain vigilant and take proactive measures. First, before purchasing a flight ticket, consumers should carefully read the airline’s official website or contact the airline directly to learn about the official prices of different flights. This way, consumers can gain a basic understanding of the true cost of tickets and avoid being misled by the inflated prices charged by agents.

Second, when purchasing airline tickets, consumers should ask the travel agency to provide a detailed breakdown of charges, including all possible additional fees. Transparent fee information helps consumers determine whether the travel agency is engaging in unreasonable price hikes. If consumers discover that the travel agency is hiding fees or making false claims—both of which constitute violations—they can file a complaint with the relevant regulatory authorities and provide supporting evidence.

Finally, consumers should also actively learn about relevant laws and regulations to enhance their awareness of self-protection. Familiarizing themselves with legal knowledge such as the Consumer Rights Protection Law and the Anti-Unfair Competition Law will help consumers take swift action when encountering problems and safeguard their legitimate rights and interests. When confronted with irregular practices by airline ticket agencies, consumers should remain vigilant, actively defend their rights, and obtain information through legal channels. They should choose reputable agencies or purchase tickets directly from airlines to ensure that their rights are not compromised. Only in this way can consumers enjoy convenient air travel while avoiding unnecessary financial losses.

Lawyer's Insights (Optional):

First, digitizing, tabulating, and graphing your own arguments can facilitate the analysis and explanation of the facts and evidence during the trial.

Second, conducting mock trials in collaboration with the team before filing a lawsuit can not only effectively identify and address gaps and shortcomings in preparation for the courtroom proceedings when responding to the opposing party’s claims, but also help anticipate the key points of contention that the court is likely to focus on.

In addition, prior to the commencement of the trial, you should prepare for the court relevant case precedents and analyses thereof, as well as pertinent laws, regulations, and rules and regulations related to your claims.

Finally, regardless of the size of the case’s subject matter, as the representing attorney, you should provide end-to-end support and assistance to maximize the protection of your client’s legitimate rights and interests. The early-stage evidence collection and preparatory work prior to filing the case will both influence the trial review process and the facts determined in the judgment; therefore, you should provide comprehensive assistance to your client throughout the entire litigation process until its conclusion.