Spanish Government Imposes Hefty Fines on Budget Airlines Over Baggage and Seating Fees

In a significant move that could reshape the business model of budget airlines, the Spanish Ministry of Consumer Rights has imposed substantial fines on several low-cost carriers for what it deems as "abusive practices" related to baggage fees and seating arrangements.

The Fines

On November 22, 2024, the ministry announced fines totaling €179 million against five budget airlines. The largest fine, €107.78 million, was levied against Irish airline Ryanair, followed by Spanish carrier Vueling with €39.2 million, EasyJet with €29 million, and Scandinavian airline Norwegian and Spanish carrier Volotea with fines of over €1 million each.

Reasons for the Fines

The fines were imposed due to several practices deemed unfair by the ministry. These include charging extra fees for larger pieces of cabin luggage, reserving seats near dependent travelers, and imposing "disproportionate and abusive" fees for printing boarding passes. The ministry also criticized the airlines for not allowing cash payments at Spanish airports and for not providing clear pricing information on their websites.

Industry Reaction

The airlines and industry groups have vehemently opposed the fines. Ryanair CEO Michael O’Leary described the fines as "unlawful and baseless," arguing that they violate EU law and were imposed for "political reasons." O’Leary referenced an "ancient 1960s law" that he believes predates Spain's membership in the EU and is therefore inapplicable.

Javier Gandara, President of Spain’s Association of Airlines (ALA), also expressed strong opposition, stating that the fines would cause "irreparable damage" to passengers and undermine their freedom to customize their travel according to their needs. Gandara emphasized that the airlines would appeal the decision in court, citing the potential for "competitive distortion" since Spain is the only EU country imposing such restrictions.

Legal Challenges

The affected airlines have confirmed their intention to appeal the fines. Ryanair has already instructed its lawyers to file an immediate appeal, arguing that their luggage policies have been approved in multiple court hearings in Spain and the EU. The ALA has also reaffirmed its support for the airlines, stating that the decision is "manifestly illegal, inexplicable, and could seriously and irreversibly harm many passengers."

Impact on Passengers

The ministry's decision could significantly impact the way budget airlines operate in Spain. If upheld, the airlines would no longer be able to charge for carry-on baggage or for reserving adjacent seats for minors and dependents. They would also be required to accept cash payments at airports and refrain from imposing excessive fees for printing boarding passes.

For passengers, this could mean a change in the cost structure of their flights, potentially leading to higher base ticket prices if the airlines are no longer able to generate revenue from these additional fees.

Broader Context

This move by the Spanish government is part of a broader trend of increased regulatory scrutiny over consumer practices. It follows other recent measures, such as the new law requiring tourists to provide extensive personal data to improve security, which came into effect on December 2, 2024. This law mandates hotels, holiday rentals, and car rental companies to collect and report a wide range of personal data, including home addresses, phone numbers, and payment details, to central authorities.

As the legal battle unfolds, expats and travelers in Spain will be watching closely to see how these changes affect their travel experiences and the overall cost of flying with budget airlines.