Sorry to re-hash, but I'd like to get it clear in my mind. Is this a simple explanation of how things went 'mechanically'?
* Example: In January 2020 I paid $1K for a Virgin flight to be taken in December
* In April 2020, VA went into voluntary administration. I became an unsecured creditor
* The administrator worked out that there wasn't enough to pay the creditors (especially the unsecured creditors), so put the entity up for sale
* Bain bought the entity in Nov 2020
* Bain had no obligation to honour the unsecured creditors (such as paid but unused airfares) but decided to honour them with 'future flight credits' which were redeemable with conditions up to a certain time. Approved by ACCC and ?courts?
* I could take $1K in flights, under the set conditions, up to 31 Dec 2023. Flights didn't have to be for myself.
Modifications :
* In April 2020, VA went into voluntary administration. You became an unsecured creditor
* The administrator worked out that there wasn't enough to fully pay the staff, secured creditors, unsecured creditors so they looked at avenues to save the business
* The administrator felt it was in the better interests for passengers who had tickets to have a Future Flight Credit so they could retain the full value. The FFC was designed to have limited seats on flights and an expiry date. This was built into the Deed of Company Agreement which is part of the sale of the business. (This FFC idea at the time was discussed on this forum with forum members expecting such FFC to be postivie on consumers.) FFC's could be used by anyone, they are linked to a person but during the booking process you can can enter the details of the taking the flight(s).
* Bain aquired the entity in Nov 2020 along with knowing Virgin Australia was going to inherit the FFC's. (Other purchaser's were also aware of this too in the instance they acquired the company.)
* Virgin Australia extended the credits (at least once, I think twice. I think the original expiry was 31st December
2021)
* The FFC's expired on 31 December 2023. (They were valid for over 3 years. This matches Australia's legal expiry of gift cards, 3 years minimum).
Yes, from the time the FFC was issued in
2020 you could have used the FFC amount ($1K) in Virgin Australia operated flights dollar for dollar / cent for cent, under the set conditions, up to 31 Dec 2023 and the person taking the flight didn't need to be you.
The conditions of the FFC were clear on Virgin Australia's website.
If you used an FFC it would have cost Virgin Australia money in airport fees, taxes (and potential lost revenue).
As the current entity, Virgin Australia it's financial upside of the expired FFC's is $0.00 as it earnt no income on them, no money received. When they were used they were a financial liability. On their balance sheet they may have had a line item for libability of paying airport fees etc when the FFC's were used, but really they have no profit gain from the expiry.
Yes to add when you bought the ticket the airline would have collected as part of the airfare, airport fees etc. So the previous entity pre voluntary administration burnt through that money too.
