The competition watchdog has slammed AirAsia X for its long delays in paying compensation to passengers hit by the cancellation of flights over summer.
The budget airline was due to begin flying from Melbourne to Bali on Boxing Day, but failed to secure authorisation from the Civil Aviation Safety Authority.
AirAsia X also announced in December it would stop flying from Adelaide to Kuala Lumpur in January.
The airline offered to compensate passengers affected by either suspension of flights, but that process has only recently been completed.
The Australian Competition and Consumer Commission (ACCC) received many complaints about delays in compensation, and has now ordered AirAsia X to review its process.
The airline says any new requests for compensation will be processed within two weeks, and has invited customers to lodge claims again if they are unhappy with the process.
"Consumers are entitled to compensation for any reasonably foreseeable loss due to the failure of a business to deliver a contracted service, and these claims should be dealt with promptly," ACCC chairman Rod Sims said.
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