Ryanair is being investigated after "unfair" charges were imposed on parents who wanted to sit with their children on flights.
The Competition and Markets Authority (CMA) has been looking into the airline's seat fees which the watchdog said cost around £8, describing them as "unfair" under consumer law.
In Ryanair's policies, parents must sit next to their child if they were aged between two to 11, calling this a "mandatory family seat", but parents would have to pay for this.
Ryanair have hit back, calling the investigation "bogus" and said their family seating terms and conditions were "fully" compliant with the law.
The CMA said: "[Ryanair's] approach to seat reservations may mean parents are being charged for the airline to meet its child safety and disability‑related obligations as set out under aviation rules – and will investigate to determine whether or not this practice is in line with consumer law."
It said they believe Ryanair is the only UK airline to impose such charges on families.
Other airlines allow parents or guardians to sit next to children free of charge, automatically allocating consecutive seats via booking systems for families.
The low-cost airline said parents can pay one reserved seat fee, "but can select reserved sears beside them for up to four children on the same booking FREE OF CHARGE".
The CMA have said parents are subject to a free of £8 to sit next to their child, which they have to do regardless under Ryanair's policy
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It said: "This means that parents travelling with children pay for only one (adult) reserved seat but pay nothing for the four other reserved seats for their children travelling with them."
The airline then pointed the finger at Sir Keir Starmer's Government saying it "pretends to care about consumers" while it still implements Air Passenger Duty (APD).
It continued: "This bogus CMA investigation is a failed effort by the Starmer Government to pretend it cares about consumers when it has failed to abolish APD which would immediately deliver lower fares for all consumers and growth for the UK aviation, tourism and wider economy.
"Ryanair looks forward to disproving these false CMA claims during this bogus investigation."
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Ryanair CEO Michael O'Leary blamed the Government for expensive flight costs
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APD is a per-passenger tax levied by the UK Government on the departure of most flights from British airports.
The rates are banded depending on class of seating and aircraft type.
The consumer watchdog would examine whether the family seat fees are "dripped" during booking and whether passengers are presented with the total price they will pay.
Hayley Fletcher, the CMA's Director of Consumer Protection said the fees can bump up costs for families who are trying to secure an affordable holiday.
She said: "Our investigation will consider Ryanair's approach to family seat reservations and how the cost is presented to consumers to determine whether they comply with consumer law.
"For the past year, we've told businesses to ensure their customers are shown the total price upfront – those who don't face the very real possibility of action from the CMA."
The investigation has just started, the watchdog confirmed, with no conclusions reached yet if the airline had "broken the law".
This is part of the CMA's crackdown on businesses taking advantage of consumers in a bid to ease the cost of living.
Under new powers, the watchdog can fine guilty companies up to 10 per cent of their global turnover.
The CMA has already triggered 15 investigations into businesses across the ticketing, gym, homeware and online review sectors.
It said they are "putting UK consumers at the heart of its action".
The watchdog aims to make an update on the investigation within the next six months.