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The footage, captured via CCTV cameras located in its airplanes, is intended for "security purposes," according to Cathay.
"In line with standard practice and to protect our customers and frontline staff, there are CCTV cameras installed in our airport lounges and onboard aircraft for security purposes," Cathay Pacific said in a statement seen by The Independent.
Cathay told CNBC there is only one camera onboard each aircraft located near the cockpit door for security purposes.
"There are no CCTV cameras installed in the lavatories," the airline added.
The announcement comes months after it was revealed that multiple airlines have cameras installed in their in-flight entertainment systems (IFEs). American Airlines, Singapore Airlines and Emirates said at the time that they had no plans to activate their cameras.
Cathay Pacific, for its part, said it has never installed such devices in its IFEs.
"Our inflight entertainment systems do not have any cameras, microphones or sensors to monitor passengers, nor have they in the past," it said in the statement.
However, the airline, which is often ranked among the world's best, has come into privacy issues of its own in the past. In October 2018, Cathay reported a data breach that potentially impacted more than nine million passengers.
In its updated policy, the airline said its data collection processes were intended to improve the flying experience and enable greater personalization. However, it added that personal data may also be shared with third-party partners for marketing purposes.
"We will retain your personal data for as long as is necessary," the policy says.
— Clarification: This article has been updated to include Cathay's response to CNBC's queries.