PASSENGER RIGHTS - AIR

Background

Passenger Protection Against Airline Failure

Over the years there have been many failures of scheduled airlines and despite repeated attempts to extend consumer financial protection to all airlines, there has been great reluctance by successive governments and the European Commission, who prefer instead to rely on voluntary measures such as individual passenger travel insurance.

On 15 December 2009 a consultation on air passenger rights was launched covering airline insolvency, mishandled baggage, air carriers' business practices including DBC, and PRMs. Its aim is to review and, if necessary, improve legislation on air passenger rights.

MEPs voted overwhelmingly in November 2010 in plenary session of the European Parliament for a legislative proposal by 1 July 2010 to provide compensation and repatriation of passengers in case of airline failure.

An independent study is separately being commissioned with an impact assessment. We understand there will be stakeholder meetings in late February-early March. 

A proposal on the different elements is likely in mid 2010.

Denied Boarding Compensation (DBC)

Regulation 261/2004 came into force in February 2005 increasing the levels of DBC payable and expanding the regulation to cover delays in addition to denied boarding and cancellation. The Regulation is under constant review mainly to ensure that the National Enforcement Body (NEB) in each EU Member State - the Air Transport Users Council fulfils this role in the UK – takes a common approach. In November 2009 the European Court of Justice took a decision which widens the scope of the  Regulation and effectively means delays may be treated the same as cancellations and airlines will have to pay compensation to passengers who arrive three hours late at destination.

ABTA's Position

Passenger Protection Against Airline Failure

ABTA has lobbied for many years for consumer financial protection to be extended to scheduled airlines to ensure a level playing field for Members organising package holidays both in the UK and in the EU. We have welcomed the Commission’s announcement.

Denied Boarding Compensation (DBC)

The industry has serious concerns regarding this decision which will impact financially upon UK airlines and have unintended consequences for consumers. ABTA believes that it will not only lead to increased flight cancellations to mitigate delays over three hours but also lead to price increases. There is likely to be loss of consumer choice as marginal routes are withdrawn. ABTA has liaised with the UK airlines in making representation to Government.

Input into the Commission’s consultation will be both direct and via ECTAA.

Last updated: 09 March 2010