Pressure grows to revamp air passenger rights

The European Commission’s revision of the air passengers rights legislation, formally known as Regulation EC/261, is due in 2012.

There is already intense pressure from consumer advocates and the airlines for changes to rules that affect all EU carriers and flights originating in the Union.

The regulation is one of the world’s most stringent and has long been heralded as a victory for consumers. But airline officials say the rules need to be overhauled to reflect extreme climate and political events that can cause mass schedule disruptions that are beyond the fault of carriers.

“Regulation 261 is not fit for purpose,” said David Henderson, spokesman for the Association of European Airlines. “It’s fine for covering the eventualities that it was designed to cover, in other words one-off instances of overbooking or cancellations.”

“But ultimately it was never designed for the mass events which, number one, created huge potential liability, and number two simply cannot be accommodated,” Henderson told EurActiv. “If you have 5,000 people at an airport stranded overnight, you simply cannot find the accommodation that you are legally obliged to provide.”

Ash and snow

The eruption of the Eyjafjallajökull volcano in Iceland caused days of chaos and massive losses for airlines in 2010, spurring the industry to press for changes to the passenger rights regulation.

Other events have caused major flight interruptions, including last year’s Christmas snowstorms, political upheaval in several Arab countries with popular tourist destinations, and Japan’s devastating tsunami and resulting nuclear power disaster that grounded or diverted passenger planes.

The airline industry is urging the commission to clarify compensation rules in the event of disasters or political unrest. Passengers now have a right to claim up to €600 in compensation, ticket reimbursement, plus meals and accommodation in the event of overnight rescheduling.

Siim Kallas, the Commission vice president in charge of transport, has acknowledged problems related to extreme events.

“In particular we cannot afford to turn a blind eye to the lessons learnt from what passengers and industry suffered during the 2010 ash crisis and snow,” Kallas said in announcing a review of the passenger rights rules. He said the review would seek to “plug loopholes, strengthen provisions where there are gaps, and clarify issues for passengers and industry where it is clear that after six years we need to adjust and fine tune."

Consumer groups seek expanded rules

But consumer groups fear a retreat and have defended the existing rules while calling for stronger rights for passengers, better enforcement at the national level, and a clear definition of ‘extraordinary circumstances’ where airlines can wave compensation.

There is also pressure to extend compensation to include delays and cancellations caused by airline bankruptcies.

The European Consumers’ Organisation (BEUC) advocates mandatory cover to protect passengers from last-minute schedule changes due to airline insolvency or suspensions of airline operating licenses.

The consumer group has rejected volunteer protections or other schemes, arguing in an October position sent to the Commission that only an EU regulation “is able to meet the policy objectives of providing comprehensive protection for all passengers at low costs”.

Some 96 airline bankruptcies were reported from 2000 to 2010, according to Commission and industry studies, including widely publicised cases where airlines shut down with passengers waiting at the gates. Among those were the collapse of Air Madrid in 2006 that left 100,000 people stranded and the demise of the Irish company EUJet that stranded 5,000 people.

SkyEurope, a popular low-cost airline based in Slovakia, collapsed at the height of the summer holiday season in 2009, leaving customers across Europe scrambling to find other flights.

But severe weather and the Eyjafjallajökull volcano that caused days of chaos and massive losses for airlines on both European and international routes prompted an industry call for regulatory changes. Although airline officials say they support the EU regulations’ compensation provisions for single incidents, they want changes for exceptional cases.

The AEA, which represents 36 passenger and cargo companies in the EU as well as several non-EU countries, has called the passenger rights regulation “fundamentally flawed”.

An industry group representing regional carriers is also urging the Commission to exempt airlines during extreme events.

“Airlines should not be responsible for compensation payments for cancellations caused by third parties over which the airline has no control or where there is no accountable third party, for example where statutory immunity exists or where the event is deemed as an ‘act of god’,” the European Regions Airline Association said in a position paper sent to the EU executive.