So, what has the EU ever done for us?
Quite a lot actually. Thanks to European Commission rulings, Irish consumers have a whole raft of extra legal protections against the worst excesses of big business, writes CONOR POPE
JUST OVER two years ago, there was almost visible steam coming out of Michael O’Leary’s ears as he stood in front of a phalanx of television cameras and swore he would not bow to the might of the European Union and foot the restaurant and hotel bills for Ryanair passengers stranded as a result of the Icelandic ash cloud.
“There’s no legislation that says any airline getting a fare of €30 should be reimbursing passengers many thousands,” the Ryanair chief executive fumed.
He was wrong. Under EU regulation 261, airlines must provide food and drinks and hotel accommodation, if appropriate, when passengers are stranded. And there are no time or monetary limits on the commitment.
Within 24 hours of O’Leary announcing that he would not pay, he was forced into an embarrassing U-turn and accepted that his airline would cover the reasonable expenses of stranded passengers.
In truth, he was probably showboating in the first instance and, when he made his stand, he was more interested in making a point than anything else.
O’Leary did have a point. A situation which sees an airline, which is forced to cancel flights through no fault of its own, liable to pay a passenger more than €1,000 despite the fact that the fare was less than 10 per cent of that, does seem a bit harsh.
The law is the law, however, and earlier this year, the advocate general at the European Court of Justice (ECJ) copper-fastened EU 261 when he ruled that travellers could not be abandoned abroad even if flight disruption was beyond the control of an airline.
“It does not appear to be disproportionate to impose, on air carriers, such an obligation to provide care, insofar as they are free to pass on the resulting costs to airline ticket prices,” the advocate general, Yves Bot, said.
“That is a policy which has already been put into effect by Ryanair, which introduced a special levy in April 2011 in order to cover the costs incurred in providing care to passengers whose flights had been cancelled owing to the eruption of the Icelandic volcano.”
The European Court of Justice made its ruling after the Dublin District Court referred the case of Denise McDonagh to it. She was due to fly with Ryanair from Faro to Dublin on April 17th, 2010, but was stranded in Portugal after the eruption of the Eyjafjallajökull volcano.
“The provision of care is particularly important in the case of extraordinary circumstances which persist over a long time,” the advocate general said. “It is precisely in situations where the waiting period occasioned by the cancellation of a flight is particularly lengthy that it is necessary to ensure that an air passenger, whose flight has been cancelled, can have access to essential goods and services throughout that period.
“A limitation of the obligation to provide care would, in some measure, deprive the EU legislation of its effectiveness since, after a few days, the air passengers concerned would be abandoned to their fate.”
It was, by any measure, a strongly worded ruling and an example of how consumers are better off as a result of the intervention of the EU than they would have been if they were relying on certain individual member states for protection.
It is not the only example of the EU protecting consumers against the dodgy practices of big business. For many years, Europe’s mobile phone operators were guilty of the most astonishing price-gouging, with consumers travelling from country to country within the EU being hit with ridiculous charges for sending text messages and making and receiving calls.
In 2006, Irish travellers who made a four-minute call home from France on their mobile could expect to pay as much as €5, while holidaymakers in Malta would pay an astonishing €9.76 for the same call. Receiving a four- minute call while in France cost up to €3.97, and in Malta it cost €7.96.
Mobile operators across the EU bleated about the higher costs associated with providing customers with roaming facilities, but were a lot less vocal when discussing the fact that the prices consumers paid were up to five times more than the actual cost the operators charged each other. In 2005, roaming generated €8.5 billion in turnover for mobile operators, of which up to €5.7 billion was profit.
Eventually, the European Commission said enough was enough and, in the summer of 2006, it published new regulations aimed at taking a big chunk out of these profits.
Consumers were also cut some slack when it came to using their mobiles to surf the web within the EU. In 2010, a €50 cap on roaming data charges came into force after a ruling by the commission and, following that, users would have to actively request to be allowed spend more than that.
And an agreement to cap mobile roaming rates for consumers, reached between the European Council and European Parliament last month, was approved by the Committee on Industry, Research and Energy in recent weeks.
Under the new rules, operators must lower the cost of calls made while abroad to 29 cents a minute, text messages sent to nine cents and 70 cents per megabyte of internet content downloaded. The costs will be further reduced by 2014, with call charges at 19 cents a minute, text messages at five cents and 20 cents per megabyte of data.
There are still more steps to be taken to improve the lot of Europe’s consumers across a broad range of sectors. Last week, the European Parliament debated a report from Spanish Social Democrat María Irigoyen Pérez on the rights of vulnerable consumers.
In it, she suggested a range of solutions for tackling common problems in sectors such as transport, finance and the internet.
She said the existing requirements within the financial sector covering product information and product suitability did not do enough to protect vulnerable consumers, especially older people. She added that about 70 per cent of websites belonging to financial institutions and companies contained errors concerning basic information on their products, while costs were presented in a misleading way. She called for clear and simple information on products and services, as well as financial literacy programmes.
In spite of exiting rules, travellers still found themselves in precarious situations on a regular basis, especially when there were delays or cancellations, Pérez said, and she highlighted issues with unfair terms at low-cost airlines.
“Fares that are difficult to understand can lead to some consumers paying three times more than others,” she added. “The commission should take vulnerable travellers into account when revising EU passenger- rights legislation and ensure better information and access to claim procedures.”
Pérez also suggested that social networks were using targeted advertising to focus on minors, taking advantage of social pressures, and called on the commission to analyse the impact of misleading and aggressive advertising on vulnerable consumers.
OTHER WAYS IN WHICH EUROPE HAS BENEFITED CONSUMERS
Consumer rights: new rules make it easier for companies to sell online or at a distance in other EU states, while also giving consumers greater protection. There is a 14-day EU-wide cooling-off period for online sales and the cost of returning products bought online must be clearly stated in the sales contract.
All products bought online must be delivered within 30 days, the trader is responsible for any damage to, or loss of, the product during delivery and there will be an end to hidden charges, such as those in the “pre-ticked boxes” sometimes used in internet sales.
Clearer food labelling: the energy content and amounts of fat, carbohydrates, sugars, protein and salt must all be stated in a legible form on the packaging, under EU rules.
At present, all ingredients – including allergenic substances – must be indicated on the labels of pre-packed foods. The new legislation extends this obligation to non- packaged foods, for example food sold in restaurants or canteens. Also the origin of fresh meat, from pigs, sheep, goat to poultry, has to be shown on the label.
Passenger rights: people travelling on boats that can carry more than 12 people will enjoy more rights. The new rules provide for assistance and compensation for delays as well as free assistance to disabled passengers. Passengers will be entitled to a maximum of three nights’ accommodation (at up to €80 a night). New rules on compensation for delays and cancellations, as well as assistance for disabled passengers, will cover all long-distance scheduled services (250km or more), whether national or cross-border, starting next spring.