Court upholds rules to give air travellers greater compensation

Irish airlines have criticised a decision by the European Court of Justice to uphold new rules that give air passengers greater compensation for cancellations, delays and overbooking.

The court yesterday decided that the rules introduced last year were in line with EU regulations, while Ryanair claimed they were discriminatory and anti-competitive.

The European Low Fares Airline Association, of which Ryanair is a leading member, had challenged the legislation on the basis that it did not apply to competing forms of transport such as trains, ferries and buses and had no relationship to the fare paid by the consumer.

It also claimed the rules were unfair and too expensive, because in some cases the level of compensation was more than the bargain-rate price of travel.

"This discrimination and distortion of competition is highlighted on a day when the ferries cancelled all services to Ireland but are not required to re-accommodate passengers or pay any compensation whatsoever," said Jim Callaghan, Ryanair's head of regulatory affairs.

"It makes no sense. Why is there one rule for airlines, which rarely cancel flights, and a different set of rules for ferries and trains, which frequently cancel?"

Under the EU deal, which applies to scheduled and charter flights, including package-holiday flights, passengers denied boarding receive compensation of €250 for short-haul flights, rising to €600 for long-haul flights.

A full money-back scheme, plus free hotel accommodation, applies to extensive delays.

Aer Lingus expressed disappointment with the judgment of the court in Luxembourg and said it would study the ruling to see what implications, if any, it had for the airline's operations.

"Aer Lingus takes all reasonable measures to avoid disruption to its flights but, where disruption does occur, it operates to the highest standards of customer care," a spokeswoman said.

"However, we are concerned that the regulation, which obliges airlines to provide a minimum standard of care and assistance to passengers in cases of disruption, even where these are due to circumstances outside the airlines' control [eg weather], will inevitably lead to an increase in the operating costs of all airlines."

The International Air Transport Association, of which Aer Lingus is a member, claimed the ruling would add $700 million worth of costs to the industry, which would have to be recouped.

Fine Gael MEP Maireád McGuinness yesterday welcomed the court's decision as setting "basic standards" for the treatment of consumers in airline travel.

"In fairness to consumers who are increasingly using airlines and experiencing delays, this ruling will force the airline industry to make sure that it adheres to its schedules in the knowledge that where it doesn't, it will have to pay the price."

The European Commission also welcomed the ruling as "good news" for air passengers.

The EU says it introduced the measure because of growing complaints about overbooking. Airlines frequently sell more tickets than there are seats on an aircraft because up to 10 per cent of passengers do not confirm their reservations or check in on time or simply do not turn up for their flights. Overbooking can lead to "bumping", when a passenger is moved to a later flight.