European Commission Regulation 261/2004 on compensation and assistance to passengers in the event of denied boarding and of cancellation or long delay of flights

13.09.2007 Karina Kaca, American Investor

If you are an air traveler, any flight that you take can be delayed or cancelled for a number of reasons, or sometimes you can even be denied boarding to a flight due to overbooking. Usually, a little delay does not cause any significant hardship. However, there are times when delayed or cancelled flights can lead to missed negotiations, unexpected overnight stays in the airport, unplanned expenses and other inconveniences. Since there is no way how we can avoid such situations we should at least be aware of our passenger rights provided by the European legislators, namely – European Commission Regulation 216/2004.

The Regulation went into effect on February 17, 2005. It sets out the entitlements of air passengers when a flight that they intend to travel on is delayed or cancelled, or when they are denied boarding to such a flight due to overbooking, or when the airline is unable to accommodate them in the class they had booked.

The Regulation applies to any passenger departing from an EU member state, or travelling to an EU member state on an airline based in an EU member state if that person has a confirmed reservation on the flight, and arrived in time for check-in as indicated on the ticket or communication from the airline, or, if no time is so indicated, no less than 45 minutes prior to the scheduled departure time of the flight .

The Regulation require the airline to take better care of their passengers in the following situations:

Denied Boarding

Denied boarding due to overbooking is a rather typical situation. Airline companies often turn to the practice of overbooking to ensure that their flights are as profitable as possible. They sell more tickets than there are seats on a given flight, knowing that a certain number of passengers will fail to check in. This practice is quite understandable from a commercial point of view, although it may cause severe inconvenience to passengers who are denied boarding on a flight for which they have arrived as requested.

The Regulation attempts to maintain a balance between the commercial profitability of airline companies, by not preventing them from overbooking, and the protection of the interests of air passengers, by granting them some rights if they are denied boarding.

So, imagine you have arrived for check-in and suddenly you are informed that you cannot fly due to overbooking. Be aware that according to the Regulation, before denying passengers boarding involuntarily, the airline is required to first seek volunteers to give up their reservation in return for whatever benefit is negotiated between the airline and the volunteers. Regardless of such negotiation, such volunteers are also entitled to compensation or rerouting as described below. If insufficient volunteers are obtained, the airline may then proceed to involuntarily deny passengers the right to board their flight. All passengers so denied must be must be provided by the airline with the following:compensation of the cost of the ticket within seven days or a return flight to the first point of departure or re-routing to the final destination,refreshments and meals (in proportion to the waiting time), hotel accommodation, transport between the airport and place of accommodation, two free telephone calls, telex or fax messages, or e-mails; and compensation totallingEUR 250 for flights of 1,500 km or less,EUR 400 for longer flights within the EU and other flights between 1,500 and 3,500 km,EUR 600 for flights over 3,500 km outside the EU.

Delayed Flight

If an airline expects a flight to be delayed, passengers are entitled to refreshments and communication if the expected delay is more than:two hours for flights of 1,500 km or less;three hours for longer flights within the EU and other flights between 1,500 and 3,500 kmfour hours for flights over 3,500 km outside the EU. Additionally, if the flight is expected to depart on the day after the original scheduled departure time, passengers are entitled to accommodation.

If a flight is delayed by five hours, passengers are additionally entitled to abandon their journey and receive a refund for all unused tickets, a refund on tickets used already if the flight no longer serves any purpose in relation to their original travel plan, and, if relevant, a flight back to their original point of departure at the earliest opportunity.

Cancelled Flight

If a flight is cancelled, passengers are automatically entitled to a re-routing or refund. Where applicable, they are also entitled to refreshments, communication and accommodation as described above.

The airline is also required to pay cash compensation as described above, unless one of the following conditions applies:the airline notifies the passengers at least two weeks prior to departure;the airline notifies the passengers between one and two weeks prior to departure, and re-routes passengers so that they can either depart no more than two hours earlier than scheduled, or arrive no more than four hours later than scheduled;the airline notifies the passengers less than one week prior to departure, and re-routes passengers so that they can either depart no more than one hour earlier than scheduled, or arrive no more than two hours later than scheduled;the cancellation was caused by extraordinary circumstances that could not have been avoided by any reasonable measure.!

Obligation to notify passengers

Airlines are obliged to display a notice at their check-in counters stating “If you are denied boarding or if your flight is cancelled or delayed for at least two hours, ask at the check-in counter or boarding gate for the text stating your rights, particularly with regard to compensation and assistance.” Additionally, when an airline cancels a flight, denies a person boarding, or incurs a delay exceeding two hours to a flight, it is obliged to provide each passenger affected with a written notice setting out their rights under the Regulation, and the contact details of the national body dealing with enforcing the Regulation (in Latvia it is Consumers Rights Defence Centre, or PTAC).

! Applicability of the Regulation

Some air carriers claim that they are not bound by the provisions laid down in the Regulation 261/2004. This claim has no legal basis. The Regulation is applicable to absolutely all airline companies, irrespective of whether or not they are members of the IATA (International Air Transport Association). The Regulation applies to all air companies and all flights, whether budget, chartered or scheduled.

! If a passenger chooses compensation:

it must be paid within seven days; andit must be paid in cash, by electronic bank transfer, bank orders or bank cheques.

Compensation can be paid in travel vouchers and/or other services only if there is a written agreement between the air carrier and a passenger. In other words, a passenger who is denied boarding cannot be obliged to accept travel vouchers as a means of reimbursement if he does not consent to it in writing.

! Upgrading and downgrading seats

If on an overbooked flight, you are offered a seat in a higher class than your original booking, the airline cannot charge you an additional payment for this seat.

If, on an overbooked flight, you agree to be placed in a lower class than on your original booking, you are entitled to reimbursement of a percentage of the difference in price. In other words, if you booked a business/first class seat and you have been denied boarding, the airline can offer you a seat in a lower class but must refund you a percentage of the ticket price you originally paid. The percentage of the refund is calcuated as follows:30% of the ticket price for flights of 1,500 km or less or50% of the ticket price for longer flights within the EU and other flights between 1,500 and 3,500 km or75% of the price for all flights over 3,500 km outside the EU.

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