IATA and Airlines for Europe (A4E) have termed as “disappointing and unhelpful” the European Commission’s new guidelines on how to apply the EU261 passenger rights regulation as global reaction to the COVID-19 crisis threatens the aviation industry.

The new guidelines, released on 18 March, fall short of the “simple and temporary alleviation” the airlines had asked for because of the global COVID-19 crisis, IATA and A4E said in a joint statement. “The new guidelines are disappointing and unhelpful.”

The European law provides compensation in the event of certain delays or cancelled flights. 

The measures requested by the airlines were:

  • Recognition that no compensation is due in the event of cancellations due to COVID-19;
  • A limitation on the extensive obligations to provide care and assistance in the event of cancellations due to COVID-19;
  • Flexibility to allow airlines to offer rebooking or vouchers in place of refunds in the event of cancellations due to the pandemic.

However, IATA and A4E acknowledged “some limited help” in the new guidelines. For instance, the guidelines recognize that cancellations caused by externally imposed measures such as flight bans or because of low demand are to be considered as “an extraordinary circumstance.” “This would mean,” the statement explained, “that in most current cases compensation for cancellation would not apply.”

However, limitations on providing care and assistance due to COVID-19 and flexibility on refunds or vouchers were described as “inadequate” by the two air transport organizations.

“No flexibility on the limitation of obligations was offered during a period of crisis for the aviation industry,” the statement said. “This means that airlines are potentially responsible for unlimited care to passengers who have been stranded as a result of government decisions to close borders.”

Further, the Commission specifically rejected the possibility of flexibility for airlines to offer rebooking or vouchers instead of refunds. 

“The Commission appears to considerably underestimate the crisis afflicting airlines in Europe,” said Rafael Schvartzman, IATA Regional Vice President for Europe. “Faced with a cashflow catastrophe, many airlines can only offer vouchers in lieu of immediate cash refunds for cancelled flights. The Commission must accept that this solution – which many people would regard as reasonable in the current extraordinary circumstances – should be facilitated. 

“The Commission needs to understand that fiddling at the edges will not keep airlines in any shape to get the economy moving again when the health crisis abates. This is not a short-term issue,” Schvartzman emphasized. “Air connectivity will not be back to normal for many months. And for some airlines, things will never be the same again.”

Thomas Raynaert, Managing Director, A4E, said, “Given the extraordinary circumstances and financial pressures our airlines are facing, if this is the Commission’s view, then an emergency amendment to Regulation 261 may be needed, and would be welcomed by the sector.”

 

Picture Credit | iStock

 

 

 

 

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