JUSTIN WASTNAGE / BRUSSELS
No-frills airlines are preparing to join forces with full-service carriers in launching a legal challenge against recently passed passenger compensation rules.
The newly formed European Low Fares Airline Association (ELFAA) says it expects to challenge the new law, which came into effect last week after receiving approval from a majority of European Union countries. ELFAA president Wolfgang Kurth says budget carriers failed to effectively mobilise during the early days of the debate and will now bear the brunt of costs. "The prerequisite of our business model - namely low operating costs - is at risk right now and this would be a disaster for the industry and for consumers, as fares are likely to rise," says Kurth.
ELFAA, which represents 10 carriers, believes several aspects of the regulation to be illegal and is preparing to challenge the new rules through test cases. ELFAA believes the law, which makes airlines liable for accommodation expenses and return tickets in the event of a serious delay, is without precedent in European case law, since airlines are liable for delays beyond their control. Kurth says the link between compensation levels and distance runs contrary to EU custom of basing pay-outs on direct financial loss. "For the first time compensation could be more than the value of the fare; in law this is a fine and cannot be framed as compensation," he adds.
Kurth says the association has discussed its position with the Association of European Airlines (AEA), the European Regions Airline Association and the International Air Carrier Association (IACA) and may launch a joint attack with the bodies. The AEA says the laws are incompatible with both the Warsaw and Montreal conventions; while IACA says the terms "cancellation" and "delay" are insufficiently defined to form the basis of a legal text.
Source: Flight International
