The Hindu : International : Air travel snafus spell bonanza

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Friday, Feb 25, 2005

International

International

Air travel snafus spell bonanza

By Micheline Maynard

LONDON, FEB. 24. Airline passengers travelling in Europe can now receive up to tens of thousands of rupees in compensation when things go wrong with their flights, under new rules that took effect on February 17. The compensation deal can include hotel rooms, phone calls, meals and refunds.

The rules, which were approved by the European Commission early last year, are applicable to passengers of any nationality who fly into or out of airports in the 25 European Union (E.U.) member-nations. This, passengers must be compensated if their flights are delayed by more than two hours or cancelled for reasons that the airlines could have anticipated and resolved — for example, a plane that is delayed for routine maintenance that could have been performed earlier, or a flight that is cancelled because it is not fully booked. (A complete list of compensatory measures is at www.auc.org.uk, the website for the Air Transport Users Council.)

But an unexpected consequence could be higher fares, experts say, if airlines try to pass on the costs. The rules come in the wake of a spate of new airline start-ups across Europe, where competition between traditional and low-fare airlines has been fierce.

Last year was the busiest-ever for European air traffic, with 8.8 million flights, up about 5 per cent from 2003, the most growth for any year since 1999. Delays affected as many as 20 per cent of flights to and from Britain last year.

The effort by the E.U. is in sharp contrast to practices in the U.S. Although the Federal Government has rules to govern instances in which passengers are "bumped'' from flights, the airlines, not the Government, set the level of compensation when flights are delayed. Some give out meal and beverage coupons; in a few cases, travellers might get a hotel room. But cash compensation is rare. That is how things had been done in Europe, too, until now.

``On the face of it, the regulations seem fairly generous,'' said David M. Rowell, an industry consultant who operates The Travel Insider website. ``Now the airlines will be more fiscally accountable for situations where they've failed to deliver what they've promised.''

Outrage

But the rules immediately sparked outrage among the airlines, which say they could be forced to pay out billions of dollars a year at a time when the industry has been in a slump. While European carriers will be the most affected, analysts believe that U.S. and international airlines that depart from E.U. country airports would have to comply with the regulations, too.

The rules have triggered a wave of lawsuits, led by the International Air Transport Association (IATA). But those lawsuits may not be heard until later this year, which means the airlines are supposed to be operating under the rules until then.

David Stempler, president of the Air Travellers Association, which represents consumers in the U.S., said he doubted that the regulations would be copied in the U.S. For one thing, he said, the regulations are ambiguous. For example, some European airlines contend they might be held liable for weather delays, since passengers could argue that they could re-route planes around storms.

Mr. Stempler said he is concerned that the rules might lead some airlines to take risks rather than face penalties for flights that depart late: ``You don't want to dispatch an airplane under a situation that is less than perfect.''

A spokesman for British Airwayssaid the airline considers the compensation to be excessive. The airline already compensates passengers in many instances when flights encounter lengthy delays or are cancelled, he said.

Under the European Commission rules, if a flight is cancelled less than two weeks in advance of departure, and the airline has not provided an alternative flight, passengers are entitled to a refund plus compensation of 250 to 600 euros (about Rs. 14,500 to Rs. 34,800) depending on the length of the flight. The lower quantum of compensation goes to those flying 1,500 km or less; the higher to those flying more than 3,500 km.

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