Recent Developments in Regulation 261/04 and 1107/06 Passenger Rights
Background
Passenger rights legislation is constantly evolving both in the EU and the UK. The European Commission has recently proposed to improve passenger and traveller experience in a consultation for which feedback is requested by 29 January 2024. In addition, a Statutory Instrument came into force in the UK on 14 December 2023 to re-state certain EU case law principles in respect of Regulation 261/04 (EC 261/04).
European Commission Proposal
While both EC 261/04, which protects passenger rights in the event of denied boarding, cancellation and delay, and Regulation 1107/06 (EC 1107/06), which deals specifically with disabled passengers and passengers with reduced mobility, have been in force since 2004 and 2006 respectively, and were retained following Brexit, historically their amendment has faced several obstacles.
On 29 November 2023, however, proposals to amend various European passenger rights legislation including EC 261/04 and EC 1107/06 were published by the European Commission following findings in: (i) evaluations of Regulation 1107/2006 conducted in 2021, (ii) the 2020 Eurobarometer on passenger rights, and (iii) 2018 and 2021 reports issued by the European Court of Auditors. These sources identified perceived shortcomings in implementation and enforcement of passenger rights, in relation to (inter alia) EC 261/04 and EC 1107/06.
Amendments are at the Commission proposal stage, and will need to go through two readings in the European Parliament and the European Council, along with a Conciliation (a process designed to reach a compromise if proposals cannot be agreed between the European Parliament and European Council), before formal adoption. If the proposals are adopted, they shall have the effect of a Regulation.
Proposed Amendments to EC 261/04
The following proposals are made:
Reimbursement rights for bookings through an intermediary
Where passengers have booked through an intermediary (such as a travel agent), a carrier has a number of obligations, including: (i) providing clear information to the passenger on the reimbursement process, (ii) ensuring that reimbursement through the intermediary shall be free of charge to the passenger, and (iii) stating whether the carrier agrees to process reimbursements through intermediaries.
Additionally, where intermediaries have made payments to carriers, the reimbursement process obliges the carrier to: (i) reimburse the intermediary within seven days, in one transaction by the same method used for the booking, and (ii) if the passenger does not receive reimbursement within 14 days, the operating carrier will have seven days after receiving payment details from the passenger to provide reimbursement directly.
Service quality standards
Carriers must establish service quality standards that at least incorporate information on flight delays or cancellations, complaint handling, cleanliness of the transport and terminal facilities (such as air quality), adherence to industry standards on weight and dimensions of hand luggage, and the results of customer satisfaction surveys.
To that end, carriers must monitor their performance against the service quality standards, and publish a report on compliance every two years. Additionally, airport managing bodies must establish service quality standards and provide access to their performance to the national public authorities upon request.
Common form for reimbursement and compensation requests
A standardised form for compensation and reimbursements will be introduced, to be made available in all union wide languages, and a format accessible to persons with disabilities and/or reduced mobility. This form will be made available by the Commission on its website. However, operating carriers and intermediaries will not be able to reject a request solely on the grounds that a passenger has not used this form.
Furthermore, carriers and intermediaries shall provide information on how passengers can send this form in an electronic format (such as an email address). This obligation can be avoided if another electronic method of compensation (such as an online form) is provided in all union wide languages and accessible format.
National enforcement bodies
National enforcement bodies will develop a compliance monitoring programme that assesses the compliance of carriers, airport managing bodies and intermediaries with their new obligations on the basis of a risk assessment. Compliance will be tested by audits, inspections, interviews, and other methods on an announced and unannounced basis.
National enforcement bodies will also be entitled to receive information and relevant documents from carriers without undue delay, or within one month from receipt of the request (whichever is earlier). However, in “complex cases”, national enforcement bodies may extend this period to a maximum of three months from receipt of the request.
If a passenger complains to a national enforcement body, then the body is required to inform the complainant of their right to Alternative Dispute Resolution to seek individual redress.
Proposed Amendments to EC 1107/06
The amendments to EC 1107/06 are very similar to those to EC 261/04, although there are additional protections afforded to persons with disabilities and/or reduced mobility. Therefore, alongside the amendments to EC 261/04, EC 1107/06 adds:
Means of communication with passengers
Information provided to passengers should be done so in the most appropriate format, where technically possible, by electronic means. Additionally, where information is provided by electronic means, carriers, travel agents, tour operators, and ticket vendors will ensure that passengers can keep written correspondence on a durable medium. Communication methods must also allow passengers to contact the relevant organisation quickly and efficiently.
Service quality standards
In addition to the standards required in EC 261/04, information must be provided on assistance provided to persons with disabilities and persons with reduced mobility, including numbers of cases where persons with disabilities and/or reduced mobility were: (i) refused transport services, (ii) refused the carriage of recognised assistance dogs, or (iii) suffered a loss of mobility equipment, amongst others. Additionally, information on the provision of disability awareness and assistance training must be provided.
Cooperation between Member States and the Commission
Member States must regularly send information on the application of EC 1107/06 to the Commission, which will, in turn, make it available to other Member States.
Further, national enforcement bodies shall – at the request of the Commission – investigate any suspected non-compliance with obligations in EC 1107/06. In doing so, they have the right to investigate carriers, airport managing bodies, and tour operators, and report findings to the Commission within four months of request.
What does this mean for carriers operating to/from the UK/EU?
In proposing these amendments, the European Commission has aimed to “balance between the protection of passengers and the obligations of carriers and infrastructure managers.” However, the proposals must be adopted before they apply to carriers, until which time the current stance on EC 261/04 and EC 1107/06 remains.
If and when adopted by the Commission, it remains to be seen whether the UK will amend the Air Passenger Rights and Air Travel Organisers' Licensing (Amendment) (EU Exit) Regulations 2018 (the APR Regulations) to mirror the above proposals. If the UK seeks to adopt these proposals, it can do so by operation of the Retained EU Law (Revocation and Reform) Act 2023 which permits the replacement, modification, or updating of retained EU law.
This means that the proposals, if brought into force, would continue to apply to carriers in the same way as EC 261/04 and EC 1107/06, that is, to: (i) passengers departing from any airport in the EU, and (ii) passengers departing from the UK to the EU on an EU carrier; and (iii) passengers departing a third country to the EU on an EU carrier.
However, the proposals would not apply to passengers: (i) travelling on a UK carrier (unless operating from the EU); or (ii) travelling on an EU carrier between the UK and a third country; and (iii) other carriers operating from/to a UK airport.
Even where the proposals do apply to UK carriers, challenges to adoption can be foreseen, for example the reporting by national enforcement bodies to the Commission would need to be replaced by a UK equivalent, without which, the proposals may lose much of their “teeth.”
Non-adoption may have issues too, for example a UK carrier operating to the EU will not be caught by the new legislation but a passenger booking through an EU intermediary on (for instance) a one-way flight from a London to Paris will expect all the rights outlined in the proposal.
Time will tell whether the proposals are adopted in the EU and, if so, whether the UK will follow suit. While it is “business as usual” until then, carriers would do well to consider how the proposals can be implemented in practice, if required.
The Aviation (Consumers) (Amendment) Regulations 2023
These Regulations, which came into force on 14 December 2023, bring into secondary retained EU law (within the meaning of section 11(2) of the Retained EU Law (Revocation and Reform) Act 2023) certain EU case law principles relevant to EC 261/04 by amendment to that Regulation.
Article 2(2) inserts new definitions into EC 261/2004, in particular a definition of “extraordinary circumstances” which exempts the requirement to pay fixed compensation in the event of flight cancellation or delay. This is defined as:
“circumstances which cause delay or cancellation and (a) that (i) by their nature or origin are not inherent in the normal exercise of the activity of the air carrier, (ii) are beyond the actual control of the carrier, and (iii) the air carrier has taken all reasonable measures in relation to but was unable to avoid; or (b) arose from the impact of an air traffic management decision and could not have been avoided even if all reasonable measured had been taken.”
The definitions mirror existing European and English case law relevant to EC 261/04, which evolved while the UK was still a Member State, including in particular Wallentin-Hermann v. Alitalia ([2009] C-549/07) and Blanche v Easyjet Airline Company Limited ([2019] EWCA Civ 69).
Regulation 2(3) clarifies the concept of a flight comprising various sectors as a single unit, departing from the place of departure of the first sector, as set out in various cases including Wegener v. Royal Air Maroc SA (Case C-537/17 [2018] Bus LR 1366) and Chelluri v. Air India Ltd [2021] EWCA Civ 1953 [2022] Bus. L.R. 286.
Regulation 2(4) codifies the clarification of the scope of EC 261/2004 and its relationship with the Montreal Convention, mirroring decisions in R (International Air Transport Association) v. Department for Transport (Case C-344/04 [2006] ECR I-403), Nelson v. Deutche Lufthansa AG (Joined Cases C-581/10 and C-629/10 [2013] 1 All ER, and Cuadrench More v. Koninklijke Luchtvaart Maatschappij NV (Case C-139/11 [2013] 2 All ER (Comm) 1152.
Regulation 2(5) brings into statutory force the right to compensation in the event of a delay of 3 hours or more in reaching the final destination as set out in Sturgeon v Condor Flugdienst GmbH (Joint Cases C-402/07 and C-432/07).
While this does not change the interpretation of the Amended Regulation and EU case law in force at the time of Brexit, it gives English law force to that case law so that a breach of it will be a breach of the Amended Regulation itself. Whether this will, in practice, make any difference to carriers in terms of claims or enforcement remains to be seen.
