The European Court of Auditors’ special report “Air Passenger rights during the Covid-19 pandemic”, covering the period from March 2020 until March 2021, was published on 29. June. ECA reporting member Annemie Turtelboom also presented the findings on 14. July during a European Parliament public hearing. The report confirmed that key passenger rights were not respected and passengers were treated differently. In addition, protection of air passenger rights has not been linked to state aid. The Commission tried to protect the rights of air passengers but has limited enforcement powers. EPF is satisfied with the content of the report and the recommendations it contains, as it is in line with the input we delivered (with the help of our members) to the auditors earlier this year. 

Below, we provide a summary of the ECA report. The full report can be consulted here.

Key passenger rights were not respected and passengers were treated differently.

• Passengers have insufficient knowledge about their rights, which can result in them not being reimbursed. Different rules apply to flight-only and package travels: package travellers are able to get a refund if they cancel their trip, for flight-only trips this is not possible.
• Passengers were not reimbursed or forced to accept vouchers, especially in the initial phase of the pandemic. Reimbursements started again after June 2020, still taking in general much longer than the required 7 (flight-only) or 14 (package travels) days.
• The role of intermediaries is not addressed in the air passenger rights regulation, which hampers passengers’ ability to secure reimbursement. As a result, passengers were in many cases ‘ping-ponged’ between intermediaries and airlines in their efforts to get a refund.
• The Commission issued a Recommendation in May 2020, to make vouchers a more attractive and safe alternative. However, as it was non-binding, airlines and package organisers continued to issue vouchers as they saw fit and passengers were treated differently.
• There is no reporting requirement for NEBs to the Commission under Regulation 261/2004 and airlines usually do not share data on passenger claims, which makes it difficult to get a clear overview. However, there are many indications of a signification increase in complaints.

Protection of air passenger rights has not been linked to state aid.

• The EU’s temporary state aid framework facilitated the granting of unprecedented amounts of state aid to both airlines and package travel organisers – which helped to prevent their bankruptcy (in which case passengers would risk losing their money).
• Member States were required to state how such state aid was used to support EU policy objectives related to the green and digital transformation; however there was no such requirement related to reimbursement of passengers.
• In none of the 38 cases reviewed, reimbursement of passengers was a condition for granting state aid to airlines. In 13 of 16 cases reviewed, state aid to package travel organisers did reflect direct concern with passengers (refund, repatriation, voucher insolvency protection).

The Commission tried to protect the rights of air passengers but has limited enforcement powers.

• In May 2020, the Commission issued a (non-binding) Recommendation on vouchers, advising that these should be: voluntary; valid for at least 12 months and afterwards automatically reimbursable in cash; flexible and transferable; insolvency-protected.
• In June 2020, the Commission launched the Re-Open EU portal. However, the information on this portal had to come from Member States and was sometimes found to be outdated, inconsistent or incomplete.
• In July 2020, the EC launched infringement procedures against Member States who had introduced national law that did not respect EU Regulations (Air Passenger Rights Regulation, Package Travel Directive).
• Proposals to enhance the Commission’s enforcement powers (improved complaint handling procedures, strengthened enforcement, monitoring and sanctioning) were proposed in 2013 but so far the Council has not agreed on its position.
• Current legislation does not cover insolvency protection for flight-only passengers. There is no financial protection for vouchers either (with a few exceptions) and even in the case of Package Travels, the foreseen protection is not 100% secure.

The report concludes with four recommendations to the EC.

1. Better protection of, and information on, air passenger rights (by end 2022)
   • improve information to passengers on their rights (e.g. through guidelines, social media, legislative proposals)
   • enhance pro-active monitoring by NEBs (e.g. through reporting obligations of carriers to the NEB or inspections to check information provision to passengers)
   • introduce an EU-wide standardized reimbursement form
   • ensure reimbursement within 7 or 14 days, also in times of crisis (e.g. by restricting prepayments at the moment of booking; extending insolvency protection to vouchers & flight-only tickets; creating guarantee funds; setting aside a fixed percentage of the ticket price (“ring-fencing”) to cover claims)
   • review the fitness check rules to mitigate the risk of airline insolvency
2. More coordination of national measures and better linking state aid to airlines to reimbursement of passengers (by end 2021)
   • improve communication between Member States about national measures with important consequences for airlines (e.g. quarantine, travel bans)
   • remind Member States that State aid can cover reimbursement of air passengers
3. Improved tools and legislation for safeguarding air passenger rights (by end 2022)
   • ensure that Member States provide timely, reliable information to Re-open.eu
   • ensure reporting from the NEBs on enforcement of air passenger rights on a regular basis and if necessary ad hoc
   • provide NEBs with the necessary means to enforce air passenger rights
   • clarify rules and responsibilities for ticket reimbursement in case of intermediaries
   • ensure effective enforcement power of CPC (Consumer Protection Cooperation) authorities to enforce passenger rights
4. Considering the relevance of these recommendations for other modes of transport.

EPF is satisfied with the content of the report and the recommendations it contains, as it is in line with the input we delivered (with the help of our members) to the auditors earlier this year. The EC has accepted the recommendations, so we look forward to see how they will be implemented in the not too distant future.