EU states urge suspension of airline refunds

EU member governments are demanding the European Commission suspend the right of air passengers to cash refunds for flights cancelled due to coronavirus and “allow airlines to choose” how passengers are reimbursed.

Twelve EU states, including Belgium, France, Greece, Ireland, the Netherlands and Portugal, have issued a joint statement demanding the temporary amendment of EC Regulation 261 on air passenger rights.

They called for “the temporary issuance of vouchers [and] a common set of criteria” for these across the EU.

Regulation 261 compels airlines to refund customers for cancellations within seven days – a rule which has been breached wholesale by carriers since the Covid-19 crisis began.

Travel Weekly understands at least 15 European governments have lobbied the EC for a temporary change to the regulation in light of the cash crisis facing airlines and the wider travel industry.

A majority of EU governments, including Germany, have acted independently of the EU to sanction refund credits in place of cash refunds during the crisis.

The UK remains the only major European government yet to do so, despite being in transition to depart the EU.

In a joint statement, the 12 governments said: “The Covid-19 pandemic has had an unprecedented impact. An immense number of flights have been cancelled. Air carriers are no longer generating passenger business yet they continue to incur high running costs.

“Regulation EC261/2004 and its obligation to reimburse cancelled tickets in cash places airlines in a difficult situation where they are facing a serious cash flow challenge.

“When the wording of the regulation was conceived, the current global crisis and its impact on air travel could not have been foreseen.

“The goal shared by the EU and its member states must now be to preserve the structure of the European air traffic market beyond the current crisis, while considering the interests and necessary protection of passengers.

“We therefore call upon the EC to propose, as matter of urgency, a temporary amendment of Regulation 261/2004, possibly preceded by interpretative guidelines which allow airlines to choose the means by which passengers are reimbursed.

“This has to be done similarly across the EU according to a common set of criteria.”

The governments suggest “the temporary issuance of vouchers” would be “acceptable for consumers” so long as in line with “key principals”.

These include “transparent information to the passenger, a common length of voucher validity, maximum flexibility of use and a clear right of reimbursement immediately at the end of validity”.

They call for financial protection of the vouchers against airline insolvency and urge “all stakeholders, including the aviation sector and consumer organisations, to join their efforts to reach a constructive and common solution”.

However, the UK consumer association’s travel publication, Which? Travel, condemned the move and demanded the UK government assert consumers’ rights to cash refunds.

Which? Travel editor Rory Boland said: “It’s incredibly concerning that a number of EU member states are asking to temporarily suspend consumers’ legal right to cash refunds for cancelled flights, not least when so many people are now in difficult financial situations.

“Not only would this be bad news for consumers, it would be a disaster for tour operators waiting for payments to be returned by airlines in order to fulfil their own legal obligations to refund customers.

“The UK government must urgently confirm that it will continue to support consumers’ right to cash refunds and step in with support for the industry to allow them to fulfil this legal obligation.”


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