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A new arrangement to help passengers affected by airline bankruptcy has been unveiled by Iata.
The airline trade body has rejected creating a statutory repatriation fund, claiming that financially prudent airlines would be subsidising riskier airlines.
Instead a voluntary agreement in Europe will cover the repatriation of passengers unable to return home due to airline financial failure.
Iata member airlines will make their “best efforts” to offer repatriation to stranded passengers.
They passengers will be offered discounted travel to return home, subject to available capacity.
The ‘rescue fares’ of a nominal amount will be available for purchase up to a maximum of two weeks after the failure to anyone who does not have insurance covering this eventuality.
Iata director general and chief executive, Tony Tyler, said: “I am delighted to say that passengers left stranded in the rare and unfortunate event of an airline bankruptcy will be offered ‘rescue fares’ from airlines to ensure they can get home.
“This agreement on rescue fares shows that the airline industry is more determined than ever to ensure reliable and consistently excellent customer service.
Airlines have formalised a unique co-operation agreement that puts passenger needs first.”
He added: “A compulsory levy on airlines to deal with repatriation would not serve anybody’s interest.
“We commend the European Commission for resisting this and for encouraging airlines to adopt this co-ordinated and customer-focused approach.”
The Commission estimates that only 0.07% of all passengers could be affected by airline bankruptcy between 2011 and 2020 and only 12% would require assistance in getting home.