The spread of the Coronavirus means massive financial problems for airlines around the world. Almost all off them offer free rebooking. Within the European Union, passengers enjoy extra protection by the EU Passenger Rights. The European commission recently published a set of new guidelines, expressing their view on cancellations caused by the travel regulations in the wake of the pandemic. This is interesting for airlines and travelers alike, as it constitutes whether such cancellations are caused by “extraordinary circumstances” and therefore have to be reimbursed or not.
These guidelines are not binding to European or national courts and don’t change the existing passenger rights. They express the European Commissions interpretation of existing law. Only the interpretation of the EU court is binding.
Please note that this is not legal advice! We’re just summarizing the EU’s document and commenting on it.
These are the most interesting passengers and our interpretation:
Restrictions to Stop the Spread are Extraordinary Circumstances
The commission declares that travel restrictions to stop or slow down the spread of the virus are extraordinary circumstances, outside the control of carriers. As a consequence, airlines are not obligated to reimburse passengers in general if they cancel flights up to 14 days in advance.
The Commission considers that, where public authorities take measures intended to contain the Covid-19 pandemic, such measures are by their nature and origin not inherent in the normal exercise of the activity of carriers and are outside their actual control.
Article 5(3) waives the right to compensation on condition that the cancellation in question “is caused” by extraordinary circumstances, which could not have been avoided even if all reasonable measures had been taken.
This condition should be considered fulfilled, where public authorities either outright prohibit certain flights or ban the movement of persons in a manner that excludes, de facto, the flight in question to be operated.3.4 Right to compensation
Still, it is left up to interpretation if flight cancellations due to low demand are covered by this. The commission states that this is the case as long as airlines have to expect that not a single passenger can or will show up for at least one flight of an airplane’s rotation:
This condition may also be fulfilled, where the flight cancellation occurs in circumstances where the corresponding movement of persons is not entirely prohibited, but limited to persons benefitting from derogations (for example nationals or residents of the state concerned).
Where no such person would take a given flight, the latter would remain empty if not cancelled. In such situations, it may be legitimate for a carrier not to wait until very late, but to cancel the flight in good time (and even without being certain about the rights of the various passengers to travel at all), in order for appropriate organisational measures to be taken, including in terms of care for passengers owed by the carrier. In cases of the kind, and depending on the circumstances, a cancellation may still be viewed as “caused” by the measure taken by the public authorities. Again, depending on the circumstances, this may also be the case in respect of flights in the direction opposite to the flights directly concerned by the ban on the movement of persons.3.4 Right to compensation
This will keep judges busy for quite some time. From our point of view, this does not free airlines from their obligation to reimburse passengers if they cancel flights due to low demand (as i.e. SAS explicitly stated, while Ukraine Air International didn’t).
A Refund Must be Offered in Case of Cancellation
If a flight get cancelled, the passenger must be offered a full refund if he elects to turn down the offer of a rerouting.
[… ] Reimbursement of the ticket price or a rerouting at a later stage “at the passenger’s convenience” might therefore be preferable for the passenger. […]2.1 Right to choose between reimbursement and rerouting
Some airlines offer passengers a voucher instead of a refund. This is unlawful if the airline is located in the European Union or the flight departs from EU territory.
Airlines Must Refund Complete Tickets in Case of Cancellation
The EU confirmed their position, that the cancellation of a round trip ticket results in the passengers right to demand either a full refund of the complete ticket or a rerouting at the earliest time – at the airlines’ expense.
However, if the outbound flight and the return flight are part of the same booking, even if operated by different air carriers, passengers should be offered two options if the outbound flight is cancelled: to be reimbursed for the whole ticket (i.e. both flights) or to be re-routed on another flight for the outbound flight (Interpretative Guidelines, Point 4.2).3.2 Right to reimbursement or re-routing
Airlines are Obligated to Care
Even if the earliest rerouting is days, maybe even weeks away – the airline has to care for the passengers in the meantime. This includes meals, drinks, accommodation and necessary transport.
[…] This consists of meals and refreshments in a reasonable relation to the waiting time; hotel accommodation if necessary, and transport to the place of accommodation. […]
This is the case, regardless if the cancellation is based in extraordinary circumstances or not:
According to the Regulation, the air carrier is obliged to fulfil the obligation of care even when the cancellation of a flight is caused by extraordinary circumstances, that is to say circumstances that could not have been avoided even if all reasonable measures had been taken.
The Regulation contains nothing that recognises a separate category of ‘particularly extraordinary’ events, beyond the ‘extraordinary circumstances’ referred to in Article 5(3) of the Regulation. The air carrier is therefore not exempted from all of its obligations, including those under Article 9 of the Regulation, even during a long period.3.3. Right to care
Airlines certainly expected a little more protection from the new guidelines, especially the right to reimburse passengers with vouchers instead of refunds. A clear statement regarding cancellations is missing and will likely keep judges busy in the months after the crisis.