IATA Says European Commission Underestimates Pandemic Impact

Bruce Parkinson, Open Jaw

Rafael Schvartzman

The International Air Transport Association (IATA) and Airlines for Europe (A4E), have reacted with dismay to the European Commission’s new guidelines on the application of the EU261 passenger rights regime.

“The new guidelines are disappointing and unhelpful, falling far short of the simple and temporary alleviation airlines had requested,” IATA says in a statement.

Here’s what IATA was asking for:

 

  • Recognition that no compensation is due in the event of cancellations due to COVID-19;
  • A limitation on the extensive obligations to provide care and assistance in the event of cancellations due to COVID-19;
  • Flexibility to allow airlines to offer rebooking or vouchers in place of refunds in the event of cancellations due to the pandemic.

“There was some limited help in the new guidelines,” IATA says. “They recognized that cancellations caused by externally imposed measures (such as the flight bans) or because of the very low demand are to be considered as an extraordinary circumstance. This would mean that in most current cases compensation for cancellation will not apply.” 

IATA’s main concern is flexibility around refunds versus vouchers. IATA calls the Commission’s response “inadequate.”

“No flexibility on the limitation of obligations was offered during a period of crisis for the aviation industry. This means that airlines are potentially responsible for unlimited care to passengers who have been stranded as a result of government decisions to close borders. On the request for flexibility to offer rebooking or vouchers in place of refunds, the Commission specifically rejected that possibility.”  


IATA says the European Commission appears to considerably underestimate the crisis afflicting airlines in Europe. 

“Faced with a cashflow catastrophe, many airlines can only offer vouchers in lieu of immediate cash refunds for cancelled flights. The Commission must accept that this solution – which many people would regard as reasonable in the current extraordinary circumstances – should be facilitated,” said Rafael Schvartzman, IATA’s Regional Vice President for Europe.

“The Commission needs to understand that fiddling at the edges will not keep airlines in any shape to get the economy moving again when the health crisis abates. This is not a short-term issue -- air connectivity will not be back to normal for many months. And for some airlines, things will never be the same again.”

Bruce Parkinson

Bruce Parkinson Editor-in-Chief

An observer and analyst of the Canadian and international travel industries for over 25 years, Bruce uses the pre-dawn hours to prepare a daily news and information package to keep industry members up to date.

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