Bloomberg News

Lufthansa, IAG May Lose on Late Flight Cash, Court Aide Says

May 15, 2012

Deutsche Lufthansa AG (LHA) and British Airways Plc, owned by International Consolidated Airlines Group SA (IAG), should lose bids to limit compensation to passengers whose flights are delayed, an aide to the European Union’s top court said in a non-binding opinion.

Passengers may seek compensation of as much as 600 euros ($771) for delays of three hours or more, said Yves Bot, the advocate general to the EU Court of Justice. He rejected the airlines’ arguments that the compensation rules unfairly burdened them with extra costs.

“The proportion of flights for which delay confers entitlement to the compensation” under EU rules “is less than 0.15 percent,” Bot said in the opinion.

The EU has strengthened passenger rights by introducing rules that boosted compensation for airline travelers stranded because of overbooking or cancellation. The EU courts have been asked to rule on the limits of these rules in recent cases over passengers bumped from their flights and the closing of European airspace in 2010 due to a volcanic explosion.

Lufthansa is defending itself from a claim by a man traveling with his sons after a flight from Lagos to Frankfurt was delayed by more than 24 hours. British Airways, easyJet Plc (EZJ), TUI Travel Plc (TT/) and the International Air Transport Association industry group are challenging the U.K. Civil Aviation Authority over passenger compensation rules.

In both, local courts were asked to reconsider a 2009 EU Court of Justice ruling requiring financial amends for flights delayed by more than three hours.

2009 Ruling

British Airways is “aware of today’s non-binding opinion” and awaits the final ruling, according to an e-mailed statement. The 2009 ruling on passenger compensation “has come under criticism from many parties and we also believe the ruling was wrong,” the company said.

Lufthansa declined to comment pending a final EU court decision, said Peter Schneckenleitner, a spokesman for the airline.

EasyJet, TUI Travel and IATA didn’t immediately respond to e-mails seeking comment.

While Bot’s opinion isn’t binding, such advice is followed by the EU court in the majority of cases.

National tribunals will have the final say. A court in Cologne, Germany, will rule on the Lufthansa case. The High Court of Justice in London will decide on the challenge by TUI, British Airways, easyJet and IATA. Judges in both matters asked the EU court to rule on how the law should be applied.

The cases are C-581/10 Nelson and Others v Deutsche Lufthansa AG, C-629/10 TUI Travel plc, British Airways plc, easyJet Airline Co. Ltd, International Air Transport Association v Civil Aviation Authority.

To contact the reporter on this story: Aoife White in Brussels at awhite62@bloomberg.net

To contact the editor responsible for this story: Anthony Aarons at aaarons@bloomberg.net


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