Oct. 23 (Bloomberg) — Deutsche Lufthansa AG and British Airways lost challenges at the European Union’s top court over paying compensation to passengers delayed by more than three hours.”Where passengers reach their final destination three hours or more after the scheduled arrival time, they may claim fixed compensation from the airline, unless the delay is caused by extraordinary circumstances,” the EU Court of Justice in Luxembourg said in a ruling today that confirms an earlier, precedent-setting decision by the court.
The ruling on two separate cases also involves EasyJet Plc, TUI Travel Plc and the International Air Transport Association. It upholds a 2009 decision that airlines have to compensate passengers who reach their final destination three or more hours later than expected because of a flight delay. Carriers are exempt from compensation in cases of extraordinary circumstances, such as a strike or bad weather conditions.
Lufthansa extended earlier declines to lose as much as 2.2 per cent after the decision, and was trading 1.6 per cent lower at 10.94 euros as of 11:19 a.m. in Frankfurt. Company spokesman Boris Ogursky declined to comment until Lufthansa has seen the full text of the ruling.
TUI Travel fell as much as 0.7 per cent in London trading and declined 0.4 per cent at 10:20 a.m.
Mike Ward, a spokesman for TUI Travel, said the company would work for a revision of the underlying legislation so that it strikes the right balance for passengers and airlines.
“We are committed to treating our customers fairly,” Ward said in an e-mailed statement.
EasyJet spokesman Paul Moore said that while the company was “disappointed at the outcome,” it welcomed the judgment because it provided “much-needed clarity on this matter,” according to an e-mail.
EasyJet retreated 0.5 per cent, to 605 pence at 10:21 a.m. in London. Ryanair Holdings Plc declined 0.9 per cent, to 4.48 euros at 10:16 a.m. in Dublin trading.
The 2009 ruling clarified that under EU law passengers whose flights are delayed have the same rights to compensation as passengers whose fights are canceled. The law doesn’t specify this. Previous rulings have also made clear that airlines must compensate passengers in cases of delays due to mechanical problems.
London’s High Court and a German court referred separate disputes pending before them to the EU court, seeking clarification on exactly when compensation is due. The EU court gives guidance for their judgments without deciding on the specifics of the cases.
TUI Travel, EasyJet, British Airways and IATA are challenging the Civil Aviation Authority in the U.K. after the CAA confirmed it was bound by the EU court’s 2009 ruling and couldn’t exempt them from the obligation of compensation in cases of delays.
IATA declined to immediately comment on today’s ruling.
In the German case, a family is challenging Lufthansa after a delay due to technical problems on their plane on a 2008 trip brought them more than 24 hours later than expected to Frankfurt from Lagos, Nigeria. The German tribunal had suspended the case pending the EU court’s 2009 ruling and then decided to refer further questions to the Luxembourg-based court.
The cases are: C-581/10, Emeka Nelson, Bill Chinazo Nelson, Brian Cheimezie Nelson v Deutsche Lufthansa AG; C-629/10, TUI Travel Plc, British Airways Plc, easyJet Airline Co. Ltd, International Air Transport Association, The Queen v Civil Aviation Authority.
–With assistance from Alex Webb in Frankfurt and Kari Lundgren in London. Editors: Peter Chapman, Andrew Clapham
To contact the reporters on this story: Stephanie Bodoni in Luxembourg at [email protected] Aoife White in Brussels at [email protected]
To contact the editor responsible for this story: Anthony Aarons at [email protected]
Business Insider Emails & Alerts
Site highlights each day to your inbox.