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Canada introduces uniform passenger protection rights - how does it stack up against the EU261/2004?

The European Regulation establishing common rules on compensation and assistance to passengers in the event of denied boarding and of cancellation or long delay of flights (“EU261”) although oft cited by airlines as the bane of its bottom line, is generally considered to be the world leading consumer protection framework.

It begs the question - why then did the Canadian Transport Agency simply not adopt the EU261?

Well, because the CTA thought it could do one better.

In drafting the Air Passenger Protection Regulations (“APPR”) the CTA cited that it had drawn on world’s best practices, including the EU261 in order to produce a regulation which was transparent, clear, fair and consistent.* In doing so, it received submissions from Canadians, travellers and airlines alike to create an APPR which fairly governs air passengers’ rights, whilst ensuring that the competitiveness of especially small and new entrant carriers is not eroded.

Therein lay the biggest differences to the EU261:

The APPR splits the liability compensation regime to ease competitive pressure for new entrants and smaller air carriers.

  • Different compensation limits apply to “Small” and “Large” airlines in the APPR.
  • “Large airlines” are defined as those which have carried 2 million or more passengers in the preceding 2 years and “Small airlines” are those which are not “Large”.

The scope of the APPR is all encompassing with respect to Canada.

  • The APPR applies to all flights to, from and within Canada, no matter the air carrier. This is pro-consumer as it is intended to provide certainty and choice for the consumer. Contrast this to the EU261 which although applies across all Europe, limits the application to flights within and leaving Europe (no matter the air carrier) and flights into Europe (only if air carrier European).

The APPR redefines the rules relating to when compensation is payable in the event of cancellation, delays and denied boardings.

  • “Situations Outside Airline’s Control” is a rule (of exemption to liability) rather than an exception as is the case in the EU261.
  • Comparable to the EU261 “Extraordinary Circumstances” the APPR defines more “Situations Outside Airline’s Control” - with the notable inclusion of internal strikes, which is held by European Case Law (Krüsemann & Ors v TuiFly Gmbh ) not to be an Extraordinary Circumstance which exempts an airline’s liability to pay compensation.
  • Notably absent in the APPR is the coinciding requirement to “Extraordinary Circumstances” that an airline must have taken “all reasonable measures” to avoid disruption occurring.
  • Another win for airlines in the APPR is the inclusion of Rotational Delays in exempting liability to pay compensation where this provision in absent in the EU261. This is definitely pro-airline as it is difficult for passengers to know or find out whether their delay was ‘directly attributable’ to an earlier ‘situation outside carrier’s control’.

The APPR sets clear time limits for the processing of claims of compensation to provide certainty to airlines.

  • Claims of compensation pursuant to the APPR must be made within 1 year of disruption. Contrast this to the EU261 which is silent on the limitation bar and necessarily defers the time limits to each of the member states’ domestic laws.
  • Airlines must respond with an acceptance or rejection of claim within 30 days of receiving it, whereas the EU261 is silent on timeframes for process.
  • Airlines must pay compensation (of up to $2,400.00) in the event of a denied boarding within 48 hours - opposed to a 7 day time frame indulged to airlines under the EU261.

The APPR stipulates the clear authority of the Canadian Transport Authority (“CTA”) to govern the APPR.

  • The CTA has the ability to impose fines of up to $25,000.00 for each event of non-compliance whereas the EU261 is enforced by member state’s local civil aviation authority.

What can be understood from the APPR is that it aims to strike the balance of fairness between passengers’ reasonable expectations and airlines’ reasonable and realistic operational challenges. It appears to do so by the provision of a very clear, predictable and comprehensive regulatory framework.

Time will therefore tell whether the APPR will replace the EU261 as the model passenger protection framework.

Written by Frédéric Pelouze

6 June 2019

1 Regulatory Impact Statement, Canada Gazette, Part II, Volume 153, Number 11.

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