Flying in the dark

Heard of European Commission regulation No 261/2004? If not, don't worry, you're not alone. And what's more, the airline industry would be more than happy for you to remain in the dark about the significance of this ruling.

The airlines care because it sets out just what compensation you are entitled to claim when your flight is delayed, you are denied boarding because of overbooking, a flight is cancelled, or you cannot be accommodated in the class that you booked.

The ruling came into effect on 18 February 2005. More than two years later, its implications have, to all intents and purposes, been gathering dust in most airlines' offices.

That may be about to change, as last week the European Commission finally lost patience with the dilatory way in which airlines had taken the regulation on board. While the commission stopped short of accusing the airlines of breaking the law, Brussels criticised the industry for doing the bare minimum that was required to make passengers aware of their new rights. It was backed by the Air Transport Users Council, which said complaints about delays had trebled in the two years since it became law.

Airlines must now offer refreshments, meals and hotel accommodation in the case of flights that are delayed for more than two hours. Compensation increases in proportion to the nature of the flight. A passenger can claim €250 (£170) for flights of less than 1,500km, €40 (£272) for flights between 1,500km and 3,500km and €600 (£408) for flights of greater distances. The regulation is wide-ranging and applies to any passengers departing from any of the 27 EU member states to any destination, or travelling to an EU member state on an EU-based airline. To be eligible, you simply need to have a ticket and to have turned up in reasonable time before departure. Airlines do not have to pay out if there are "extraordinary" circumstances that the airline could not have reasonably avoided - security alerts, for example, or bad weather.

But although the airlines have not exactly gone out of their way to highlight the rights of their passengers to compensation, they have been quietly lobbying behind closed doors - and indeed in open court. Last year, the European Court of Justice in Luxembourg rejected a challenge to the ruling from the airline industry, which had argued that the EU's rules created confusion and could cause some low-cost airlines to fold. The International Air Transport Association, an umbrella organisation for most of the world's airlines, warned at the time that the EU's requirements for compensation would cost the aviation industry up to €600m (£408m) a year.

Another lobby group, the European Low Fares Airline Association, pointed out that the new compensation rules could require airlines to pay passengers back significantly more than the price of the lowest cheap fares. The European Regions Airline Association said the industry would simply pass the bill on to passengers in the form of higher fares. The court dismissed these arguments and instead ruled that the compensation framework was legitimate and compatible with international rules on passenger compensation.

And last week it was the European Commission's turn to raise the spectre of court action if the airlines did not actively implement the new compensation rights. A report by the Commission said that it had received thousands of complaints from customers and declared that it would give the industry six months to make the regulation work.

If the deadline is not met, said Transport Commissioner Jacques Barrot, the Commission would begin legal proceedings and may even toughen the rules further. Those inevitable Bank Holiday getaway delays may be about to become just a little more bearable.

Compare Travel Insurance - 5 day Euro cover from £4.33 and Annual worldwide policies from just £43.08