The European Commission has set October 2007 as the deadline for airline companies and member states to implement in full the Air Passenger Rights Regulation of 2004. This regulation establishes a common set of rules on compensation and assistance to passengers left "stranded" at airports due to cancellation of flights or long delays. The deadline was set after the Commission conducted an evaluation exercise into the way the regulation is being currently put into practice by the member states of the EU.

The Commission acknowledges in its study that some progress has been made since the regulation's adoption but airlines are still failing to apply the regulation's rules consistently and in line with its spirit.

The regulation offers specific rights to passengers travelling on all domestic and international flights originating from any airport in the EU, irrespective of the place of establishment of the airline company. For instance, Air Canada would be bound by the regulation's provisions if one of its planes took off from an Italian airport.

The place of establishment of the airline company becomes relevant when passengers fly from a third country into the EU: In these cases, only European airlines are bound by the provisions of the regulation.

Any type of flight, including low-cost, scheduled and non-scheduled flights, fall under the purview of the EU regulation. Passengers denied boarding because, for example, of overbooking, have a choice between the right to cancel their flight and a reimbursement of their tickets, or alternatively to continue their journey by taking a later flight, provided the airline company makes up for the inconvenience by offering satisfactory conditions, which may include free meals or refreshments and/or hotel accommodation. Passengers facing cancelled flights have also been accorded specific rights under the regulation. Airlines are in duty bound to inform passengers of any cancellations before the scheduled time of departure and to offer passengers the choice of either compensation or alternative transport for their destination. Cancellations due to extraordinary circumstances falling outside the control of the airline company will not give rise to compensation. Moreover, if the airline gives passengers at least two weeks' notice or provides an alternative flight close to the one cancelled, passengers would not be entitled to compensation.

In specific circumstances, passengers also have a right to monetary compensation, which must be paid immediately by the airline. Such compensation varies between €250 and €900 depending on the distance to the final destination.

In its study, the Commission notes that although stranded passengers now have specific rights, they are still far from obtaining the full benefits of the regulation. Airlines often do not inform passengers about their rights when their flights are disrupted, even though the regulation obliges them to do so. Thus passengers are unable to assert their rights.

The Commission will be intensifying its work in the coming months in order to improve enforcement of the regulation. Should member states still default in implementing the regulation in full, the Commission is threatening to initiate infringement procedures.

Once fully implemented, the regulation will greatly benefit passengers by ensuring protection of their rights when travelling and guaranteeing them good service from airlines. Liberalisation of air transport with its concomitant low fares and wide choice of carriers is beneficial to consumers only to the extent that passengers' interests are respected.

• Dr Grech is an associate with Guido de Marco & Associates and heads its European Law division.

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