Research publications

Contents

• 1 Introduction
• 2 International Conventions
• 3 Air Passenger Rights in Canada
  • 3.1 Existing Rights
  • 3.2 Bill C‑49
• 4 Air Passenger Rights in the United States
  • 4.1 Denied Boarding
  • 4.2 Flight Delays and Cancellations
  • 4.3 Tarmac Delay
• 5 Air Passenger Rights in the European Union
  • 5.1 Denied Boarding
    • 5.1.1 The Right to Compensation
    • 5.1.2 The Right to Reimbursement, Rerouting or Rebooking the Flight at a Later Date
    • 5.1.3 The Right to Assistance
  • 5.2 Flight Delays and Cancellations
  • 5.3 Tarmac Delay
• 6 Air Passenger Rights in Australia
• 7 Conclusion
• Notes
• Appendix A – Summary Table

1  Introduction

There have been many media reports in recent years about Canadian airline passengers being denied boarding, having their flights delayed or cancelled, or having to wait hours on the airport tarmac before take‑off.1 These reports suggest that passengers are often unsure about their rights in such situations.

Bill C‑49, An Act to amend the Canada Transportation Act and other Acts respecting transportation and to make related and consequential amendments to other Acts (short title: Transportation Modernization Act),2 would require the Canadian Transportation Agency (the Agency) to make regulations on air passenger rights. Such rights have existed in the United States (U.S.) and the European Union (EU) for a number of years.

This Background Paper provides an overview of relevant international conventions in relation to air passenger rights and describes air passenger rights regimes in Canada, the U.S., the EU and Australia, respectively. For the U.S. and the EU – the two jurisdictions with legislated regimes – the focus is on the rights available to consumers in terms of denied boarding (i.e., overbooking); flight delays and cancellations; and tarmac delays (i.e., waiting on board an aircraft).3

2  International Conventions4

The 1999 Convention for the Unification of Certain Rules for International Carriage by Air (commonly known as the Montreal Convention) establishes the rules governing air carrier liability for the international carriage of passengers, baggage, and cargo.5 The Montreal Convention modernized the 1929 Convention for the Unification of certain Rules Relating to International Carriage by Air (Warsaw Convention).6 A jurisdiction may be a party to one, both or neither of the two conventions.

The Montreal Convention applies to air travel between two or more of the 131 parties to the convention, including all of the jurisdictions discussed in this Background Paper.7 The Warsaw Convention may still apply in countries that have not signed the Montreal Convention.8 In countries that have ratified neither convention, air carriers can establish their own liability limits.

Under the Montreal Convention, air passengers are entitled to compensation when they incur damages related to international flights, expressed in Special Drawing Rights (SDRs), an international reserve asset that was created by the International Monetary Fund in 1969 to supplement its member countries' official reserves.9 The SDR is updated daily and as of 28 February 2018, one SDR was worth C$1.85.10

The Montreal Convention establishes the liability limits of the air carrier for damages in relation to the carriage of passengers, baggage and cargo. The International Civil Aviation Organization must review these liability limits every five years to determine if they need to be adjusted for inflation. The latest review was conducted in 201411 and the maximum levels of liability were established as follows:

• a limit of 19 SDRs per kilogram in the case of destruction, loss, damage or delay in relation to the carriage of cargo (or C$35.15 per kilogram, based on the SDR in effect on 28 February 2018);
• a limit of 1,131 SDRs per passenger in the case of destruction, loss, damage or delay with respect to baggage (C$2,092.35 per passenger); and
• a limit of 4,694 SDRs per passenger in relation to damage caused by delay in the carriage of persons (C$8,683.90 per passenger).

3  Air Passenger Rights in Canada

3.1  Existing Rights

Canada does not have a legislated air passenger bill of rights at present, although Bill C‑49 may change that situation if it receives Royal Assent.12 Nevertheless, other Canadian laws and regulations do contain provisions related to air passenger rights.

Firstly, Canadian regulations require all persons who advertise the price of an air service to show the total price, including all fees, charges and taxes.13

While carriers operating in Canada may set their own terms and conditions for air carriage – subject to the terms of the Warsaw and Montreal Conventions14 – they must also create and publish documents, referred to as “tariffs,” that set out those terms and conditions of their service.15 Among other things, these tariffs must include an airline's service commitments to passengers in cases of denied boarding due to overbooking (also known as “bumping”); flight delays and cancellations; and tarmac delays.16

The Canadian Transportation Agency can help passengers resolve complaints about air travel within, to and from Canada. Specifically, the Agency's role is to ensure that the airline has properly applied its tariff and to determine whether or not the tariff's terms are reasonable.17

Finally, the Agency offers an informal facilitation or mediation process to resolve passenger complaints. If that process is unsuccessful, it offers a formal adjudication process.18

3.2  Bill C‑4919

The Minister of Transport introduced Bill C‑49 in the House of Commons on 16 May 2017. It requires the Agency to establish a new air passenger rights regime through regulations, which will apply to flights to, from and within Canada, including connecting flights. These rights will be deemed to be part of the carrier's tariff.

Such an air passenger rights regime must include the following obligations on the part of carriers towards passengers, among others:

• the obligation to make certain information, such as the terms and conditions of carriage, readily available to passengers in plain language;
• the obligations in case of bumping, flight delay or flight cancellation; and
• the obligation to facilitate the assignment of seats to children under the age of 14 in close proximity to a parent or guardian at no additional cost.

On 30 January 2018, the Agency told the Standing Senate Committee on Transport and Communications that it would start a three‑month consultation on the regulations within three days of the bill being assented to.20

4  Air Passenger Rights in the United States21

Air passenger rights in the U.S. are derived from regulations and legislation adopted in recent years: three versions of the Enhancing Airline Passenger Protections final rule (which came into effect in 2009,22 201123 and 2016,24 respectively), as well as the FAA [Federal Aviation Administration] Extension, Safety, and Security Act of 2016.25

4.1  Denied Boarding26

According to the U.S. Department of Transportation (DOT), an airline must first seek passengers who will give up seats voluntarily for compensation when a flight is overbooked. Compensation may include money, vouchers, and/or a reduced rate (or even free) ticket for another flight.27 There is no limit to the compensation that the airline may offer to a passenger, and passengers can negotiate with the airline.

If there are no (or not enough) volunteers willing to give up their seat on an overbooked flight, airlines can select passengers to give up their seats and fly on another flight. Airlines can determine their own criteria for bumping passengers, but those criteria cannot subject a passenger to any unjust or unreasonable prejudice or disadvantage.28 Airlines must give bumped passengers a written statement outlining those criteria and describing the passengers' rights.

Passengers who are denied boarding involuntarily are eligible for compensation if the following conditions apply:

• they have a confirmed reservation;
• they check into their flight on time;
• they arrive at their departure gate on time; and
• the airline cannot get them to their destination within an hour of their flight's original arrival time.

However, in certain circumstances, passengers are not eligible for compensation. For example, compensation is not mandatory if the flight is arriving in the U.S. from a foreign destination (i.e., on international flights to the U.S.).

Table 1 summarizes the amount of compensation to which eligible passengers departing the U.S. may be entitled according to the length of delay in arriving at their destination and the type of flight (domestic or international).

4.2  Flight Delays and Cancellations

The U.S. DOT states that “[t]here are no federal laws requiring airlines to provide passengers with money or other compensation when their flights are delayed.”29 For significant delays, the department indicates that, in certain cases, passengers “may be entitled to a refund, including a refund for all optional fees associated with the purchase of your ticket.”30 However, the U.S. DOT does not define what constitutes a “significant” delay.

In the case of cancellations, most airlines will book passengers at no charge on the next available flight, when seats are available. However, if a passenger cancels his or her trip because of a cancelled flight, the U.S. DOT notes that the passenger is “entitled to a refund for the unused transportation – even for non‑refundable tickets.”31

4.3  Tarmac Delay

For flights departing from an American airport, airlines must “begin to move the airplane to a location where passengers can safely get off before three hours for domestic flights and four hours for international flights.”32 A similar requirement of three hours for domestic flights and four hours for international flights also exists for flights arriving at an American airport. There are exceptions to these time limits for reasons of safety, security or air traffic control.

Airlines are also required to provide passengers with a snack and drinking water no later than two hours after the aircraft leaves the gate (when departing) or touches down (when arriving). Airlines must also provide passengers with working toilets, comfortable cabin temperatures and adequate medical attention (if needed).

5  Air Passenger Rights in the European Union33

Regulation (EC) No 261/200434 governs air passenger rights in the EU. It establishes rules on compensation and assistance provided to passengers in cases of denied boarding, flight delays and cancellations. The regulation applies to the following:

• flights within the EU, operated by an EU or a non‑EU airline;
• flights arriving in the EU from outside the EU, where an EU airline operates the flight; and
• flights departing from the EU to a non‑EU country, operated by an EU or a non‑EU airline.

As a result, a Canadian airline may be subject to the regulation when operating a flight to Canada from an EU member state.

5.1  Denied Boarding

According to the EU regulation, before bumping passengers, airlines must first seek passengers who are willing to give up their seats in return for compensation.

If an airline denies a passenger the opportunity to board the plane due to overbooking or for operational reasons and the passenger does not voluntarily give up her or his seat, that passenger has three main rights:

• the right to compensation;
• the right to choose between reimbursement, rerouting or rebooking the flight at a later date; and
• the right to assistance (such as food and accommodation).

To qualify for these rights, the passenger must be on time for check‑in and have a valid flight reservation and travel documentation.

5.1.1  The Right to Compensation

In accordance with Regulation (EC) No 261/2004, the amount of compensation allowed to passengers on EU flights (as defined above) is based on flight distance. Table 2 shows the required amount of compensation when an airline bumps passengers.

5.1.2  The Right to Reimbursement, Rerouting or Rebooking the Flight at a Later Date

When an airline denies boarding to a passenger, that airline must also offer the passenger a choice between the following options:

• reimbursing the passenger's ticket and a return flight to the airport of departure at the earliest opportunity (if the passenger has a connecting flight);
• rerouting to the passenger's final destination at the earliest opportunity; or
• rebooking the passenger for a rerouted flight at a later date, chosen at the passenger's convenience, under comparable transport conditions (subject to the availability of seats).

5.1.3  The Right to Assistance

When an airline denies boarding to a passenger, it must assist that passenger free of charge. This assistance includes the following:

• food and other refreshments;
• accommodation (if the passenger is rebooked to travel the next day);
• transport to and from that accommodation; and
• two telephone calls, fax messages or emails.

If an airline does not provide assistance to a passenger, the airline must reimburse any necessary, reasonable and appropriate costs that the passenger has incurred as a result of the denied boarding.

5.2  Flight Delays and Cancellations

If a flight delay causes a passenger to arrive at his or her destination over three hours late, the passenger is entitled to compensation (see amounts for denied boarding in Table 2). It should be noted that the right to compensation does not apply in certain extraordinary circumstances, such as adverse weather conditions.

As is the case with passengers denied boarding, passengers whose flight is delayed also have the right to have their ticket reimbursed and the right to a return flight to their original airport of departure. They also have a right to assistance. These rights depend on the delay's duration and the distance of the flight.

For cancelled flights, passengers are entitled to the same rights as passengers who are denied boarding due to overbooking or for operational reasons (see above). In general, the right to compensation for a cancellation applies when the airline informs the passengers of a cancellation less than 14 days before the scheduled departure. There are some exceptions to this 14‑day rule,35 and the right to compensation does not apply in certain extraordinary circumstances, such as adverse weather conditions.

5.3  Tarmac Delay

In the case of a tarmac delay, the European Commission (EC) stipulates that passengers have a right to assistance and a right to renounce the flight after five hours' delay.36 A 2013 EC proposal suggested amending Regulation (EC) No 261/2004 to make those rights more explicit, but it has not yet been implemented.37

6  Air Passenger Rights in Australia38

Australia does not have air passenger rights spelled out in legislation like the U.S. or the EU. According to the Australian consumer advocacy group CHOICE, the country decided not to implement such a regime because of concerns about how it would affect airfares.39

However, Australia's Airline Customer Advocate (ACA) “provides a free and independent service to eligible customers of major Australian airlines by facilitating the resolution of current unresolved complaints about airline services.”40 The five participating airlines fund the ACA.41

To be eligible to file a complaint with the ACA, the complaint must be about a specific incident (e.g., a flight delay or cancellation) and the passenger must have already tried to resolve the complaint directly with the airline.42 The complaint must also relate to a problem that has occurred in the last 12 months.43

The ACA will respond to the passenger's complaint within 20 days of the date that they lodged the complaint, although the organization can extend this deadline when it needs to seek more information from the passenger. Airlines must respond to all complaints that the ACA forwards to them.44

Nevertheless, the ACA maintains that it “does not have independent power to make decisions that affect the participating airline's response to [a] complaint.”45 In other words, the ACA cannot make the airline respond in a particular way.

Compared to Canada, the ACA's role most resembles the Canadian Transportation Agency's facilitation process; however, in contrast to the ACA, the Agency also offers an adjudication process, where its decision is final and binding.

Australian airlines are free to set their own policies regarding such matters as denied boarding, flight delays, cancellations and tarmac delays. These policies are typically available through the airlines' customer charters (referred to as tariffs in Canada).

7  Conclusion

Currently, Canada's air passenger rights regime is most similar to Australia's, as both jurisdictions allow airlines to set their own policies on air passenger rights and require them to publish those policies in their tariffs (or customer charters). Both countries also have dispute resolution processes in place, though the Canadian Transportation Agency has more enforcement power than its Australian counterpart.

In contrast, the U.S. and the EU both have legislated air passenger rights in cases of denied boarding, flight delays, cancellations and tarmac delays, even if the specific rights in each jurisdiction varies.

If Bill C‑49 becomes law, the Canadian Transportation Agency will be required to establish a new air passenger rights regime through regulations, bringing Canada more in line with the regulatory frameworks in place in the U.S. and the EU.

Table A.1 in Appendix A summarizes the four air passenger rights regimes covered in this Background Paper.

Notes

†  Library of Parliament Background Papers provide in-depth studies of policy issues. They feature historical background, current information and references, and many anticipate the emergence of the issues they examine. They are prepared by the Parliamentary Information and Research Service, which carries out research for and provides information and analysis to parliamentarians and Senate and House of Commons committees and parliamentary associations in an objective, impartial manner.  [ Return to text ]