Published on Friday, February 1, 2013
Ryanair has warned air fares will have to rise to cover the cost of compensating passengers whose flights were grounded due to the ash cloud in 2010.
The European Court of Justice (ECJ) yesterday ordered Ryanair to compensate passenger Denise McDonagh, who was forced to wait seven days for a flight from Faro to Dublin,a delay during which she spent nearly £1000 on accommodation, food and transport.
Her compensation will be decided by the Irish courts. Her case had been referred to the ECJ by the Dublin Metropolitan District Court, which had sought clarification of EU law.
The ECJ said Ms McDonagh was entitled to "reimbursement of the amounts which proved necessary, appropriate and reasonable to make up for the shortcomings of the air carrier".
Ryanair had attempted to avoid covering the costs of passengers affected by the ash cloud by arguing that the eruption of Iceland's Eyjafjallajokull volcano was so extraordinary that normal rules relating to cancelled flights should not apply.
However, the judges' ruling - which will be binding across the EU - said that in such circumstances airlines had a duty to look after their passengers.
The EU regulation on passenger rights "does not provide for any limitation, either temporal or monetary, of the obligation to provide care to passengers whose flight is cancelled due to extraordinary circumstances", the ECJ said.
"Thus, all the obligations to provide care to passengers are imposed on the air carrier for the whole period during which the passengers concerned must await their re-routing."
In a statement, Ryanair said the ruling would lead to significantly higher fares for all passengers. In a statement it said: "Ryanair regrets the decision of the European Court which now allows passengers to claim for flight delays which are clearly and unambiguously outside of an airline's control.
"When governments closed large swathes of European airspace unnecessarily in response to non-existent 'ash clouds' over Ireland the UK and continental Europe in 2010, the travel insurance companies escaped liability by claiming it was an 'act of God'.
"Today's ruling by the European Court now makes the airlines the insurer of last resort even when in the majority of cases (such as ATC delays or national strikes in Europe) these delays are entirely beyond an airline's control.
"Today's decision will materially increase the cost of flying across Europe and consumer airfares will increase as airlines will be obliged to recover the cost of these claims from their customers, because the defective European regulation does not allow us to recover such costs from the governments or unions who are responsible for over 95% of flight delays in Europe."
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The recent insolvency of Low Cost Travel Group, one of the large players in the travel industry had a big impact on the travelers, hotels and all related players from both wholesale & retail arms. There were about 27,000 people on a holiday who had booked through the company comprised of a €200 million wholesale arm and €500 million OTA / retail arm.