European politicians are at a stalemate over passenger rights and are struggling to reach an agreement over a revamp of these rules. European Regions Airline Association Director General Montserrat Barriga explains what this means for airlines and digs into the key issues and sticking points.
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Victoria Moores: Hello everyone, and thank you for joining us for Window Seat, our Aviation Week Air Transport Podcast. I'm Air Transport World European and Africa Bureau Chief Victoria Moores, and I'm delighted to welcome you on board. I'm joined this week by Montserrat Barriga, who is the Director General of the European Regions Airline Association. And we're going to have a conversation today about European passenger rights rules, which are currently subject to revision, and that discussion is going on in the European institutions at the moment. Welcome, Montserrat.
Montserrat Barriga: Thank you, Victoria. Thank you very much, Aviation Week, for inviting me to speak today.
Victoria Moores: So Montserrat, maybe we should start with a bit of context about ERA itself, which is the association that you are representing and heading. So ERA represents Europe's regional airlines that provide a lot of the connectivity across Europe that is really important to the ethos of being European in the first place. It's about connecting the regions and having the mobility of people and goods. And those airlines provide vital lifelines to various communities across the bloc. With that in mind, that's a perspective that you're bringing to the discussion about these essential air links. We're in a situation at the moment where the European institutions are looking to revise passenger rights rules. So the regulations that we have in place right now took effect in 2005. And what they do is they protect European airline passengers and passengers flying to and from Europe from lengthy delays, from cancellations, and from being denied boarding onto flights.
And the regulation itself is called EU261. Now, that led to some unintended consequences with airlines being liable for unlimited care and assistance in the event of extraordinary circumstances that were beyond their control. So the classic example of that was the Icelandic volcano, where airlines were not allowed to fly for safety reasons, but they had to pay for unlimited care and assistance. So that brought us to the situation that we're in today after lots of discussion over the years where there is a revision coming through. And so I'm curious to check in with you, Montserrat, about where we're up to in that process.
Montserrat Barriga: Yes, Victoria, you're absolutely right. The regulations started to be fully implemented in 2005. And since then, on many occasions, the airlines have been saying that this regulation is not fit for purpose. It's very important to highlight that it's the piece of regulation that has been most contested in the European Court of Justice. This means that neither the airlines nor the passengers were happy with the regulation because both parties were going to the European Court of Justice as the mediator to produce court rulings and rule about the outcome of the negotiations between the airlines and the passengers. But because the regulation was not clear, it went so many times to the European Court of Justice. It was contested in the tribunals so many times, thousands and thousands of times, that the European Court of Justice has been interpreting and reinterpreting and reinterpreting. And the initial scope and purpose of the regulation has nothing to do with what it has become today.
So that's why the airlines really pushed to have this piece of regulation revised as soon as possible. There was a proposal from the European Commission in 2013. In the last few years, since that proposal, the airlines have very much supported the majority of the content of the proposal from the commission, which included things like the extension of the threshold to trigger compensation or the rerouting obligations were softened for the airlines. And it had some other elements such as, as you mentioned, the limitation of the care and assistance because there were quite a few abuses and the clarification of what extraordinary circumstances mean. And all these points are very important. Maybe we can go into some of the details of some of these, but the airlines tried to bring real case studies to the commission to be able to produce that proposal, which they did.
And now we are in 2026 in the middle of a political battle between the European Parliament and the European Council, which both have very different positions, but also very different from what the commission and from what the industry really supports.
Victoria Moores: You mentioned the commission there and the regulatory process. So for our global listeners, the process of rulemaking within Europe is that the commission drafts the regulations. They then go through a process which involves the European Council, which represents the member states of the European Union, and also the European Parliament, which represents the citizens of Europe. And what we are experiencing at the moment is that the commission proposed that regulation, the revised regulation, but the parliament and the council are disagreeing on the content of the regulation, and that agreement is needed to get the process moving through. What are the main sticking points, Montserrat, between the council and the parliament?
Montserrat Barriga: There were several items. There are discussions around, for example, the threshold, the delay threshold. So the commission in 2013 proposed five hours to give the airlines more time to perform all their maintenance work and all the additional jobs that need to be done before the airline can take off. The current threshold is three hours, which is very tight. It's very tight, and it's very tight, I would say, especially for regional airlines that have, for a number of reasons, fewer aircraft and especially fewer spare aircraft and often fly into remote destinations. So that makes it really tricky for them. So from three hours to five hours in the commission, the council, as you say, the representation of the member states of the European Union, they propose four hours, which could be a good solution, for sure, better than three. And the parliament has reiterated their willingness to not touch those thresholds.
So they kept three hours regardless of the distance of the journey.
Victoria Moores: And that's one of the things that has happened recently. So on the 21st of January, we saw that the parliament came to a fresh vote on their position and they are standing by very strongly their position of this minimum three-hour delay. And it's really unusual to see the parliament in such strong agreement. Ninety-seven percent of them backed that proposal, which is quite different from the council position. So what happens next? In terms of the...
Montserrat Barriga: Political process, the parliament has now voted, has just voted an official second reading position in the plenary. And now the process means that the text will need to go to the council, back to the council of the EU, and they have three plus one months to amend the text. So more negotiations will happen between the council and the parliament. If there is no agreement between them, there will be a conciliation committee. We expect the conciliation committee. It's quite rare, but I mean, we are in that circumstance where the council will have to deliver an opinion on the parliament text. And if the positions continue to be very different, the conciliation will be triggered. And we heard that the process will be chaired jointly by the president of the European Parliament, Roberta Metsola, and then the deputy permanent representative of Cyprus. And why Cyprus? Because Cyprus holds the presidency of the council at the moment.
Victoria Moores: Alongside this discussion about whether the delay period should be three hours or four hours before compensation kicks in, there's also been a real push from the European Parliament to introduce a new aspect of the regulation, which is about hand luggage. And I understand that airlines have been reacting quite strongly to the idea that commercial decisions around what you charge for beyond basic hand luggage, that's something that they really don't want to have changed right now.
Montserrat Barriga: No, absolutely not. I mean, there needs to be, that means too much interference from the institutions in the commercial freedom of the airlines. As you know, all the airlines, there are many different business models and all the airlines may be free to decide what is the best business model that would suit their operations and their commercial activities. The industry does not want a standardization of the dimensions, or in any case would have to be based on the smallest aircraft dimensions, because to be able to come up with a dimension that suits every single aircraft, it's impossible. It also will mean the end of really cheap travel or really affordable travel for citizens. My members mainly compete with the low-cost carriers, but the low-cost carriers have that business model that they have a basic fare and then they charge for all the ancillaries, including hand luggage.
And most of my members, they're regional operators, most of them have their hand luggage included as part of a fee, but not everybody, not everybody. Some decide not to, and rightly so, because there should be commercial freedom. So if the institutions impose a mandatory carry-on luggage within the fee, then prices are going to be going up and there will be less choice, that's for sure.
Victoria Moores: So in terms of the proposals that we're looking at the moment from the council and the parliament, what kind of compensation could airlines be looking at having to pay in the event of cancellation, long delays, denied boarding, Montserrat?
Montserrat Barriga: The European Parliament is looking at increasing the threshold from 250 to 300 euros in the short distances and 400 medium haul, 600 long haul. This means it will be, again, more expensive for airlines to pay the passengers, and it's across the board for everybody. I think it's 50 euros more for short-haul distances taken into consideration that a lot obviously for the price of the ticket is lower in short distance, and some of them are public service obligations, which are subsidized routes because of lack of connectivity. Some operate to islands or archipelagos. So it means that this is going to create an issue for those airlines that operate short-haul flights. And it's across the board for everybody. There's no proportionality. So I think that's important. All the modes of transport actually recognize the proportionality of the price that the passenger has paid or the delay that the passenger has suffered.
So there is a correlation between the compensation and the actual reality of the passenger. Whilst in the case of the proposal from the parliament and the council, it's a one size fits all, which is not suitable.
Victoria Moores: On that subject of the idea of one size fits all, obviously there's a great deal of variation in business model, in charging structures, in the way that airlines run their business. Whereas it seems to be that this is when we're talking about the hand luggage, when we're talking about the compensation, it's looking to make that quite fixed in a way that exceeds potentially the fare that an airline passenger has paid in the first place and also doesn't take account of the different shapes and sizes of those business models in the first place, particularly for your members.
Montserrat Barriga: Absolutely. Regional airlines provide all year round essential connectivity, not just connections in the summer or all in the high season. And my members operate all regions, including those very remote or isolated islands, archipelagos, and they provide feeder services into larger hubs for those areas of Europe that are not connected by other modes of transport. But for aviation, they operate approximately a thousand unique routes, routes that are not operated by anybody else. So they're really key actors in the social and economic development of the regions, connecting passengers to essential services, as you said, healthcare, education, business opportunities. And they typically use smaller aircraft and operate with lower margins because they have smaller fleets. Obviously they don't have the economies of scale. And they're also key actors in the sustainable transition. So all these elements make it very, very important for this regulation to take into consideration the specific needs of regional airlines.
I understand that the intention of the parliament is good, is sound. They want to protect the passengers, but they don't realize that by doing this, they may actually be encouraging cancellations. They may be encouraging airlines to stop flying certain routes because they don't become profitable at some point. And in the particular circumstance of the regional airlines, EU261, that's the technical name of the file EU for the European Union in 261. And 2004, the year was approved. They serve communities. So they make strong efforts to avoid cancellations to the destinations. They really prioritize connectivity versus punctuality, especially when there are no other modes of transport available, like for example, in islands, and they face higher difficulties with rerouting options. And because they have limited access to maintenance facilities apart from their home base and fewer spare aircraft. So the economic impact is going to be very significant on them.
And we have seen bankruptcies in the last 10 years, we've seen at least 20 airlines going bankrupt, small airlines, independent regional airlines, and that will mean less choice. Maybe Europe in a few years' time will go towards more the American market model where you have few airlines operating and prices are really high. In Europe, we still benefit from the choice and from very affordable prices for flying. And that's something that we are raising awareness with the European Parliament and with the council, they need to take this into consideration. If they make it really onerous and punitive for the airlines, then they may be causing unintended consequences into connectivity and reducing options and choice for passengers.
Victoria Moores: Yeah, absolutely. And we've heard from IATA as well, because this isn't just a European topic because it impacts all airlines flying into and out of Europe as well as within Europe. And we've heard from IATA a warning that basically these new regulations could be much worse rather than improved and that it could have unintended consequences on passengers of more cancellations. And people would typically prefer to be delayed than to have their flight canceled altogether. And yet we find ourselves in this stalemate between the parliament and the council on what to do about this issue, about how they're going to revise the rules. And Montserrat, I'm curious about what might come now in terms of are airlines likely to see any changes to the regulation at this stage, or is it literally a case of waiting to see what those policymakers come up with as their final decision?
Montserrat Barriga: Yes. Obviously there is advocacy work and work being done amongst the different parties. So we are as an association together with other industry players, like you mentioned, IATA, also Airlines for Europe. We are working together to make sure that the institutions understand the consequences. And we as a regional airline association, we are bringing those arguments to explain that they need to take into consideration the damage it may cause to the industry. So the work hasn't finished yet. We need to raise ... We are talking to them, we're talking to the MEPs, we're talking to the representatives of the council, and I know our members are also doing a lot of efforts in talking to their national representatives to explain to them what the consequences could be. If I may, I would like to raise awareness about other compensation regimes in other parts of the world.
And I think that's something very important to let our regulators in Europe know that there are other models in other parts of the world. And the European is the most onerous, the most difficult for airlines. If you look at, for example, the Canadian system, they have a two-tier approach, which actually in the regulation, it is explained very well that it aims to strike a balance between robust passenger protection, but also preserve the viability of small carriers, many of which serve remote communities to ensure that the air travel remains accessible for Canadians. And that's exactly what we are asking for. So I think our role is very important because we are just raising this awareness amongst all the stakeholders for them to have all the information when they take a decision.
Victoria Moores: And it sounds as though we might be waiting up to another four months to see what happens with this impasse between the council and the parliament and what rules we see coming out of this for European airlines and airlines flying to and from Europe at the end of the process. That's all we've got time for today. So I would like to thank you, Montserrat, for joining us on the show today. And also thank you to our producers, Guy Fernyho and Corey Hitt. And of course, a huge thank you to our listeners for following Window Seat. Make sure you don't miss us each week by subscribing to The Window Seat Podcast on Apple Podcasts or wherever you listen. This is Victoria Moores disembarking from Window Seat.
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