Canada’s Airlines Don’t Like The New Consumer Protection Laws And Seeking To Quash Them In Appeals Court

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Two months after the Canadian government announced the implementation of sweeping passenger rights laws, Canada’s airlines are having none of it and calling on the Court of Appeals to quash them.

The Canadian Transportation Agency announced on May 24th that a set of new regulations will take effect between July 15 and December 15, 2019.

According to media reports, 19 applicants are seeking relief from the Canadian Court of Appeals one week before the first part of new passenger right legislation is on course to come into effect.

As CTV News (access here) reported the applications filed last Friday reveal some very, let’s say “interesting” positions by the airlines and IATA as far as the new regulations are concerned.

Canadian airlines are among hundreds of carriers asking the Federal Court of Appeal to quash new rules that beef up compensation for passengers subjected to delayed flights and damaged luggage.

Air Canada and Porter Airlines Inc., along with 17 other applicants that include the International Air Transport Association — which has some 290 member airlines — state in a court filing that required payments under the country’s new air passenger bill of rights violate international standards and should be rendered invalid.

The court application argues the new provisions contravene the Montreal Convention, a multilateral treaty, in part by setting compensation amounts based on the length of the delay and “irrespective of the actual damage suffered.”

The application, filed last Friday, also says nullifying the regulations “would avoid the confusion to passengers” who could be subject to travel regimes from multiple jurisdictions on international flights. …

John McKenna, who heads the Air Transport Association of Canada, called the compensation grid “very high” and the new rules “outrageous.”

“They’re trying to meet international standards and do better, and I don’t see why. We’ve been complaining about that from the start, that this is going to drive up the price of flying in Canada,” he said from Portugal. …

The application for judicial review also argues the distinction between large and small carriers — defined by annual passenger numbers and bearing on compensation amount owed — amounts to “differential treatment…without any statutory authorization for such discrimination.”

The Canadian Transportation Agency said it will respond with a court filing by July 8, but declined to comment on the case.

I wasn’t able to find any current court filings with the Federal Court of Appeals and relevant amicus briefs in this matter but sooner or later they will probably surface.

As we previously reported the new rules are sweeping and punish airlines for a variety of misconduct against passengers:

Beginning July 15, 2019, airlines will have to:

  • communicate to passengers in a simple, clear way information on their rights and recourses and regular updates in the event of flight delays and cancellations;
  • provide compensation of up to $2,400 for bumping a passenger for reasons within their control;
  • ensure passengers receive standards of treatment during all tarmac delays and allow them to leave the airplane, when it’s safe to do so, if a tarmac delay lasts for over three hours and there’s no prospect of an imminent take-off;
  • provide compensation for lost or damaged baggage of up to $2,100 and a refund of any baggage fees; and
  • set clear policies for transporting musical instruments.

Beginning December 15, 2019, airlines will have to:

  • provide compensation of up to $1,000 for flight delays and cancellations within an airline’s control that are not safety-related;
  • rebook or refund passengers when flights are delayed, including, in some cases, using a competing airline to get passengers to their destination;
  • provide food, drink and accommodation when passengers’ flights are delayed; and
  • facilitate the seating of children under 14 years in close proximity to an accompanying adult, at no extra charge.

Airlines and their representatives are calling the new rules discriminatory and argue that passengers might be confused by the new consumer rights laws so nullifying them would actually benefit the passenger. You certainly have to give them points for creativity in this discussion.

Conclusion

Let’s see if the courts will grant a stay or issue another type of injunction in favor of the applicants in this case. Naturally the airlines and their representatives such as professional associations (ATA, IATA) are against, it as they’ve been taking advantage of customers in Canada for decades, mostly without serious ramifications due to lack of legislation punishing carriers for overbookings, delays, denied boardings and similar customer service lapses.

Keep in mind the European Union has strong passenger rights legislation in place since 2004 and this rule, commonly known as EC261/2004 or “EU Compensation”, has helped reigning carriers in to compensate passengers per a fix table based on type of delay/damages and individual time thresholds. This legislation has been upheld by European courts and arguing a contravention of the Montreal Convention hasn’t been successful there either. I doubt the Canadian Court of Appeals will follow this line of argument.

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