Feb. 16 (Bloomberg) -- European Union regulators proposed to blacklist EU airlines with poor safety records in a draft law that would also require tour operators such as TUI AG to disclose the carriers booked for customers.

The passenger-rights legislation unveiled by the European Commission today in Brussels would also prohibit airlines from denying reservations or boarding to handicapped or old people and give these travelers the right to free assistance in airports and on planes. The two laws need the approval of the European Parliament and national governments.

The proposals supplement 2004 EU laws that allow for the blacklisting of non-European planes that fail safety inspections and increase compensation to passengers for denied boarding and cancellations. The airline industry has filed lawsuits against the compensation rules, which enter into force tomorrow.

``The boom in air travel needs to be accompanied by proper protection of passengers' rights,'' EU Transport Commissioner Jacques Barrot said at a press conference. ``Competitiveness and competition in the air sector go hand in hand with guaranteed passengers' rights.''

The plan to widen the blacklisting of airlines and force tour operators to identify carriers results from the January 2004 crash into the Red Sea of an Egyptian charter plane bound for Paris. At least some of the 148 mainly French passengers and crew killed on the Flash Airlines flight weren't informed of the airline with which they would be flying and didn't know that Switzerland had banned the Boeing Co. 737-300 plane they were on because of safety concerns.

Greater Authority

The accident hastened approval of a law that boosts national cooperation over inspections on non-EU aircraft and lets the commission, the EU's regulatory arm, recommend Europe-wide bans and publish an annual report on the safety of foreign aircraft.

Today's proposal would extend the list of unsafe planes to European airlines and ensure regular updates of it, said Stefaan De Rynck, a commission transport spokesman.

The draft law on ``persons with reduced mobility,'' who account for about 10 percent of the 25-nation EU's population, would make airports responsible for providing assistance at the expense of airlines. The cost for wheelchair passengers would be as much as 30 euros ($39) per one-way journey, the commission said in a report.

U.K. Court Ruling

Ryanair Holdings Plc, Europe's biggest low-cost carrier, and BAA Plc's Stansted Airport in the U.K. unlawfully discriminated against disabled passengers by failing to ensure that wheelchairs were provided for free, a British court ruled in December. Earlier in the case, Ryanair was ordered to pay 1,336 pounds ($2,520) in damages to a disabled passenger.

Barrot said the proposed law would help prevent litigation and the resulting costs for airlines by offering a better legal framework.

The Brussels-based Airports Council International Europe, which represents more than 450 airfields, said in a statement the proposal was welcome because it would ``unequivocally outlaw discriminatory practices by airline companies against passengers with disabilities.''

The draft EU law follows approval last year of legislation that raises compensation for travelers stranded because of overbooked or canceled flights to between 250 euros and 600 euros from a maximum 300 euros.

Groups representing full-service airlines such as British Airways Plc and low-cost carriers including Ryanair last year asked the U.K. High Court to start a judicial review of the legislation, saying it's unfair.

The commission says air passengers' interests need to be protected by measures going beyond the market opening that has led to a greater choice of carriers and lower fares. In 2002, about 250,000 air passengers were denied boarding in the then 15- member EU, it says.

The commission last year proposed a separate law on rail- passenger compensation and is examining similar measures for ships and buses.

To contact the reporter on this story: Jonathan Stearns in the Brussels bureau at jstearns2@bloomberg.net

Last Updated: February 16, 2005 08:48 EST