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Ryanair May Have to Compensate Passengers in Volcano Delays

Ryanair May Have to Compensate Passengers in Volcano Delays
A Boeing 737 aircraft, operated by Ryanair Holdings Plc, waits on the tarmac as another prepares to land at Dublin Airport in Dublin. Photographer: Aidan Crawley/Bloomberg

March 22 (Bloomberg) -- Ryanair Holdings Plc, Europe’s biggest discount carrier, should pay for passengers’ hotels, meals and transport if a volcanic explosion grounds flights, an aide to the European Union’s top court said.

EU law requires airlines to provide care for passengers stranded by “extraordinary circumstances,” and the eruption of an Icelandic volcano in April 2010 that closed European airspace qualifies as such an event, according to a non-binding opinion by an adviser to the EU’s Court of Justice in Luxembourg.

Yves Bot, the court’s advocate general, said in his opinion that “the provision of care to air passengers is especially important and essential where their flights have been canceled as a result of the eruption of a volcano,” according to a statement from the court today.

The eruption of the Eyjafjallajokull volcano in Iceland two years ago caused airlines to cancel more than 100,000 flights on concern glass-like particles spewed into the atmosphere might clog aircraft engines. The opinion is part of a “test case” for future events and the final ruling won’t involve new financial liability, Ryanair spokesman Stephen McNamara said today in a statement.

‘Blatant Discrimination’

Under EU rules, carriers must provide meals and hotel rooms for passengers stranded by “extraordinary circumstances,” a term that isn’t defined in the law, according to the court’s statement. Ryanair, based in Dublin, argued the eruption qualified as an event that was “above and beyond” such circumstances, possibly exempting it from the payments, the court said.

The block’s current rules expose airlines to “unlimited liability, even in cases such as volcanic ash, which the airlines should not be held responsible for,” McNamara said in the statement. “We hope the final court decision will find in favor of Ryanair’s appeal and remove the blatant discrimination.”

The shutdown of airspace cost carriers at least $1.7 billion, while European transport ministers took five days to agree airports could open with the dust still in the air.

Ryanair canceled about 9,400 flights during the eruption. It refunded all of the passengers’ tickets and settled all “reasonable expense claims” at a cost of about 32 million euros ($42 million), according to a November 2010 regulatory filing.

Flight From Faro

The EU court is advising an Irish tribunal on a claim by Denise McDonagh for about 1,130 euros in damages that she sought from Ryanair to pay for meals, accommodation and transport when her flight from Faro, Portugal, to Dublin was canceled. She was stranded for a week, the court said today.

Bot said the provision of care is “particularly important” in the case of extraordinary circumstances which persist over a long time, according to the court’s statement.

“It is precisely in situations where the waiting period” is lengthy “that it is necessary to ensure that an air passenger whose flight has been canceled can have access to essential goods and services throughout that period,” Bot said in his opinion.

Although the legal adviser’s opinion isn’t binding, such advice is followed by the court in the majority of cases.

The case is C-12/11 Denise McDonagh vs Ryanair Ltd.

To contact the reporters on this story: Erik Larson in London at elarson4@bloomberg.net; Steve Rothwell in London at srothwell@bloomberg.net

To contact the editor responsible for this story: Anthony Aarons at aaarons@bloomberg.net

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