For thirteen years, airline corporations blocked a regulation designed to protect passengers who pay for a service they do not receive. Talks in the final week ran past 5 a.m. on multiple nights. Parliament confirmed a deal this afternoon — on the last day available under EU law.
The agreement preserves €250–€600 compensation for flight disruptions and — for the first time — requires airlines to include cabin bag fees in the advertised ticket price. Airlines must also notify passengers of their compensation rights within four days of a disruption. The rules take effect in 2027.
The Thirteen-Year Lobbying Campaign
The European Commission first proposed revising Regulation EC 261/2004 in 2013. Airline industry pressure, channelled through member state governments, kept the file frozen for over a decade.
The EU Council’s June 2025 position reflected that pressure directly. It proposed raising the delay threshold from three hours to between four and six hours depending on route. It also proposed cutting compensation levels across all distance bands.
Parliament’s own negotiators described the Council’s stance as serving airline interests rather than consumer protection logic. Italy, whose transport minister Matteo Salvini backed the industry line publicly, ranked among its most vocal supporters in the Council chamber.
EasyJet chief executive Kenton Jarvis called the cabin bag proposal “crazy European legislation.” He added it was “a lunatic idea” amounting to politicians “completely not understanding their subject.”
Parliament’s position was unchanged throughout. It voted 632 to 15 in January 2026 to keep the three-hour trigger and existing compensation levels.
Research commissioned by passenger rights advocates found same-day cancellation rates ran more than 20 percent lower in the EU than in the United States, where no equivalent obligation exists. The airlines’ core operational argument had no data behind it.
What Passengers Now Have
Compensation stays at €250 for flights up to 1,500 km, €400 for medium-haul routes, and €600 for journeys above 3,500 km. The amounts apply to delays exceeding three hours, cancellations fewer than 14 days before departure, and denied boarding.
Cabin bag fees must now be embedded in the advertised base fare. Airlines may offer a discounted “no-bag” rate for passengers who choose to travel without overhead luggage — but the standard ticket price covers the right to bring one onboard. Budget carriers that built separate bag charges into their pricing model will need to restructure.
Airlines can no longer require passengers to download a mobile application to obtain a boarding pass — a practice Ryanair introduced in 2025. Fees for correcting minor name errors in bookings are banned.
Children under 14 must be seated next to accompanying adults at no extra charge. Equivalent protections apply to pregnant women and passengers with disabilities.
Process obligations tighten. Airlines must inform disrupted passengers how to claim compensation within four days of a disruption. They must respond to submitted claims within 30 days. Passengers have nine months to file.
€4.3 Billion That Stays on the Table
What Islamic commercial law defines through the dual concepts of ghish (deceptive concealment) and gharar (contractual uncertainty)—presenting an initial price, then attaching its true costs only after a commitment is made—describes the airline fee structure precisely. A carry-on charge absent from the advertised fare does not disappear. It transfers the cost burden to the passenger at the exact point when switching away has become prohibitively difficult.
Flight disruption data compiled by Skycop and published in January 2025 found that nearly 218,000 EU and EEA departing flights in 2024 qualified for compensation under the existing framework. The total entitlement reached an estimated €6.5 billion. Two-thirds of that amount — approximately €4.3 billion — went unclaimed.
Airlines built that forfeiture rate into their financial models. Unclaimed compensation is not a liability on their books: it is operating margin, factored in before any earnings report is filed. Under the new rules, airlines must identify disrupted passengers and send claim instructions within four days. The informational asymmetry that sustained this model narrows — though enforcement across 27 member states remains a separate question entirely.
The money belonged to passengers who did not receive the service they paid for. No airline sent a form. No airline is accountable to those passengers under the framework that existed before today.
The Clause That Still Needs Watching
Airlines remain exempt from compensation in cases of extraordinary circumstances — severe weather, security incidents, strikes, and disruptions caused by third-party airport or air traffic services. The exemption has legitimate grounds. In practice, it has been stretched considerably beyond them.
In March 2026, the EU General Court ruled against a carrier that invoked extraordinary circumstances from a connected flight to justify holding a separate aircraft. The delay resulted from the carrier’s own operational decision to wait. The court was direct: voluntary operational choice breaks the causal chain and triggers compensation liability regardless.
The reform adds no new language on this exemption. The text is unchanged from the framework airlines have stretched for two decades.
Parliament’s plenary vote is scheduled for July 8. Subject to ratification, the rules take effect in 2027. Every European passenger who flew a disrupted route in 2024 and filed nothing left approximately €250 on the table. Two-thirds of them did exactly that — and no airline sent a form to say so.
