ERA reacts to ECA report on EU261 implementation during crisis

27 July 2021: ERA has written to the President of the European Court of Auditors about its report on the protection of passengers’ rights under the COVID-19 crisis published at the end of June. The report has compounded concerns as it proposes an industry levy to cover bankruptcies and even more compulsion in the matter of passenger protection, without having had any regard to differences between airlines, such as regional and international carriers.

ERA, along with its members, are worried that the report calls on EU policymakers to review the regulation, while no analysis of the financial impact of the proposals is made, and the statements in support of those proposals are not based on any comprehensive research, which surprisingly the report itself even acknowledges.

We feel that is very important to refute the assertion of receipt of state aid and its misuse, and the report's implication that all airlines received state aid partly to enable them to reimburse passengers, and that the airlines then made off with that aid for their own benefit and issued vouchers instead, forcing passengers to take them.

We believe the reality is more complex, hence calling for more nuanced responses. Indeed, some carriers received state support and some others have not. The support measures are often linked to severe conditions in terms of cost cutting (including salaries), restructuring, slot divestitures and environmental measures. Moreover, they are loans, that must be repaid with high interest rates; they did not come for free. In addition, different airlines have adopted different practices with regard to refunds.

In view of future discussions at the Council level who is deemed to respond to ECA recommendations by the end of September, and at the Commission in the context of the review of the regulation, ERA wants to engage in a dialogue with EU policy makers on this sensitive issue.