New European Regulation on Air Passenger Rights: What impact for the air transport sector?

The revision of Regulation (EC) No 261/2004 was finally concluded on 15 June 2026 following a political agreement between the European Parliament and the Council. This reform proposal aims to incorporate the case law of the Court of Justice and to clarify, among other things, the rules on compensation, extraordinary circumstances (excluding any compensation), fare transparency and the rights of persons with reduced mobility.

On 15 June 2026, the European Parliament and the Council reached an agreement on the revision of the European legal framework applicable to air passenger rights. Launched by the European Commission in 2013, this revision is the first substantial reform of Regulation No 261/2004 since its adoption in 2004.

Regulation No 261/2004 on passenger rights

Regulation No 261/2004 imposes a series of obligations on airlines in terms of compensation and assistance for passengers in the event of denied boarding, and cancellation or significant delay of a flight. It therefore aims to protect consumers, in order to remedy in particular, the excessive number of denied boardings, cancellations without notice and significant delays in air transport.

It applies to passengers departing from an airport located in the territory of a Member State, as well as to passengers departing from a third country to the Union when the flight is operated by a Union carrier (subject to certain conditions).

Regulation No 261/2004 consequently provides for several rights for passengers that apply in certain cases:

• denied boarding against their will;
• cancellation of a flight; and
• delay of a flight.

These rights concern the rights to reimbursement or re-routing, care, assistance and, in certain cases, fixed compensation (separate from reimbursement) for an amount ranging from EUR 250 to EUR 600 payable by the airlines.

This Regulation has been the subject of extensive European case law involving numerous preliminary ruling proceedings due to the vague nature of certain essential concepts underlying the implementation of passenger rights. Consequently, the Commission adopted interpretative guidelines for Regulation No 261/2004 and launched a revision process of the Regulation itself as early as 2013.

The reform project for Regulation No 261/2004

Due to the aforementioned European case law, a reform of Regulation No 261/2004 was necessary to clarify key concepts of passenger rights.

For example, this Regulation did not expressly provide for fixed compensation for delays on arrival comparable to that provided for in case of cancellation. Following the Nelson judgment, the Court confirmed that passengers on delayed flights may invoke the right to compensation when they suffer a loss of time equal to or greater than three hours on arrival, on the grounds that they are in a situation comparable to that of passengers whose flight has been cancelled.

The agreement between the European Parliament and the Council therefore aims to clarify the existing legal framework on this subject. The future Regulation will specify in more detail the conditions for compensation in case of delay, the complaints procedures, the notion of extraordinary circumstances, price transparency, carry-on luggage, the scope of the regime, passenger information and the rights of disabled persons or persons with reduced mobility, as well as the prohibition of certain "no-show" practices for return flights.

The stated objective is twofold: to strengthen the effective protection of travelers while improving legal certainty for air carriers and national authorities responsible for enforcing the regulation.

One of the most important contributions concerns the rights to compensation in case of delay. Indeed, the three-hour delay threshold on arrival constitutes the essential element of the regime in that it triggers the obligation on airlines to pay compensation. The reform aims precisely to make the rules more readable and the complaints procedures more predictable.

The notion of "extraordinary circumstances" remains another important element. Regulation No 261/2004 provides for compensation obligations payable by airlines in case of cancellation or delay of flights, even though in many cases they are not responsible (air traffic controller strikes, delays caused by ground handling companies, accidents caused by third parties, etc.). Under this Regulation, the airline is not obliged to pay compensation for cancellation or delay if it can demonstrate the existence of extraordinary circumstances that could not have been avoided even if all reasonable measures had been taken. This notion of extraordinary circumstances has been the subject of numerous judgments by the Court of Justice of the EU on strikes by airline staff or other sector actors, bird collisions, security risks (bomb alerts, terrorist threats, etc.), natural disasters, etc. The revision therefore proposes to reduce certain uncertainties and to frame this notion to ensure the effectiveness of passenger rights by listing and setting out the rules relating to the application of these extraordinary circumstances.

Price transparency and, in particular, pricing relating to carry-on luggage also constitute important issues in this sector. The principle of passenger information regarding prices is guaranteed by Article 23 of Regulation (EC) No 1008/2008 of the European Parliament and of the Council of 24 September 2008 on common rules for the operation of air services in the Community. However, in practice, an increasing proportion of the airfare results from ancillary charges, sometimes related to luggage, seat selection or other additional services. The political agreement concluded on 15 June 2026 by the European Parliament and the Council contains elements relating to the transparency and comparability of airfares with the aim of protecting consumers but also to reduce a form of price competition.

The reform also includes a section on disabled persons and persons with reduced mobility. It will entail an amendment to Regulation (EC) No 1107/2006, which establishes specific rights for this category of passenger in air transport.

This political agreement comes at a time when the aviation sector is facing significant events on many fronts: health crises, rising fuel prices and geopolitical tensions.

Next steps

The European Parliament and the Council will soon formally approve their agreement and adopt the proposed new Regulation. It will enter into force one year after its publication in the Official Journal of the EU.

For airlines, the challenge will be to integrate these new rules into their general terms and conditions, their complaints handling systems and their pricing policies.

Member States will have to take appropriate measures to guarantee the effectiveness of passenger rights.

The reform will also have a significant impact on passengers, who will have better visibility of their rights, and these rights will be uniformly applied throughout the European Union.