Five international airlines, including Emirates and Etihad, could face unlimited fines in the UK after the country’s aviation watchdog said enforcement action would be taken against them for denying passengers compensation for delayed flights.
The Civil Aviation Authority estimates more than 200,000 passengers a year travelling on the two UAE carriers, American Airlines, Singapore Airlines and Turkish Airlines, which are also facing action, could be at risk of missing connecting flights due to delays.
British authorities said the airlines had breached EU consumer law after a review of airline policies.
According to the CAA’s data, Emirates was the most complained about airline for the non-payment of compensation for missed connection flights.
However, Eithad described the CAA’s decision to blame the airline in public as "unprofessional and unacceptable".
"Etihad Airways has been engaged in constructive dialogue with the Civil Aviation Authority in the UK on the issue of compensation over several months," said a spokesman for Etihad Airways.
"We take such matters very seriously and in no way look to breach the law.
"Therefore, before even completing the dialogue, we find the CAA’s approach wholly ‘unprofessional and unacceptable’ to publicly blame Etihad Airways for infringements to passengers’ rights which we unreservedly deny."
Following its own review, the airline said it states "categorically" that it has not contravened the law and pledged to maintain dialogue with the CAA to make sure robust compensation policies were in place.
The CAA said it decided to take action after repeated efforts to get airlines to change their policies.
"The first stage of this involves getting signed undertakings from the airlines that legally bind them to making changes," a CAA spokesman said.
"The airlines have to make the changes we set out, or we can seek a court order to force them to make those changes.
"If airlines do not comply with that court order, they will be in contempt of court and face an unlimited fine."
The two UAE airlines had confirmed to the regulator that they did not pay compensation to passengers delayed on the first leg of a flight that caused them to miss a connecting flight and, as a result, to arrive at their final destination more than three hours late.
Failure to compensate passengers in this manner breached legal passengers rights for flight disruption, said the regulator.
European guidelines on passenger rights during disruptions are clear that the final destination of a connecting flight is the last airport listed on the passenger’s ticket, it said.
They were also criticised for not having alternative dispute resolution (ADR) services which are independent and provide quick binding resolutions for complaints.
"Any disruption to a flight is frustrating for passengers, but delays that cause people to miss connecting flights have a particularly damaging effect on people’s travel plans," said Richard Moriarty, director of Consumers and Markets at the CAA.
"That’s why there are clear laws in place to make sure passengers that experience this type of disruption are looked after by their airline and compensated when the disruption was in the airline’s control.
"Airlines’ first responsibility should be looking after their passengers, not finding ways in which they can prevent passengers upholding their rights."
He said it was disappointing a small number of airlines continued to let down their passengers by refusing to pay the compensation they were entitled to.
"Where we see evidence of passengers systematically being denied their rights, we will not hesitate to take the necessary action to ensure airlines change their policies and their customers get the assistance they are entitled to," he said.
Under European rules, passengers are legally entitled to compensation if they arrive at the final destination of their journey more than three hours late - including if booked on a connecting flight - unless the delay was due to extraordinary circumstances, said the CAA.
These rights applied to any flight departing an EU airport, regardless of the nationality of the airline.
However, Etihad said the issue of non-EU airlines liability under EC261 for delays caused by a missed connecting flight outside of the EU was subject to a case that will be heard by the UK court of appeal.
"Etihad Airways will, of course, abide by any decision of the court of appeal," said Etihad.
The regulator began enforcement action following an extensive review of policies for the top 31 airlines operating in the UK.
Emirates had not responded at the time of publishing.
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