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Apr 6, 2022

Canadian airlines among carriers asking appeal court to quash passenger rights rules

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Canadian airlines are asking a Federal Court of Appeal panel Wednesday to quash rules that bolstered compensation for passengers subjected to delayed flights and damaged luggage.

Air Canada and Porter Airlines Inc., along with 16 other appellants that include the International Air Transport Association -- IATA has more than 300 member airlines -- argue that payments required under the country's three-year-old passenger rights charter violate international standards and should be rendered invalid.

First filed in 2019, the court application states the new provisions exceed the Canadian Transportation Agency's authority. They also contravene the Montreal Convention, a multilateral treaty, by setting compensation amounts based on the length of the delay and "irrespective of the actual damage suffered," according to the appellants.

The filing further says nullifying the regulations "would avoid the confusion to passengers" who could be subject to travel regimes from multiple jurisdictions on international flights.

Under the federal rules, passengers have to be compensated up to $2,400 if they were denied boarding because a flight was overbooked, and receive up to $2,100 for lost or damaged luggage. Delays and other payments for cancelled flights warrant compensation of up to $1,000.

The issue came to the forefront after a 2017 incident in which two Montreal-bound Air Transat jets were diverted to Ottawa because of bad weather and held on the tarmac for up to six hours, leading some passengers to call 911 for rescue.

It took on renewed relevance to thousands of Canadians starting in March 2020 as the COVID-19 pandemic and travel restrictions grounded fleets and prompted mass flight cancellations.

The hearings are slated to run Wednesdayand Thursday.

In 2020, the Federal Court of Appeal dismissed an attempt by airlines to freeze the country's new passenger bill of rights until an appeal of the regulations was heard.

Air Passenger Rights president Gabor Lukacs, an intervener on the case, argues that compensation rules on flights into and out of the country are entirely Canada's right.

"As part of its sovereignty, Canada has the freedom to decide what conditions it attaches in exchange for the privilege to operate airlines or commercial flights to and from Canada," he said in a phone interview.

"This appeal, I view it as an attack in disguise on the validity of the entire Canadian regulatory scheme for transportation of passengers to and from Canada."

Some travellers and advocates say the rules don't go far enough and allow for loopholes.

AirHelp, a Berlin-based passenger rights company, has said the exemptions for weather or mechanical malfunctions don't encourage airlines to avoid "so-called undiscovered issues" and allows them to sidestep compensation by pointing to malfunctions on the tarmac.