EUROPEAN COMMISSION

Brussels, 29.11.2023

SWD(2023) 386 final

COMMISSION STAFF WORKING DOCUMENT

IMPACT ASSESSMENT REPORT

Accompanying the documents

Proposal for a Regulation of the European Parliament and of the Council amending Regulations (EC) No 261/2004, (EC) No 1107/2006, (EU) No 1177/2010, (EU) No 181/2011 and (EU) 2021/782 as regards enforcement of passenger rights in the Union

Proposal for a Regulation of the European Parliament and of the Council on passenger rights in the context of multimodal journeys

{COM(2023) 752 final} - {SEC(2023) 392 final} - {SWD(2023) 387 final} - {SWD(2023) 389 final}

1    Introduction    

1.1    Political and legal context    

1.2    Scope of this Impact Assessment    

1.3    Other policy initiatives regarding passenger rights    

1.4    Synergies with other EU initiatives    

2    Problem definition    

2.1    What are the problems and why are they a problem?    

2.2    What are the problem drivers?    

2.3    How likely is the problem to persist?    

3    Why should the EU act?    

3.1    Legal basis    

3.2    Subsidiarity: Necessity of EU action    

3.3    Subsidiarity: Added value of EU action    

4    Objectives: What is to be achieved?    

4.1    General objectives    

5    What are the available policy options?    

5.1    What is the baseline from which options are assessed?    

5.2    Description of the policy options    

6    Impacts of the policy options    

6.1    Economic impacts    

6.2    Social impacts    

6.3    Impacts on fundamental rights    

6.4    Environmental impacts    

7    How do the options compare?    

7.1    Effectiveness    

7.2    Efficiency    

7.3    Coherence    

7.4    Subsidiarity and Proportionality    

8    Preferred options    

8.1    Identification of the preferred policy options and stakeholder views    

8.2    REFIT (simplification and improved efficiency)    

8.3    Application of the ‘one in, one out’ approach    

9    How will actual impacts be monitored and evaluated?    

Annex 1: Procedural information    

Annex 2: Stakeholder consultation (Synopsis report)    

1.    Consultation methods and stakeholders involved    

Annex 3: Who is affected and how?    

Annex 4: Analytical Methods    

1.    Description of the analytical methods used    

2.    Baseline scenario    

2.1.    Main assumptions of the baseline scenario    

2.2.    Baseline scenario results    

3.    Assessment of the economic impacts by policy measure    

3.1.    Problem area 1 - Enforcement of EU passenger rights legislation    

3.2.    Problem area 2 - Protection of passengers performing multimodal journeys    

3.3.    Problem area 3 - Reimbursement rules are unclear when flights were booked via an intermediary    

Annex 5: Competitiveness Check    

Annex 6: Discarded Measures    

Annex 7: Detailed Policy Measures    

Annex 8: SME Test    

Annex 9: Background on the development of EU passenger rights    

Annex 10: Payment Flows / problem of unclear reimbursement rules for tickets booked via intermediaries    

Annex 11: Reimbursement policies for tickets booked via intermediaries    

Annex 12: Intermediaries’ Terms and conditions on their reimbursements to customers    

Annex 13: CPC Action    

Glossary

1Introduction

1.1Political and legal context

This Impact Assessment (IA) accompanies two legislative proposals aimed at introducing common rules on the enforcement of passenger rights, passenger rights for multimodal journeys and rules for reimbursements of airlines to passengers when intermediaries are involved.

Passenger rights are at the heart of the EU transport and consumer policy and are considered a flagship initiative of the EU. The European Union is the only area in the world where citizens are protected by a full set of passenger rights – whether they travel by air, rail, ship or bus and coach. A solid EU framework has been put in place for all transport modes since 2004, with the adoption of four Regulations for air, waterborne, bus and coach and rail, plus a fifth Regulation addressing air transport for passengers with reduced mobility 1 .

The Sustainable and Smart Mobility Strategy (SSMS) 2 adopted in 2020 underlined that the shift towards sustainable, smart and resilient mobility must be just and fair. Fair mobility means protection for passengers and their rights. To achieve the EU’s ambitious climate goals 3 , people need to have the tools to opt for a seamless multimodal public transport throughout their journey. To support this, people should be aware how they are protected in case of disruptions or cancellations on such journeys. In addition, the unprecedented mass cancellations that were seen during the COVID-19 pandemic showed the importance of EU-wide rules and their uniform implementation and enforcement.

With the SSMS, the Commission expressed its intention to review the existing framework in depth. In particular, it committed to take action to ensure that EU passenger rights are better implemented; are clearer for both carriers and passengers; offer adequate assistance and reimbursement when disruptions arise; and provide for appropriate sanctions if the rules are not properly observed. Moreover, the Commission announced its intention to assess options for a multimodal framework for passenger rights (Action 63 4 ), and for an adequate financial protection scheme to protect passengers from carrier liquidity crisis or insolvency (Action 64) 5 . Both initiatives are listed in the Commission work programme 2023 6 .

1.2Scope of this Impact Assessment 

The Call for Evidence, published in December 2021 7 , covered both Action 63 and 64 of the SSMS. Based on the initially collected data, and various stakeholders’ views received after the Call for Evidence, stakeholders were consulted on five problem areas: 1) Lack of financial protection for air passengers against the risk of a liquidity crisis or an insolvency regarding the reimbursement of tickets and passengers' repatriation, if needed (covering Action 64 of the SSMS); 2) Delayed reimbursement of air passengers booking via an intermediary ticket vendor; 3) Lack of reimbursement for flights cancelled by passengers as a result of a major crisis; 4) Insufficient protection for passengers making multimodal journeys; and 5) Insufficient enforcement of passenger rights in all modes. 8 Two of these initial problem areas were eventually discarded from the IA, namely:

·Problem area 1: The air passenger rights Regulation (EC) No 261/2004 does not contain provisions ensuring the reimbursement of flight-only passengers in situations where a carrier becomes insolvent or faces a liquidity crisis, nor does it cover the repatriation of passengers stranded abroad (nor is this part of the proposal to amend this Regulation 9 ). Meanwhile, the Package Travel Directive (EU) 2015/2302 10  obliges Member States to ensure that organisers provide security for the refund of all payments in case of insolvency, and, if the package travel contract includes carriage, that organisers provide security for the travellers' repatriation. However, a major difference between the rules for EU package travel organisers and those for airlines is that EU airlines are subject to minimum financial requirements and ongoing financial oversight by national licensing authorities under the Air Services Regulation (EC) No 1008/2008 11 .

Coherence with the revision of the Air Services Regulation (Action 59 of the SSMS) is needed to improve the financial resilience of air carriers and price transparency. There is therefore a very close link between Action 64 and Action 59 of the SSMS. The impact of measures to mitigate the risk of a liquidity crisis or disorderly insolvency of an air carrier, and to better support reimbursement and repatriation in such cases, cannot be looked at in isolation. Therefore, the combined impacts of all these measures will be looked at in the impact assessment for a possible revision of the Air Services Regulation, where work is still ongoing 12 . The need for intervention must be carefully assessed. Before the COVID-19 crisis, it was estimated 13 that between 2011 and October 2019, some 5.6 million passengers, or 0.04% of total EU passengers, were affected by airline insolvencies 14 15 . The average loss of affected passengers is estimated to be €357, leading to detriment for travellers of €2bn in this period. In 2019, the rate of affected passengers was 0.14%. During the COVID-19 pandemic, national licensing authorities were allowed to maintain airline operating licences even in case of financial difficulties, as long as safety was not at risk. However, problems resulting from insolvencies remained very limited during this period and problems related to deferred payments by airlines during the pandemic were subsequently addressed by a Consumer Protection Coordination action 16 .

·Problem area 3 on passengers’ rights to reimbursement when self-cancelling due to a major crisis: The consultation not only showed that this issue is marginal, but also that any such right would apply under certain circumstances which are difficult to delineate, thus making the passenger rights framework even more complicated. Consequently, for the sake of proportionality, this problem was discarded early on in the process 17 .

Given the above, the scope of this IA has been narrowed down to three areas, starting with the area with the widest scope: 1) enforcement across all modes of transport, including multimodal transport, 2) multimodal passenger rights and 3) reimbursement of airline tickets when these were booked via intermediaries. They correspond to the abovementioned areas 2, 4 and 5 of the five areas on which stakeholders were consulted in an initial phase of the process.

1.3Other policy initiatives regarding passenger rights

This impact assessment takes the state of play of the different passenger rights Regulations into account.

With regard to air passenger rights, the Commission already stepped up efforts in 2013 to make passenger rights clearer and better applied by adopting a proposal 18 to amend Regulation (EC) No 261/2004 19 . The inter-institutional process on this proposal is not completed yet 20 but it remains a priority pending file for the Commission 21 and is also listed among the common legislative priorities of the three EU institutions for 2023 and 2024 22 . The discussions on the proposal have especially highlighted the complexity of finding an adequate balance between rights of passengers and obligations of carriers. To support the deliberations on this proposal in the Council a study on the current level of protection of air passenger rights in the EU, published in January 2020 23 , takes a comprehensive look at the topic by reflecting the evolution of the air travel market in recent years up until 2019. This fact-finding study showed that the need for reform has become even more urgent since 2013. It also concluded that Interpretative Guidelines 24 might help but would not be able to solve all problems identified with the application. Therefore, problems dealt with in the proposal of 2013 to amend Regulation (EC) No 261/2004 are excluded from the scope of this IA and the policy measures presented in this IA are complementary to the legislative proposal of 2013.

In view of the experience with the abovementioned legislative proposal of 2013 for air passengers, the Commission proposed (only) a targeted recast of the rail passenger rights Regulation (EC) No 1371/2007 25  in 2017, which led to the adoption of the Regulation (EU) 2021/782 26 which is applicable as of 7 June 2023. This new Regulation introduces several new rules for rail passengers which could also be useful for the protection of passengers travelling with other modes of transport (or even multimodal), such as on the provision of real-time dynamic traffic and travel information, a new EU-wide standardised form for compensation and reimbursement requests, or better tools for national enforcement bodies (NEBs). The policy measures presented in this IA are therefore complementary to the new rail passenger rights Regulation as well.

In 2021, the Commission also published three evaluations of the regulatory framework on the rights of waterborne passengers 27 , bus and coach passengers 28 , and persons with disabilities and persons with reduced mobility when using air transport 29 . The three evaluations show inter alia that there is room to improve the enforcement of these Regulations. NEBs often have very limited human resources to identify irregularities and act upon them, to enforce the Regulations, and their approaches differ significantly: some are proactive and engage in different monitoring activities allowing for the detection and correction of recurrent non-compliances against passenger rights (e.g., regular dialogue with industry and passenger representatives, inspections, audits, review of operator homepages, etc), while others only react to complaints that passengers submit to them and do not carry out own-initiative monitoring or enforcement activities. 30

As shown by several Eurobarometer surveys 31 , passengers’ lack of awareness of their rights, and problems with enforcing these rights, are a recurrent issue. The last survey of 2020 showed that only about one in three EU citizens knows that passenger rights exist in the EU (a similar result to the 2014 Eurobarometer). Therefore, the Commission regularly organises campaigns to promote passenger rights awareness 32 , and offers information on the Single Digital Gateway ‘Your Europe’ on passenger rights as well as on a passenger rights app available in all official EU languages 33 . The lack of passenger awareness and problems with the enforcement of their rights were also highlighted by the European Court of Auditors (ECA) in its report no 30/2018 “EU passenger rights are comprehensive, but passengers still need to fight for them” 34 . The COVID-19 pandemic also showed that passengers were not well aware of their rights and often did not know whom to turn to for enforcement. ECA’s report no 15/2021 “Air passenger rights during the COVID-19 pandemic: Key rights not protected despite Commission efforts” came to the same conclusion 35 .

The European Parliament “has always been a strong advocate of passenger rights irrespective of the mode of transport used. Its main aim is now to ensure that the texts adopted in recent years are properly applied” 36 . It also underlined the importance of implementing passenger rights correctly during the COVID-19 pandemic 37 . The Council 38  welcomed the Commission’s consideration of the ECA's recommendations and invited the Commission “to reflect on how to improve the current setup, based on the experiences, shortcomings and lessons learnt and the European Court of Auditors' Special report, as announced under the Commission’s Sustainable and Smart Mobility Strategy.”

1.4Synergies with other EU initiatives 

The Impact Assessment takes into consideration other EU legislation currently under revision or development. Throughout the process, it has been ensured that the review of the passenger rights framework does not overlap with these other initiatives, but instead complements them.

·Proposal amending Directive (EU) 2015/2032 on package travel and linked travel arrangements (PTD) 39 : coherence has been ensured, especially regarding rules on intermediaries. Moreover, it should be clarified that the Package Travel Directive and the passenger rights Regulations, albeit both dealing with travel, concern two separate markets and hence do not overlap per se. Whereas passenger rights exclusively deal with passenger transport services (e.g. flights, rail and bus services - including multimodal combinations of such services), the rules on package travel cover a combination of different travel services offered by an organiser (e.g. a package combining a flight and hotel accommodation).

·The Regulation (EU) 2017/2394 on Consumer Protection Cooperation (CPC) 40 , establishing a pan-European enforcement network in EU/EEA, is also currently under revision 41 . This complementary instrument provides a cooperation framework for national authorities from all countries in the European Economic Area to jointly address breaches of consumer rules (including passenger rights) when the service provider and the consumer are established in different countries. The synergies can be seen in the context of the two CPC actions against airlines and intermediaries, regarding problems encountered with reimbursements during the COVID-19 pandemic. The aim of the revision is to strengthen the enforcement of consumer law and maintain a level playing field for business, learning from the recent evolution of the market.

·Directive 2013/11/EU (the Alternative Dispute Resolution Directive) allowing consumers, including passengers, to seek the out-of-court settlement of their disputes arising from the breach of passenger rights throughout the EU using alternative dispute resolution bodies, is also currently under revision. The Commission adopted on 17 October 2023 a proposal to amend this Directive: the amendment would include, among others, broadening the Directive’s scope to third country traders (e.g carriers, ticket vendors) and to disputes arising not only from contractual relations but also from the pre-contractual stages and from certain non-contractual relationships, thus further enhancing the use of out-of-court settlement to solve passenger rights claims 42 .

The initiative contributes towards Sustainable Development Goals (SDG) #10 Reduce inequality within and among countries (regarding passengers with disabilities and reduced mobility), #13 Climate action (enhanced passenger rights may incentivise people to use more public transport instead of private cars), and #16 Provide access to justice for all and build effective, accountable and inclusive institutions (enhanced and accessible means of redress for passengers and better tools for enforcement for the administration).

2Problem definition

2.1What are the problems and why are they a problem? 

The EU passenger rights Regulations are at the core of European passenger transport, providing passengers with protection when they travel with one collective transport mode anywhere in the EU. These rules cover rights for passengers when a disruption occurs, information provision to passengers both before and during travel, and complaint possibilities in case the rules are not followed 43 . These rights are important to keep passengers’ confidence in collective transport modes. In 2019, a total of 13.4 billion passengers 44 travelled in the EU by air, bus and coach, rail or waterborne transport including 8.6 billion rail passengers, 970 million air passengers, 418 million waterborne passengers and 3.3 billion bus & coach passengers (of which 369 million travelling above 250 kilometres 45 ). Around 107 million passengers’ services were performed in 2019. Moreover, in 2019, it is estimated that 82.7 million requests were made for PRM assistance on all four modes of transport 46 .

Analysis conducted for the preparation of the SSMS, evaluations of the existing Regulations, results of the 2020 Eurobarometer on passenger rights, reports by the European Court of Auditors, feedback gathered by the Commission during the COVID-19 crisis, and the consultations undertaken for this impact assessment have highlighted the following problems:

2.1.1Problem 1: Passengers do not fully benefit from their rights due to shortcomings in implementation and enforcement

Passengers of all modes of transport are affected by this problem. Passengers’ knowledge of their rights is low: only 43% of the respondents to the 2020 Eurobarometer survey 47 who travelled with at least one transport mode in the past 12 months indicated that they were aware of the existence of passenger rights in the EU. Among the general sample of 27,973 respondents to the survey, including those who had not travelled recently, the awareness level was even lower, standing at 32%. Only 40% of the 7,666 respondents travelling by air indicated that the carrier informed them well about their passenger rights before their journey. Even fewer respondents travelling by other transport modes indicated that they were well informed by the carrier about their passenger rights (29% of 2,414 respondents for ferry and cruise, 26% of 9,516 respondents for rail and 26 % of 4,473 respondents for bus and coach). Furthermore, 55% of the 5,560 respondents who experienced travel disruptions indicated that they were not satisfied with the way carriers informed them about their complaint handling procedures. Such procedures can be complex and constrained by requirements to use specific formats (e.g. electronic forms), making it difficult for passengers to provide all the information needed for the investigation of their complaints.

Just about a quarter (26%) of the 5,560 respondents who experienced travel disruptions made an official complaint. Among those who experienced a travel disruption but did not make a complaint, the most frequent reason for not complaining was the feeling that it would be useless (45%); for 25% of the concerned travellers, the involved amount was too small; while 16% said the procedure was too cumbersome. The results of this survey are confirmed by the Commission’s 2020 study of the current level of protection of air passenger rights, cited above, which found that the process for passengers to obtain redress is lengthy, particularly for first time claimants, and can discourage them from making claims.

The abovementioned study on air passenger rights and the Commission’s recent evaluations of the bus and coach, waterborne and air PRM Regulations show that, beyond claims related to compensation for cancellation or long delays of flights 48 , NEBs have received very few complaints. As reflected by the findings presented above, this results from a mix of factors: many passengers are not aware of their rights, the procedure to submit a complaint is too cumbersome and passengers consider it useless to complain (either because the NEB cannot take a binding decision or in case of certain breaches of passenger rights passengers cannot get any compensation or the compensation due is not commensurate to the effort invested in submitting a complaint).

Although operators confirmed in the stakeholder consultation that they collect key performance indicators about their own compliance with passenger rights (number of complaints received and the problems raised in them, amount of money paid as compensation to passengers, results of passenger surveys, punctuality of services, etc.), according to information available to the Commission such information is not shared with NEBs 49 . The 2021 special report from the ECA concluded that NEBs do not have a good overview of operators’ compliance with passenger rights and cannot focus their limited resources for monitoring and enforcement. According to this ECA report, one of the problems is that most NEBs do not have the right to ask carriers about the number of complaints they receive 50 . The Commission evaluations of 2021 also came to a similar conclusion about the NEBs’ resources available for monitoring and enforcement 51 . The ECA recommended in its report of 2018 that the NEBs should be provided with further tools for the enforcement of passenger rights, e.g. for monitoring the carriers' policies on assistance, care, information and re-routing. The ECA also recommended that the Commission should explore how to receive the necessary information from the NEBs and how to help NEBs better control enforcement 52 .

Organisations representing passengers indicated several times that various shortcomings in the enforcement make it impossible for passengers to fully enjoy their rights and called on the Commission to make a proposal to strengthen enforcement 53 .

71% (105 out of 149) of respondents to the targeted stakeholder consultation strongly or somewhat agreed that carriers, terminal operators and NEBs applying EU passenger rights legislation in different ways is an important element of the problem. The 15 respondents who disagreed were: 8 carriers operating in transport modes other than aviation (out of 24 responding), 2 NEBs (out of 47 NEBs responding) and 2 national authorities (out of 9 responding). Similarly, 67% (99 out of 148) of respondents, including 29 out of 47 NEBs, strongly or somewhat agreed that the enforcement of EU passenger rights legislation by NEBs is neither harmonised nor consistent.

This confirms the findings of the evaluation of Regulation (EC) 1107/2006, Regulation (EU) 1177/2010 and Regulation (EU) 181/2011 which concluded that the overall approach of NEBs toward monitoring the implementation of the Regulations varies significantly: while some NEBs are very proactive, others appear only to react to complaints which they receive. In addition, only a small proportion of NEBs have issued penalties for the breach of these Regulations, and even such penalties were generally small.

2.1.2Problem 2: Insufficient protection of passengers during multimodal journeys

The SSMS confirmed the ambition of the European Green Deal 54 to achieve a 90% reduction in transport emissions by 2050. An important element of making transport more sustainable is achieving effective multimodality, where passengers who wish to travel long distances can do so by combining several modes of transport while using the most sustainable and efficient mode for each leg of the journey. It is estimated that 91 million passengers performed multimodal journeys in 2019 (representing approximately 0.7% of the total number of passengers subject to passenger rights) 55 , and the number is expected to grow 56 . Protecting passengers in the event of travel disruptions is key to the attractiveness of multimodal travel. Failure to provide such support could itself affect market growth, with some passengers choosing to travel by car instead of collective transport (judging car travel to be both more convenient and more reliable).

Today, while passengers who travel with one mode (i.e. only by plane, train, bus or ship) enjoy rights in the event of travel disruptions, they are not entitled to similar rights when switching to another mode. This implies that there is also no clear framework for determining the respective obligations and liabilities of the different travel service providers involved in a multimodal journey 57 . National legal frameworks generally do not include provisions covering multimodal transport either 58 . In addition, the current offer of travel insurances for multimodal journeys remains limited. The rights of passengers in the context of multimodal journeys depend therefore on the existence of a contract of carriage covering the switch between transport modes and on the concrete terms and conditions of such contracts..

Consequently, passengers lack information on the extent of their rights before and during multimodal travel and are not given information in real-time on possible travel disruptions and security alerts. In addition, those passengers do not receive assistance (e.g. reimbursement, re-routing, accommodation, meals and refreshments) if a travel disruption occurs when switching between transport modes. Finally, passengers have difficulties to complain to carriers and other possible relevant actors (e.g. terminal operators, ticket vendors) about the lack of information or assistance, nor do they have clarity on which national authority to contact in such cases. This lack of a specifically designated authority also leads to uncertainty on the enforcement of information and assistance to passengers during multimodal travel. The consequences of the lack of information and assistance to passengers when switching modes include loss of connections and money for citizens, biased decisions from citizens towards less green solutions, possible undue profits for carriers, and ultimately a lack of consumer trust in multimodal travel options.

The 2020 Eurobarometer survey shows that 25% of respondents using a multimodal ticket in 2019 experienced a problem when travelling. 59 The targeted consultation showed varying perceptions of how severe this problem is: 62% (89 out of 145) of respondents to the survey strongly or somewhat agree that the problem is important, while 18% (26 out of 145) fully or somewhat disagree. The latter were mainly carriers (for all modes of transport) and their umbrella organisations, who argued that the multimodal ticketing market is still at an early stage of development, and that multimodal agreements are limited in number due to their complexity. Intermediary ticket vendors generally regard the development of passenger protection during multimodal journeys as challenging in a context where carriers do not give them the information needed to sell such tickets.

The lack of rules for multimodal journeys also means that PRM are not entitled to any assistance under EU law when transferring between transport modes, including at multimodal connecting points such as air-rail hubs. In the absence of such assistance, they are not able to benefit from the same travel experience as other passengers. The public consultation revealed diverging views on this. For 18 out of 19 consumer organisations, all 7 PRM organisations, as well as 9 out of the 19 public authorities responding, the absence of assistance for PRM when switching between different transport modes is an important problem aspect. One third of business associations (11 out of 33) and 29% of individual businesses (8 out of 27) also agreed with this statement, but respectively 42% (14 out of 33) and 37% (10 out of 27) of them disagreed, while the others were neutral or had no opinion.

2.1.3Problem 3: Reimbursement rules are unclear when flights were booked via an intermediary

No EU rules exist nor have been proposed for reimbursement of air tickets that were booked via intermediary ticket vendors and are not part of a travel package. Passengers have no clarity on the following issues:

-who is responsible (the intermediary or the carrier) for the reimbursement to the passenger when the ticket was booked via an intermediary; 

-which deadlines and procedures apply for reimbursements when a ticket was booked through an intermediary;

-whether intermediaries are allowed to charge fees for the reimbursement processing 60 .

The problem of unclear reimbursement rules for air passengers when flights were booked via an intermediary affects all passengers who booked their tickets via intermediaries (450 million passengers in EU-27 in 2019, as explained in Annex 11) 61 62 . It is estimated that around 3% of passengers who booked via intermediaries 63 request a reimbursement, which amounts to around 13.5 million passengers yearly. The problem also concerns 149 airlines and 123,000 air travel intermediaries in the EU.

During the stakeholder workshop, different stakeholder groups agreed that the liability and responsibilities regarding the provision of information to passengers and the processing of refunds should be clearly defined in case an intermediary is involved. Such a view has also been stressed by passenger organisations in response to the call for evidence and by business organisations and associations through the OPC. In the targeted consultation, most stakeholder groups confirmed the statement that air carriers cannot always meet the obligation to reimburse passengers within seven days following the cancellation of a flight booked via an intermediary ticket vendor (e.g. because the air carrier does not have sufficient information to make payments directly to passengers). However, 13 out of the 14 intermediary ticket vendor respondents disagreed.

2.1.4Other problems on which stakeholders were consulted

In addition, and as explained in section 1.2, stakeholders were consulted on two other problems, which were not pursued in this impact assessment, namely:

First, the effectiveness of protection for air passengers against the risk of a liquidity crisis or an insolvency affecting an airline’s ability to reimburse tickets and/or to ensure passengers' repatriation, if needed. As mentioned, this problem and possible solutions will be assessed together with another initiative: the review of the Air Services Regulation.

Second, the lack of reimbursement for tickets cancelled by passengers themselves in the context of a major crisis. There were some indications that many passengers may not have been fully aware of their rights, leading some passengers to cancel themselves their tickets due to the unprecedented situation during COVID-19. Whether they had a right to reimbursement depended on the terms and conditions of the ticket: if they had not bought a flexible ticket, they did not receive a reimbursement. The EU passenger rights Regulations cover only cancellations by carriers, not by passengers. The fact that single ticket passengers do not have a statutory right under EU rules to receive reimbursement when cancelling themselves is a clear difference from the Package Travel Directive (PTD), which provides travellers with the right to receive a partial or full refund when they terminate the package travel contract before the start of the package. This may confuse passengers when they find themselves in a crisis situation. The issue of these diverging rules was also mentioned by the European Court of Auditors 64 . However, after further analysis, the evidence showed that only very few passengers (well below 1%) were affected by this situation before COVID-19, and 2.87% of passengers were affected during COVID-19 65 .

In the context of the review of the Air Services Regulation, the services of the Commission are assessing measures to help passengers to make fully informed choices about what is included in their tickets and notably to be better informed about which elements of the ticket price are reimbursable and under which conditions, when they want to cancel their tickets themselves. The Air Services Regulation already contains requirements on price transparency 66 , with a view to ensuring that customers can compare effectively the prices for air services of different airlines. The relevant measures under consideration in this context would require the clear display of information about the reimbursable amount in case the passenger cancels the ticket themselves or does not turn up for boarding (certain taxes, fees and charges are often reimbursable even when the ticket itself is non-refundable, though passengers may not be aware of this). 

2.2What are the problem drivers?

The following problem drivers are related to problem 1: Passengers do not fully benefit from their rights due to shortcomings in implementation and enforcement, as shown in Figure 1 below:

Figure 1 - Link between Problem Drivers 1-3 and Problem 1

2.2.1Problem Driver 1: NEBs lack the information base to carry out an effective enforcement

The lack of information available to NEBs is undermining their ability to monitor operators’ compliance with EU passenger rights across all modes. The limited transparency of carriers’ and terminal operators’ compliance with passenger rights vis à vis the NEBs has also been identified as an issue the following recent studies.

In the study on air passenger rights of 2020 67 it was noted that NEB enforcement is very largely based only on complaints received (by the NEBs) as there is no obligation for airlines to report on compliance with the obligations stipulated in Regulation (EC) 261/2004 and that without such reports it is very difficult to monitor compliance with existing obligations. This finding was confirmed by ECA, which highlighted in its report of June 2021 that this was an issue during the COVID-19 pandemic as well.

The Commission’s evaluation reports on the rights of PRM when travelling by air 68 , on bus and coach 69 and waterborne passenger rights 70 of 2021 found that the NEBs often carry out their tasks with limited human resources, and that their monitoring and enforcement activities could be more efficient if they could rely on carriers’ data about compliance with passenger rights. During the consultation, several carriers across transport modes indicated that they collect data about their compliance with passenger rights (e.g. numbers of complaints received, issues raised and the outcome, level of cancellations and delays, passenger survey results, etc.). While very few operators publish detailed information about such data, most of them provide only limited summary data or no data at all. Some consulted carriers argued that such data is commercially sensitive, and one waterborne carrier considered that if such data were to be published, the public could draw wrong conclusions from them. On the other hand, EU level consumer and passenger organisations claimed that the lack of publicly available data not only makes the monitoring and enforcement work of NEBs difficult, but also prevents passengers from making informed decisions about which operators to choose for their journeys.

2.2.2Problem Driver 2: Insufficiently effective and uniform implementation and enforcement across all Member States 

The evaluations published in 2021 as well as NEBs accounts from the Expert Group meetings show that there are substantial differences in how NEBs exercise their enforcement activities, in particular how they monitor compliance with passenger rights. Proactive NEBs perform a great variety of monitoring and enforcement activities ranging from reviews of operators’ websites, anonymous purchase tests, regular dialogue with operators, on the spot audits and inspections while other NEBs seem to limit their activities to complaint handling and imposing penalties in cases of severe breaches of the passenger rights Regulations. 71 .Certain NEBs are obliged to publish reports about their monitoring and enforcement activities, 72 however they do not have to indicate in those activity reports the approach on which their monitoring and enforcement activities are based. As a consequence, the activity reports of NEBs show a lack of consistency of NEB’s monitoring and enforcement activities across EU Member States.

For several years, the Commission has highlighted in its reports that handling complaints and penalising non-compliance are just two of the possible measures that can be used to enforce passenger rights 73 , and that NEBs need to be more pro-active in monitoring, e.g. to carry out inspections 74  In 2014, the Commission concluded that while some NEBs actively take initiatives to improve the enforcement of PRMs' rights, more needs to be done by the majority of NEB 75 . The 2020 study on the state of play of air passenger rights concluded that NEBs should undertake monitoring activities to maintain oversight of the airlines’ compliance and highlighted the different approaches of the Member States.

The stakeholder consultation confirmed that the enforcement of EU passenger rights legislation by NEBs is neither harmonised nor consistent. 67% (99 out of 148) of respondents strongly or somewhat agree that the problem is important, while 16% (23 out of 148) fully or somewhat disagree. In the OPC, 70% (117 out of 169) somewhat/fully agree with the importance of the statement that the enforcement of passenger rights varies greatly across the EU.

2.2.3Problem Driver 3: Passengers cannot submit their claims easily

Two EU level passenger representative organisations expressed the view that there are multiple barriers for passengers when trying to contact a carrier to submit a claim 76 . These include malfunctioning web forms, unavailable email addresses, broken links to claim forms, web forms not being available in the language of the passenger or a lack of clarity on the documents or information necessary to submit the complaint. In addition, a NEB indicated that it has received complaints from passengers about the difficulties of finding information on carriers’ websites, on where to direct complaints/claims, the appropriate forms to use and the languages in which they are explained. When facing these obstacles, passengers often give up, even if in theory they could exercise their rights.

Another reason why passengers do not submit complaints when their rights are not respected is the fact that most passengers are still not aware of their rights, even though carriers and terminal managers are obliged to inform passengers of their rights 77 .

The following problem drivers are related to problem 2: Insufficient protection of passengers during multimodal journeys, as shown in Figure 3 below:

Figure 2 – Link between Problem Drivers 4-5 and Problem 2

2.2.4Problem Driver 4: Passengers are insufficiently informed, assisted or cared for in the context of travel disruptions when performing a journey involving different transport modes

While still being relatively small, the size of the market for multimodal travel is expected to grow steadily, from 91 million passengers in 2019 up to around 103 million passengers for the EU-27 in 2030 and 150 million in 2050. Air-rail passengers represent over 60% of the total multimodal passengers, air-coach passengers above 30%, while the share of rail-coach passengers is limited to around 1% of the total number of multimodal passengers 78 . 

Multimodal travel can involve travelling with separate tickets that passengers buy separately (‘category C’ tickets). Alternatively, ticket vendors and tour operators can bundle separate tickets into a multimodal product on their own initiative and sell them to passengers in one single commercial transaction (‘category B’ tickets). A limited number of carriers also offer single contracts of carriage for a multimodal journey (‘category A’ tickets). The share of single multimodal contracts is estimated at around only 5% of the multimodal market 79 .

The following table also provides an estimation of the number of stakeholders affected by the multimodal market, in particular carriers throughout all transport modes, intermediaries and multimodal terminal operators.

Table 1: Number of stakeholders affected by multimodal travel

A relatively high number of passengers experience problems during multimodal travelling, especially in relation to missed connections. This is supported by the 2020 Eurobarometer survey, showing that of those respondents using a multimodal ticket in 2019, 25% experienced a problem when travelling, with 8% almost missing a connection due to a delay or cancellation and 9% actually missing a connection for this reason. 81 In this context, and as already highlighted above, it is important to note that the current level of protection of passengers when switching between modes would depend on the existence of a single contract of carriage covering the whole multimodal journey (category A), and the concrete terms and conditions of such contract.

In the targeted consultations, 62% of respondents (89 out of 145) considered as an important problem the fact that passengers are not protected by existing rights when switching between transport modes, while 18% (26 out of 145, mostly carriers for all modes of transport and their umbrella organisations) disagreed either fully or somewhat. The latter remarked that the multimodal market is still very limited and that it might be too early to regulate this sector. Conversely, passenger representative organisations and one rail umbrella organisation considered that the protection offered to passengers making multimodal journeys must be improved if the market for multimodal transport is to develop 82 .

2.2.5Problem Driver 5: Persons with disabilities or reduced mobility are not informed or assisted when switching between transport modes

The obligations on carriers and infrastructure managers to provide PRMs with information and assistance set out in the mode-specific rules on passenger rights do not apply in the case of multimodal travel, which particularly affects the assistance provided at connecting points 83 . This implies, for example, that PRMs are only assisted within the perimeter of an individual airport, railway station, bus terminal or port, but do not receive support beyond that (e.g. assistance from a railway station to an adjacent bus terminal); or that several operators and terminal managers would have to be contacted in order to ensure the assistance of PRMs during a given journey. The 2020 Eurobarometer survey also found that almost half of PRMs requesting assistance for a journey using more than one mode of transport were dissatisfied with the assistance they had received.

50% of respondents to the targeted stakeholder consultations (69 out of 138) agreed that the absence of assistance to PRMs when switching between transport modes is an important problem, with 16% (22 out of 138) somewhat disagreeing, 14% (19 out of 138) being neutral and 20% (28 out of 138) having no opinion on the matter. There is also widespread acceptance throughout different categories of stakeholders representing consumers, transport operators and infrastructure managers, that the information and assistance to PRMs switching between transport modes should be improved 84 .

The following problem driver is related to problem 3: Reimbursement rules are unclear when flights were booked via an intermediary, as shown in Figure 4 below:

Figure 3 - Link between Problem Driver 6 and Problem 3

2.2.6Problem Driver 6: Legal rules and implementation in practice differ for air passengers requesting reimbursement for a ticket that they booked via an intermediary

Regulation (EC) No 261/2004 stipulates passengers’ right to a reimbursement but stays silent on who shall reimburse the passenger. Intermediary ticket vendors are not included within the scope of the Regulation, only passengers and carriers are, which means that the onus is on the air carrier to communicate with and to reimburse the passengers in case of events triggering this right. However, many passengers have difficulties enforcing their right to reimbursement vis-à-vis the air carrier directly. De facto, many carriers (with the exception of large low-cost carriers with an exclusive direct (online) distribution model) ask passengers to request the reimbursement via the intermediary through which they booked 85 . The reason is that this is part of the service package offered by the intermediary, and the airlines may not have the passenger’s payment (or even contact) details for these tickets, and do not know the final price of the ticket that the passenger paid to the intermediary 86 . Industry rules support the ‘reversal of the payment flow’ method 87 , which, for tickets booked through credit cards, also avoids a credit card chargeback from the customer to the Merchant of Record intermediary 88 (where the intermediary is responsible for the financial transaction), and thus the risk to the airline of paying the reimbursement twice, or of airlines’ liquidities being frozen by credit card companies. 89 Therefore, the large majority of airlines operating in the EU reverse the payment flow for the reimbursement of tickets booked via intermediaries (representing approximately 92% of tickets booked via intermediaries and accounting for 416 million passengers in 2019), meaning that the money arrives with the Merchant of Record intermediary, which then needs to make the final reimbursement payment to the passenger.

When Merchant of Record intermediaries are involved, the passenger is usually asked by the airline to turn to the intermediary for reimbursement. Given this practice, which is not mirrored in the current air passenger rights, passengers face difficulties to enforce their rights towards the intermediary. Furthermore, passengers are often confused about who is responsible for what and when the payment of the reimbursement is due to arrive on their bank account. The coordinated investigation of the CPC authorities into airlines’ cancellation practices of 2020/2021 confirmed that in most cases where passengers booked their flights via an intermediary, airlines do not accept direct requests for reimbursement, claiming that this responsibility falls on the intermediary 90 . Consequently, they also usually do not offer to passengers who booked via an intermediary to request a direct reimbursement on their websites 91 .

2.3How likely is the problem to persist?

2.3.1Problem 1: Passengers do not fully benefit from their rights due to shortcomings in implementation and enforcement

Without EU intervention, the problem is likely to persist as not all NEBs dispose of effective tools to monitor compliance of operators, nor are they likely to acquire such tools. No evidence suggests that carriers or operators will publicise more information in the future, as their current hesitation to do so can be attributed to concerns about confidentiality and risk of losing passengers. As such, operators cannot be expected to be more willing in the future to provide NEBs with the information necessary to strengthen NEBs’ monitoring and enforcement activities. Additionally, passengers will still not have access to a quick and efficient complaint handling system. While the prospect of a competitive edge might incentivize some carriers and intermediaries to better practices and more transparency in complaint handling, the extent and the pace of such a market-driven process are uncertain. The hassle costs related to individual redress (e.g. time lost while searching for one’s passenger rights, submitting a complaint through a difficult procedure and later possibly finding out that the NEB is not authorised to make a decision which is binging for the transport operator) will continue to cause significant personal welfare loss and the loss of consumer confidence in the collective transport sector (because of the lack of transparency related to carriers and terminal managers compliance with passenger rights and the fear that passengers will not be respected in case of transport disruption) will also remain.

2.3.2Problem 2: Insufficient protection of passengers during multimodal journeys

As mentioned above, while still being relatively small, the size of the market for multimodal travel is expected to grow steadily, from 91 million passengers in 2019 up to around 103 million passengers for the EU-27 in 2030 and 150 million in 2050 92 . At the same time, transport operators are cautious as to the potential for growth in the availability of single contracts of carriage for multimodal journeys. Products and supporting mechanisms allocating liabilities in the event of disruption to connecting services, need to be economically viable for all involved. So far, these multimodal products are rare (an estimated 5% of the multimodal market as mentioned above) and take time to develop given the need for negotiation between different service providers. National policies to support such development are nearly inexistent 93 . Incentives to inform and assist passengers when they combine separate tickets for a multimodal journey – either at their own initiative or with the involvement of a ticket vendor - are also missing.

Hence, market-based solutions to address this problem are unlikely to be developed sufficiently rapidly to materially improve the experience of passengers, including PRMs, in the coming years. Consequently, passengers will still lack information on their rights before and during multimodal travel, and they will not be informed in real-time on possible travel disruptions and security alerts. They will not get assistance (e.g. reimbursement, re-routing, accommodation, meals and refreshments) in the event of a travel disruption when switching between transport modes and will have to fully bear the burden of such events. Finally, they will continue to face difficulties to complain to carriers and other possible relevant actors (e.g. terminal operators, ticket vendors) about the lack of information or assistance. The lack of a clearly designated authority to enforce such level of service provision during multimodal travel is likely to persist. Therefore, it is expected that the issues identified will not be resolved through the further expansion of this market segment in the foreseeable future.

2.3.3Problem 3: Reimbursement rules are unclear when flights were booked via an intermediary

The problem identified is likely to persist without EU intervention, given that market-based solutions are unlikely to develop. The current main market practice of reimbursements for indirect bookings has in fact diverged from the legal framework: the CPC action against airlines (see Annex 13) provides evidence that many airlines with an indirect distribution model first refer the passenger to the intermediary for the reimbursement. The fact that airlines deal with intermediary ticket vendors differently, depending on their distribution model, adds confusion for the passenger. This is unlikely to change in the future. It is also unlikely that intermediary ticket vendors will exit the market.

The CPC action on intermediaries 94 , that started in autumn 2022 and closed in June 2023, showed how difficult it is to solve these problems with voluntary commitments of intermediaries if the substantive law to be enforced is not clear enough. The unclear and inefficient reimbursement claim system will continue to lead to time lost by consumers when they try to find out whom to contact for their reimbursement through a trial-and-error approach and when the terms and conditions of (Merchant of Record) intermediaries set reimbursement deadlines from the intermediary to the customer (after receipt of the carrier’s payment) of more than 7 days, or do not provide any information on this at all.

When passengers who booked a ticket via an intermediary with a carrier with an indirect distribution model insist to receive the reimbursement from the carrier, they will most likely continue to face considerable hassle costs. Airlines will likewise incur considerable costs in this case. The only element for which the hassle costs could possibly reduce in the future concerns the airline’s identity check of the passenger who booked via a Merchant of Record intermediary. The possible use of European Digital Identity Wallets by private parties (provided for in the provisional political agreement of the Council and European Parliament on the core elements of a new framework for a European digital identity (eID) of 29/6/2023 95 ) could potentially lead to the future uptake of eIDs by the airline industry, instead of other identity checks which are more burdensome. These developments are however unlikely to compensate for the consumer personal welfare loss and risk of loss of consumer confidence in the transport sector.

3Why should the EU act?

3.1Legal basis

Article 91(1) of the Treaty on the Functioning of the European Union (TFEU) serves as the legal basis for the adoption of EU legislation related to a common transport policy. This provision is the legal basis for the passenger rights Regulations currently in force. Furthermore, pursuant to Article 100(2) TFEU the Union legislator may lay down appropriate provisions for sea transport.

3.2Subsidiarity: Necessity of EU action

The level of protection of passengers was rather limited before the passenger rights Regulations were adopted. A large number of carriers (not only airlines but also railway undertakings and shipping companies, and increasingly bus companies) provide their services in different Member States and even beyond. Harmonisation of passenger rights at EU level is therefore necessary to ensure a level playing field for all stakeholders involved in the provision of transport services (e.g. carriers, infrastructure managers (especially relevant for PRM), intermediaries etc.). Passengers must be able to assert their rights in the same manner and to benefit from the same protection regardless of the Member State where they travel. For these reasons, the problems mentioned above need action at EU level.

3.3Subsidiarity: Added value of EU action

The new measures related to enforcement would allow making existing rights more effective by making sure that NEBs’ enforcement practices would incentivise carriers, terminal operators and intermediaries to deliver the best protection to passengers and by removing obstacles that prevent citizens from effectively exercising their rights under EU law. The added value of passenger rights for multimodal journeys lies in the continuity of the passenger protection across the journey; protecting passengers travelling multimodal would be an additional contribution to the new approach promoted by the common transport policy and the European Green Deal to incentivise the use of more sustainable transport modes. Finally, the new measures will also contribute to enhance the protection for air passengers across the EU, ensuring that clear rules will be in place for air tickets booked via an intermediary.

4Objectives: What is to be achieved?

4.1General objectives

The general objective of this intervention is to ensure the proper functioning of the single market for passenger transport and to achieve a high level of consumer protection for passengers when travelling within one mode or when switching modes during their journey, by enabling carriers, intermediaries and (especially for PRM) terminal operators and national administrations to apply and enforce these rights in an efficient and effective manner.

4.2Specific objectives

The following specific objectives correspond to problem drivers 1-3, related to Problem 1: Passengers do not fully benefit from their rights due to shortcomings in implementation and enforcement, as shown in Figure 5.

Figure 4 - Link between Problem Drivers and Specific Objectives for Problem 1

SO1: Ensure effective and efficient enforcement across all Member States. This objective aims to ensure that NEBs have effective tools for the monitoring of operators’ compliance with passenger rights.

SO2: Ensure effective complaint handling for passengers. This objective focuses on providing passengers with a quick, simple and accessible system of complaint handling. The objective is to ensure that passengers can enjoy their rights to the fullest, which also means to be able to complain to the carriers, intermediaries and terminal operators if something has gone wrong during their travel.

The following specific objectives correspond to problem drivers 4 and 5, related to Problem 2: Insufficient protection of passengers during multimodal journeys, as shown in Figure 6.

Figure 5 - Link between Problem drivers and Specific Objectives for Problem 2

SO3: Increase protection of passengers facing travel disruptions in the context of multimodal journeys. The aim of this objective is to raise protection standards for passengers during a multimodal journey, in particular in the form of information, assistance and care.

SO4: Increase information for and assistance of persons with disabilities or reduced mobility when switching between transport modes. This objective aims to foster the protection of persons with disabilities or reduced mobility when they undertake a multimodal journey. In particular, it aims to improve the assistance of those passengers when they transfer from one transport mode to another during such a journey.

The following specific objective corresponds to problem driver 6, related to Problem 3: Reimbursement rules are unclear when flights were booked via an intermediary, as shown in Figure 7.

Figure 6 - Link between Problem drivers and Specific Objectives for Problem 3

SO 5: Ensure a clear reimbursement process when air passengers booked via an intermediary. This objective aims to ensure that the reimbursement process becomes clear for all actors involved (carriers, intermediaries and passengers).

5What are the available policy options?

5.1What is the baseline from which options are assessed?

The EU Reference scenario 2020 (REF2020) is the starting point for the impact assessment of this initiative 96 . The REF2020 takes into account the significant impacts of the COVID-19 pandemic on the transport sector. More detailed information about the preparation process, assumptions and results are included in the Reference scenario publication 97 . Building on REF2020, the baseline has been designed to include the initiatives of the ‘Fit for 55’ package proposed by the Commission on 14 July 2021 98 and the initiatives of the RePowerEU package proposed by the Commission on 18 May 2022 99 .

In terms of passenger rights, the baseline scenario assumes no further EU level intervention beyond the current Regulations in place 100 and the proposal to amend Regulation (EC) No 261/2004 on air passenger rights 101 , currently under discussion by the co-legislators. 

As regards the reimbursement of air tickets when booked via intermediaries, the baseline scenario includes:

-The possible use of European Digital Identity Wallets by private parties (provided for in the provisional political agreement of the Council and European Parliament on the core elements of a new framework for a European digital identity (eID) of 29/6/2023 102 ) that could potentially lead to future uptake of eIDs by the airline industry. This would most likely facilitate the airline’s check of the identity of the passenger. It is currently part of the additional information required by airlines when the ticket was paid by an intermediary on behalf of a passenger, and the passenger approaches the airline directly for a reimbursement.

-In case of insolvency of the entity which sold the passenger the air ticket, Regulation (EU) 261/2004 applies. The transport contract is always concluded between the passenger and the airline. The onus for the passenger’s reimbursement lies with the airline, except where it already transferred the reimbursement money to an intermediary which holds a valid mandate from the passenger to receive the airline’s reimbursement payment on his or her behalf. Such a mandate depends on national law and the terms and conditions of the contract between passenger and intermediary. If the airline goes bankrupt and did not yet pay out to the intermediary (with a valid mandate), the passenger becomes the creditor of the airline. If the intermediary goes bankrupt without having received the carrier’s reimbursement payment, the passenger can request it from the carrier directly.

-The Digital Services Act (DSA) 103 , that sets up a single point of contact for intermediaries 104 . The Consumer Rights Directive 2011/83/EU, Art. 6(1)c, stipulates that the trader is to provide the consumer with its telephone, fax and email address. The E-Commerce Directive, Art. 5(1)c, stipulates that the service provider is to provide the recipient of the service with an email address. However, these two articles do not apply to air carriers.

The baseline also incorporates foresight megatrends 105 and developments captured in the 2022 Strategic Foresight Report 106 . More specifically, it captures the trend of increasing demand for transport as population and living standards grow. The projected transport activity draws on the long-term population projections from Eurostat and GDP growth from the Ageing Report 2021 107  by the Directorate General for Economic and Financial Affairs.

The total number of passengers in the EU travelling by air, bus and coach, rail and waterborne transport is projected to grow from 13.4 billion in 2019 to 15.4 billion in 2030 and 19.8 billion in 2050 (15% increase for 2019-2030 and 48% increase for 2019-2050), following the recovery from the COVID pandemic. The number of passengers travelling by air would increase from 970 million in 2019 to 1.1 billion in 2030 and 1.4 billion in 2050 (9% growth for 2019-2030 and 41% for 2019-2050), maintaining a relatively stable share in the total number of passengers between 2019 and 2050. The number of passengers travelling by rail is projected to increase faster than for air (from 8.7 billion in 2019 to 9.7 billion in 2030 and 13.3 billion by 2050), driven in particular by the completion of the TEN-T core network by 2030 and of the comprehensive network by 2050, supported by the CEF, Cohesion Fund and ERDF funding, but also by measures of the ‘Fit for 55’ package that increase to some extent the competitiveness of rail relative to road and air transport. The number of passengers travelling by bus and coach is projected to increase from 3.3 billion in 2019 to 4.1 billion in 2030 and 4.6 billion by 2050, with the passengers travelling above 250 km representing around 11% of the total number of passengers travelling by bus and coach. The number of passengers travelling by waterborne transport would also increase in the baseline scenario, from 418 million in 2019 to 459 million in 2030 and 569 million in 2050. Drawing on the projected number of passengers, seat capacity and occupancy rates, the total number of passenger services by air transport, rail, bus and coach and waterborne transport are estimated to increase from 107 million in 2019 to 109.1 million in 2030 and 133.8 million in 2050.

Drawing on data for the historical period collected in the context of the exploratory study on passenger rights in the multimodal context 108 , the number of multimodal passengers is projected to increase from 91 million in 2019 to 103.6 million in 2030 and 150.9 million in 2050 in the baseline scenario. The air-rail passengers represent over 60% of the total multimodal passengers, air-coach passengers above 30%, while the share of rail-coach passengers is limited to around 1% of the total number of multimodal passengers. In terms of market size, the air-rail passengers represented 6.3% of the total number of passengers travelling by air in 2019 and their share is projected at 6.3% in 2030, following the recovery from the COVID pandemic, going up to 6.9% by 2050. The air-coach passengers represented around 0.9% of the total number of bus and coach passengers in 2019, going up to 1.2% by 2050 in the baseline scenario, while the rail-coach passengers represent below 0.05% of the bus and coach passengers over the whole time horizon. Expressed as share of the total number of passengers, multimodal passengers are estimated to increase from 0.7% in 2019 to 0.8% by 2050.

In the baseline scenario, the costs for airlines, bus and coach operators and the rail sector for the provision of passenger rights are projected to increase from EUR 15.7 billion in 2019 to EUR 16.8 billion in 2030 and EUR 20 billion in 2050, driven by the increase in the number of passengers over time.

The total number of PRM requests for air, bus and coach, rail and waterborne transport is projected to increase from 82.7 million in 2019 to 115.6 million in 2030 and 199.7 million in 2050, driven by the ageing population.

More details, by transport mode, are provided in section 2 of Annex 4.

5.2Description of the policy options

As a first step, a comprehensive list of possible policy measures was established after extensive consultations with stakeholders, expert meetings, and independent research in the context of the impact assessment support study and the Commission’s own analysis. This list was subsequently screened based on the likely effectiveness, efficiency and proportionality of the proposed measures in relation to the given objectives, as well as their legal, political and technical feasibility.

5.2.1Discarded policy measures 

Annex 6 presents the possible policy measures that were initially considered but were discarded following the screening/analysis mentioned above. A detailed overview of the reasons for discarding the policy measures can also be found in Annex 6.

5.2.2Retained policy measures and policy options

The retained policy measures have been grouped into policy options to address separately each of the three problems, as presented in the tables below. More detailed explanations of the measures included in each policy option are provided in Annex 7.

Measures and options addressing problem 1 (Passengers do not fully benefit from their rights due to shortcomings in implementation and enforcement)

Table 2 provides the links between the policy measures, policy options, problem drivers and specific objectives related to problem 1.

Table 2: Links between policy measures, policy options, problem drivers and specific objectives for problem 1

Both policy options envisage introducing into all other passenger rights Regulations certain measures already existing in Regulation (EU) 2021/782 for rail passenger rights or contained in the Commission’s 2013 proposal to amend Regulation (EC) No 261/2004 on air passenger rights. PM A.1, PM A.2, PM A.3 and PM A.6 are already applicable in the rail passenger rights Regulation. This means that these measures would only be proposed for non-rail carriers. These measures increase coherence of passenger rights between modes and Regulations, enabling passengers to exercise their rights and creating a level playing field for industry stakeholders.

The main difference between the two policy options is that PO 1.1 does not go further than the harmonisation with the rail passenger rights Regulation and with the proposed amendment for the air passenger rights Regulation, while PO 1.2 would introduce two additional and complementary measures which would be new for passenger rights of all modes.

PM A.1 is based on Regulation (EU) 2021/782 on rail passenger rights, Article 32(2). 49 out of 140 respondents to the targeted stakeholder consultation considered that this measure would bring a very strong or strong contribution. In particular, NEBs (66%, 29 out of 44) chose this response. At a dedicated expert group meetings some NEBs indicated that such a measure already exists under their national law, this is why for them it has little added value, but it could have a strong contribution for other NEBs. In addition, 50% (8 out of 16) of the passenger organisations consider that it would bring a very strong or strong contribution. At the same time 35 stakeholders indicated that this measure would bring slight contribution or no contribution at all, including mostly air carriers (83% of them, 14 out of 17) and carriers in other transport modes (35% of them, 7 out of 20).

PM A.2 is based on Regulation (EU) 2021/782 on rail passenger rights, Article 29. 34 out of 140 respondents to the targeted stakeholder consultation considered that this measure would bring a strong or very strong contribution. 50% of the consumer organisations (8 out of 16) and 50% of NEBs (22 out of 44) chose this response. At the same time 32% of stakeholders (46 out of 140) indicated that this measure would bring slight contribution or no contribution: mostly air carriers (94%, 16 out of 17) and other carriers (60%, 12 out of 20) subscribed to this response. 25% of the stakeholders replying to this question did not have an opinion.

PM A.3 is based on Regulation (EU) 2021/782 on rail passenger rights, Article 18(6), 18(5), 19(5) and 19(6). PRM associations expressed very strong support for this measure (other consumer associations had mixed views). 25 out of 44 (57%) NEBs that replied to this question in the targeted online survey expressed a favourable view towards this policy measure by claiming it would have a strong or very strong contribution. 24% of carriers that replied agreed that its contribution would be moderate. On the other hand, 65% of air carriers (11 out of 18) and 45% of other carriers (9 out of 19) opposed (very strongly) this policy measure.

PM A.4 is a new measure. It was inspired by ECA’s recommendation “to give the Commission mandate to perform quality control of the enforcement practices of NEBs”. However, stakeholders were divided: 41 out of 146 of the stakeholders (strongly) supported it (including 7 out of 8 consumer and passenger organisations that expressed its opinion and a majority of NEBs) while 39 out of 146 (almost all carriers, and 34% of the NEBs) (strongly) opposed the ECA recommendation. Accordingly, it was decided to assess the impacts of a slightly different policy measure which would require NEBs to perform their monitoring activities according to a risk assessment and would possibly allow the Commission to assess such risk assessments and to confirm whether the monitoring activities implemented by the NEBs reflect the risks they have identified.

PM A.5 is also a new measure. It emerged during the targeted stakeholder consultation when all EU-level consumer and passenger representative organisations highlighted 109 the need to do more to raise the awareness of passengers about their rights, in particular to get accurate information from transport operators on passenger rights when booking their journeys, when a disruption occurs and on the complaint handling mechanisms. Eurobarometer surveys also show that there is a lack of awareness of passengers on their rights, so there is a need for action. Accordingly, carriers and terminal operators will be obliged to improve the information to passengers about their rights ad on how to seek individual redress in particular at the time of booking and during journey disruptions with the view to raise awareness of passengers about those rights.

In relation to PM A.6, ADR bodies (3 out of 4) agree this measure would have a strong contribution. 9 of 14 (64%) infrastructure managers that replied to this question in the targeted online survey consider the measure to have a very strong or strong contribution. 22 of 46 (48%) NEBs that replied to this question in the targeted online survey showed their support towards the measure by claiming that it would have a strong or very strong contribution. Similarly, infrastructure managers (64% - 9 out of 14) consider the measure to have a very strong or strong contribution. Other stakeholders did not have such a favourable view of this measure: most airlines (63% - 12 out of 19) considered that it would bring no contribution, while ticket vendors (62% - 8 out of 13) and passenger organisation (50% - 8 out of 16) believe it would bring only a moderate contribution.

PM A.1, PM A.2 and PM A.4 contribute towards SO1 (ensure effective and efficient enforcement of passenger rights in all Member States). Concretely, carriers, terminal and infrastructure managers, ticket vendors and tour operators will have to provide the NEBs with relevant documents and information at the NEB’s request without undue delay (PM A.1) in order to help NEBs to carry out their monitoring tasks. For the same purpose, carriers and terminal managers will be required to establish service quality standards, implement a quality management system, and additionally carriers will be also required to publish reports on the results (PM A.2). PM A.4 also contributes to SO1 by requiring NEBs to perform compliance monitoring activities (e.g. on the spot audits and inspections, verifications, website reviews, dialogue with operators etc.) based on a risk assessment they would carry out. On that basis, it is ensured that NEBs take a proactive role in assessing the need for monitoring and oversight in their Member State. The specific design of the risk assessment will be left to the Member States, as they know the best their own transport systems, individual needs and transport operators active on their territory. The requirement of publishing them will enable the Commission to assess the monitoring activities of the NEBs, enhance transparency and would lead to a better level playing field for passengers and industry stakeholders alike.

PM A.3, PM A.5 and PM A.6 contribute towards SO2 (ensure effective complaint handling for passengers). The Commission will adopt standardised compensation and reimbursement forms available in all official languages and in accessible formats for persons with disabilities; the forms will help citizens to submit a complete file with all the relevant details, and operators will be obliged to accept these forms (PM A.3). As under the new rail passenger rights Regulation (EU) 2021/782, NEBs responsible for the other modes and for multimodal passenger rights will also be obliged to inform passengers about the right to approach ADR bodies to seek individual redress in cases where the NEBs themselves do not have an alternative dispute resolution function 110 (PM A.6). PM A.6 will require carriers and terminal operators to improve the information on passenger rights in particular at the time of booking and when a transport disruption occurs to increase the awareness of passengers about their rights. This policy measure emerged during the targeted stakeholder consultation when consumer and passenger representative organisations highlighted 111 the need to do more to raise the awareness of passengers about their rights, in particular to get accurate information from transport operators on passenger rights when booking their journeys, when a disruption occurs and on the complaint handling mechanisms.

Policy option 1.1 (PO 1.1)

The aim of this policy option – as a moderate policy option - is harmonising existing (for rail) or proposed (for air) enforcement and complaint handling rules.

NEBs will be able to request carriers, terminal and infrastructure managers, ticket vendors and tour operators to provide them with relevant documents and information without undue delay and in any event within one month from the receipt of the requests. NEBs will use such information both to carry out their general monitoring and enforcement tasks and to handle individual cases. This measure (PM A.1) already exists for rail passenger rights and it would be extended to the other transport modes.

On the basis of certain basic criteria established in the annex of the legislation to be adopted, carriers will be required (PM A.2) to establish standards on which their service quality will be measured (e.g. on the punctuality of their services, about the way they sell tickets to their customers, about how to measure consumer satisfaction, etc.). Carriers and terminal operators will have to monitor their performance on the basis of these standards: carriers will have to publish the results while terminal operators have to collect data about the results and send it to the responsible NEB if that NEB requests it. The information provided by carriers and terminal operators will help NEBs to plan and carry out their monitoring and enforcement authorities. Passengers will be able to compare the performance of different carriers and make informed decisions about which carrier to choose in the future. This measure also exists for rail passenger rights and it would be extended to the other transport modes.

The Commission will adopt an EU-wide standardised form for reimbursements and compensation requests via an implementing act. Carriers, ticket vendors and tour operators will be obliged to accept this form, but passengers will not be forced to use it. This measure (PM A.3) also exists for rail passenger rights and it would be extended to the other transport modes.

NEBs will have to inform passengers about the possibility to use alternative dispute resolution in case they do not handle individual complaints. This measure (PM A.6) also exists for rail passenger rights and it would be extended to the other transport modes.

Policy option 1.2 (PO 1.2)

This policy option contains all the policy measures listed in PO 1.1 and adds two policy measures which apply to all modes and contribute to SO1 (Ensure effective and efficient enforcement across all Member States) and SO2 (Ensure effective complaint handling for passengers).

First, NEBs will have to design and implement a risk assessment related to the operators’ compliance with passenger rights. On this basis, NEBs will have to perform compliance monitoring activities of the carriers, terminal operators, ticket vendors and tour operators corresponding to the findings of the risk assessment. Minimum requirements for NEBs monitoring programmes will be defined to ensure consistency at EU level and to ensure that operators perform according to passenger rights rules (PM A.4). Second, carriers and terminal operators will have to improve information on passenger rights to increase the awareness of passengers on their rights especially when booking their journeys and when a disruption occurs including on how to submit a complaint.

Measures and options addressing problem 2 (Insufficient protection of passengers during multimodal journeys) 

The policy measures included in the options addressing problem 2 are differentiated between ticket categories 112 . Table 3 provides the links between the policy measures, policy options, problem drivers and specific objectives related to problem 2.

Table 3: Links between policy measures, policy options, problem drivers and specific objectives for problem 2

All policy options aim to introduce measures to increase the level of protection of passengers undertaking a multimodal journey, including PRM, by mirroring measures which have already been implemented for travel with a single mode under the existing regulations on passenger rights (in particular Regulation (EU) 2021/782 on rail passengers’ rights and obligations). These options also take into account the outcomes and recommendations of the Commission’s exploratory study of 2019 on passenger rights in the multimodal context. 113  

Three policy measures are common to all policy options: PM B.1, PM B.7 and PM B.8 and contribute to SO3 (Increase protection of passengers facing travel disruptions in the context of multimodal journeys). Concretely, carriers, ticket vendors/tour operators and multimodal hub managers should provide guidance to all passengers (categories A, B and C) on minimum connecting times and other useful information when switching between modes of transport, e.g. on accessibility of transport infrastructure. The information to be provided is established on an EU-wide basis and would apply to all the above mentioned actors (PM B.1). Each carrier offering single transport contracts for multimodal journeys (category A tickets), each ticket vendor and tour operator offering combined tickets for such journeys (category B tickets) and each multimodal hub manager should also provide for an online and offline complaint-handling mechanism to deal with any issues faced by multimodal passengers (categories A, B and C - PM B.7). In addition, Member States would have to designate an authority to handle complaints from multimodal passengers (categories A, B and C). This authority would not need to be a new one, as this competence could also be added to (one of) the existing NEBs. Where the NEB and the complaint-handling body are different in a given Member State, they would have to cooperate by sharing information and identifying a lead body that serves as a single point of contact (PM B.8).

Furthermore, PM B.1 would also contribute to SO4 (Increase information for and assistance of persons with disabilities or reduced mobility when switching between transport modes), as carriers, ticket vendors/tour operators and infrastructure managers would have to provide guidance to passengers on the accessibility of transport infrastructure when switching between modes of transport (categories A, B and C). In addition, PM B.7 and PM B.8 would also contribute to SO4, where they ensure that PRM would be able to submit a complaint through the online and offline complaint-handling mechanism of the above mentioned undertakings (PM B.7), respectively could turn to a NEB (PM B.8) (categories A, B and C for both PMs).

With regard to PM B.1 on providing useful information to passengers when switching between modes of transport, airlines and their representative organisations remarked, during the dedicated stakeholder workshop, the difficulties in obtaining information that they often do not have (e.g. on connecting times), and the increase in the operational costs related to the required changes to the IT systems supporting booking arrangements and to additional resources needed to identify the mentioned information. On the other hand, ticket vendors are generally supportive of the introduction of a measure encouraging carriers and ticket vendors to provide passengers with information such as time schedules on every part of their multimodal trip. One organisation of airports and one organisation for rail stations stressed the importance of adequate communication channels in this context.

As regards PM B.7 on the establishment of offline and online complaint handling mechanisms by industry stakeholders, 56 out of 136 respondents (41%) to the targeted stakeholder survey stated that this measure would provide a (very) strong contribution to solving the problem, of which 11 out of 16 passengers and consumer organisations (69%), 3 out of 3 PRM organisations, 3 out of 4 ADR bodies (75%), 6 out of 11 infrastructure managers (54%) and 25 out of 42 NEBs (60%). On the other hand, 10 out of 13 air carriers (76%), 11 out of 25 carriers for other modes (44%) and 4 out of 11 infrastructure managers (36%) replied that this measure would bring a slight or no contribution. On PM B.8 on the designation of a national authority to handle multimodal complaints, 43 out of 144 respondents to the targeted stakeholder survey (30%) agreed that this measure would bring a (very) strong contribution to solving this problem, including 9 out of 17 passengers and consumer organisations (57%), 3 out of 3 PRM organisations, and 17 out of 42 NEBs (40%). On the other hand, 5 out of 12 air carriers (42%), 9 out of 25 carriers for other modes (36%) and 8 out of 42 NEBs (20%) consider that this measure would only bring a slight or no contribution.

Policy Option 2.1 (PO 2.1)

The objective of PO 2.1 is to provide passengers with all ticket categories a basic level of protection to ensure that they receive information and assistance when they undertake a multimodal journey. This policy option aims at providing some basic rules, in particular for passengers having concluded a single contract of carriage with a carrier for a multimodal journey (category A), except where these contracts concern journeys with an air leg. 114 For the more frequent cases of passengers having separate tickets (whether they were bundled by intermediaries (category B) or by passengers themselves (category C)), the policy measures would ensure that carriers, intermediaries and terminal operators provide useful information to all passengers, e.g. on the type of ticket they bought and on minimum connecting times (PM B.1). Under PO 2.1, passengers having a single contract of carriage for a multimodal journey (category A) would be granted a number of key rights, in particular the right to have pre-purchase information on a number of elements relevant to the journey, the right to choose between reimbursement or re-routing in the event of a missed connection, as well as the right to care (e.g. refreshments, meals, accommodation). In addition, PRM would have a right to non-discriminatory transport contract conditions for single contracts for multimodal journeys, and those contracts should entail a right to free assistance of PRM (PM B.3a). This measure would therefore address both SO3 and SO4.

With regard to PM B.3a, 73 out of 134 (54.5%) of stakeholders that replied to this question during the targeted consultation consider that the introduction of a right to reimbursement or re-routing for passengers having a single contract of carriage would provide a strong or very strong contribution to solving the problem. In particular, passengers and consumer organisations (13 out of 16 – 81%), intermediary ticket vendors (9 out of 11 – 82 %) and NEBs (28 out of 42 – 66%) consider that such a measure would bring a (very) strong contribution to solving the problem, while air carriers (7 out of 12 – 58%) and carriers for other modes (13 out of 25 – 52%) believe that such a measure would have a slight or no contribution. A similar picture can be drawn with regard to the introduction of a right to care, where 70 out of 133 (52.6%) stakeholders responding to this question during the targeted stakeholder consultation consider that introducing such a measure for passengers having a single contract of carriage would provide a strong or very strong contribution to solving the problem. In particular, 13 out of 16 (81%) passengers and consumers organisations; 7 out of 10 (70%) intermediary ticket vendors; and 28 out of 45 (67%) NEBs consider that such a measure would bring a (very) strong contribution to solving the problem, whereas most carriers for air (7 out of 12 – 58%) and almost half of carriers for other modes (12 out of 25 – 48%) consider that such a measure would bring a slight or no contribution to solving the problem.

Policy Option 2.2 (PO 2.2)

This option aims at providing a more comprehensive level of protection for passengers travelling in a multimodal context than PO 2.1. In particular, it is foreseen under PO 2.2 that passengers (category A and B) should get real-time information on disruptions and possible next connections during the journey (where technically feasible). The obligation to provide real-time information would not apply to SMEs (PM B.2). In addition, passengers having booked a multimodal journey comprising of separate tickets by means of a single commercial transaction through a ticket vendor or tour operator (category B) would be better protected. In case the intermediary does not inform the passengers correctly that they bought separate tickets, the intermediary would be liable and owe the passenger a right to pre-purchase information, a right to reimbursement and a penalty of 75%of the ticket price (PM B.4a). 115  

Whereas PM B.2 and PM B.4a would tackle SO3, PO 2.2 would also see the introduction of rules on the establishment of “Single Points of Contact” (SPC) to ensure assistance to PRM when switching between modes at multimodal passenger hubs in urban nodes and possibly beyond (PM B.5 and PM B.6 – both categories A, B and C), thereby contributing to achieving SO4. The terminal manager(s) and carriers operating at the multimodal passenger hub would have to cooperate to set up the SPC. These hubs are connection points between at least two transport modes for passengers, where travel information, access to public transport and transfers between modes are ensured (i.e. specific airports, railway stations, ports or bus terminals). The SPC would accept individual requests for assistance at multimodal passenger hubs and communicate these to terminal operators and carriers.

As regards PM B.2 (provision of real-time information), one consumer organisation argued that in case of travel disruptions, intermediaries should be held liable to inform consumers in real-time and to inform them on the possible re-routing options. Airlines and their representative organisations highlighted the difficulties in providing real-time information on journey disruption where passengers booked via a ticket vendor. One rail carrier referred to current technical limitations making it difficult to implement this measure. Ticket vendors specified that such a measure would only be feasible if carriers were obliged to share information with intermediaries. 

With regard to PM B.4a, 39 out of 133 stakeholders (29.3%) that contributed during the targeted stakeholder consultation believe that introducing a right to reimbursement for passengers having a ticket category B, on the condition that ticket vendors/tour operators did not properly inform them of the separate nature of the transport contracts sold to them, would bring a (very) strong contribution to solving the problem (including 43% of NEBs – 18 out of 41 - and 32% of passengers and consumer organisations – 5 out of 16). At the same time, 41 out of 133 stakeholders (30.8%) stated that such a measure would bring a slight or no contribution (including 67% of air carriers – 8 out of 14; 40 % of carriers for other modes 10 out of 25; 55% of intermediary ticket vendors – 6 out of 11; and 25% of passengers and consumer organisations – 4 out of 16).

As regards the introduction of “Single Points of Contact” for PRM (PM B.5 and B.6), 60 out of 143 stakeholders (42%) consider that this would (very) strongly contribute to solving the problem, while 50 out of them (35%) consider that such a measure would bring only a slight or no contribution. It follows from the targeted stakeholder consultation that views on the matter are mixed throughout all stakeholder categories.

Policy Option 2.3 (PO 2.3)

This option aims to introduce a further level of protection for multimodal passengers compared to PO2.2. In particular, this option would bring an additional right to passengers having a single contract of carriage (category A) where they miss a connection during a multimodal journey compared to what is provided under PM B.3a and would therefore come on top of the right to reimbursement/re-routing, the right to care and the right to PRM assistance. This additional right would consist of the entitlement for a passenger to conclude an alternative transport contract with other transport providers where a carrier does not make provision for the continuation of a passenger’s journey within a defined time limit, and to the reimbursement of the costs incurred by the passenger to this effect (PM B.3b). In addition, this option would provide stronger sanctioning rules in case ticket vendors and tour operators do not inform passengers having category B tickets correctly about the separate tickets they received: passengers would be protected as if they had bought a single ticket with a full set of rights (i.e. right to reimbursement or re-routing, right to care, right to conclude an alternative contract, right to non-discrimination and free assistance for PRM). Ticket vendors and tour operators would however be exempted from any liability where they properly informed passengers of the separate nature of the tickets (PM B.4b).

The targeted stakeholder consultation on PM 3b shows that 60 out of 134 respondents (44.8%) would bring a (very) strong contribution to solving the problem (including 81% of passengers and consumer organisations – 13 out of 16; 64% of intermediary ticket vendors – 10 out of 11; and 45% of NEBs – 19 out of 42), while 33 out of 134 respondents (26.2%) stated that this would bring a slight or no contribution (including 75% of air carriers – 9 out of 12; and 60 % of carriers for other modes – 15 out of 25). On PM B.4b, 55 out of 134 stakeholders (41%) that replied to this question consider that this would (strongly) contribute to solving the problem (including 91% of intermediary ticket vendors – 10 out of 11; 45% of NEBs – 19 out of 42; and 32% of passengers and consumer organisations – 5 out of 16), while 39 out of them (29.1%) believe that such a measure would bring a slight or no contribution (including 92% of air carriers – 11 out of 12;, 36% of carriers for other modes – 9 out of 25; and 44% of passengers and consumer organisations – 7 out of 16).

Table 4 summarises the ramifications of each of the policy options for every type of multimodal ticket.

Table 44: Overview of policy options and policy measures per multimodal ticket category

Measures and options addressing problem 3 (Reimbursement rules are unclear when flights were booked via an intermediary)

Table 5 provides the links between the policy measures, policy options, problem drivers and specific objectives related to problem 3.

Table 5: Policy measures, policy options, problem drivers and specific objectives for problem 3

Three policy options have been developed to address problem 3 and contribute to SO5. They provide clarity to all parties concerned (passengers, air carriers, intermediaries) on the reimbursement process and responsibilities. All options foresee obligations on carriers and intermediaries to inform passengers about the reimbursement process. They complement what is already foreseen in the Commission proposal of 2013 to revise rules in the air transport sector 117 on information obligations during disruptions and passenger claims.

Policy Option 3.1 (PO 3.1)

PO 3.1 foresees that the passenger may only request the reimbursement from the carrier. This option reflects best the current legal situation in the sense that it is the air carrier’s responsibility to reimburse the passenger. The option implies that intermediaries must enable passengers to do so, by providing them with the necessary data 118 , i.e. usually the carrier’s booking reference or the carrier’s e-ticket number or the passenger name record (PNR) number 119 . 

In the targeted stakeholder consultation, 9 out of 17 (53%) consumer organisations that participated supported this option, as well as 17 out of 30 (57%) NEBs. 17 out of 18 (94%) airlines and 7 out of 14 (50%) intermediaries claimed that this option 120 would not bring any contribution, while 5 out of 14 (35%) ticket vendors consider that the measure has a very strong or strong contribution. The airlines opposing this option do so because administrative costs would increase for them: the requests addressed to airlines would need to be dealt with mostly in a manual way (need for identification, bank account, checking whether the passenger launched a credit card chargeback as well). Intermediaries which oppose it do so because they want to continue processing their customers’ reimbursements and retaining the exclusive relationship with them 121 . The credit card companies involved in the consultation process stressed the importance of holding the “Merchant of Record” (actor responsible for the processing of the payment) liable for the reimbursement, using the same channel for the purchase of the ticket, in line with the “reversal of the original payment flow” principle 122 . PO 3.1 is not in line with this principle.

Policy Option 3.2 (PO 3.2)

Option 3.2 foresees that the carrier can decide whether the passenger has to request the reimbursement from the intermediary (provided the intermediary agrees to this) or the carrier (in this case, the procedure is the one outlined under PO 3.1). In both cases, the reimbursement process is free of charge for the passenger. The carrier can take different decisions on the way forward involving particular or all intermediaries 123 . This option reflects best the different ticket distribution models of air carriers currently being practiced on the market: some (the majority) do involve intermediaries, and some do not (or prefer not to), and how air carriers currently reimburse passengers. Under the intermediary procedure, a new, separate payment deadline of 7 days for the Merchant of Record intermediary is introduced: the carrier pays the intermediary within 7 days, after which the intermediary pays the passenger within an additional 7-day period 124 .

The carrier remains ultimately responsible: if the carrier decided in favour of processing the reimbursement via the intermediary and did not pay the intermediary in time, with the result that the intermediary did not pay the passenger within 14 days, the passenger has the right to request the reimbursement from the carrier. In this case, as in PO 3.1, the intermediary needs to provide the passenger with the data needed to request the reimbursement from the carrier. If the intermediary received the carrier’s reimbursement and did not reimburse the passenger within 14 days, the passenger can also request the reimbursement from the carrier.

In the targeted stakeholder consultation, the procedure via the intermediary 125 (without any pre-financing by the intermediary) was supported by 18 of 19 (90%) carriers that responded to this question, 12 of 13 (93%) intermediaries, 11 of 30 (37%) NEBs, 4 of 6 (67%) national public authorities, and 10 of 17 (59%) passenger and consumer organisations. A carrier umbrella organisation and intermediaries and their associations have advocated for an additional 7-day timeframe for the situation when an additional financial transaction by the intermediary to the passenger is required, which this option foresees. For the case where the airline does not reimburse the intermediary in time, an association of intermediary ticket vendors asked for the intermediary to be able to choose whether to pre-finance the reimbursement, or to refer the customer to the airline for the reimbursement, which PM C4 also foresees.

Policy Option 3.3 (PO 3.3)

PO 3.3 allows the passenger to choose to request the reimbursement either to the intermediary or to the carrier, but in the latter case, the intermediary may charge a fee for processing the reimbursement request (PM C.2b). The procedure for the case that the passenger chooses to go via the intermediary is the same as the intermediary procedure under PO 3.2; for the carrier-only procedure, it is the same as under PO 3.1.

This option comes closest to the proposal of a European consumer organisation 126 , namely “joint and several liability” between the online intermediaries and the transport operators, allowing consumers to direct their claim to both. However, the Commission did not retain the principle of joint and several liability and discarded this measure (see annex 6 for reasons), but chose to retain the principle of the passenger being allowed to approach either of the two (air carrier or intermediary). PO 3.3 was not part of the stakeholder consultation. It can be expected that, similar to PO 3.1, airlines which currently use the reversal of the payment flow method would, in general, oppose this option, as it would most likely increase the amount of direct reimbursement requests made to them (and possibly to intermediaries at the same time). There would also be an increased risk of double payments by the airlines.

Intermediaries which want to retain the exclusive relationship with the customer would possibly also be against this option (but still favour it over PO 3.1.), as a certain percentage of passengers who, under the baseline, would have their reimbursement request processed by the intermediary, might choose the carrier instead. A positive point for them would be the possibility to charge fees for processing the refund request. In a position paper, the European umbrella association of online intermediaries disagreed with any legislation restricting the commercial decision of intermediaries whether to charge a fee or not for the refund request.

6Impacts of the policy options

This section summarises the main expected economic, social and environmental impacts of each policy option (PO) 127 . The proposed measures are assumed to be implemented from 2025 onwards, so the assessment has been undertaken for the 2025-2050 period and refers to EU27. Costs and benefits are expressed as present value over the 2025-2050 period, using a 3% discount rate. Further details on the methodological approach, including the assumptions used for the estimations and detailed tables on costs and costs savings by policy option, measure and stakeholder group for 2025-2050 and individual years (2025, 2030 and 2050) relative to the baseline are provided in Annex 4 (section 3).

6.1Economic impacts 

This section provides the economic impacts of the policy options on carriers, terminal operators, intermediaries, public authorities, claim agencies and passengers and consumers. It also provides an assessment of impacts on SMEs, functioning of the internal market and competition, digitalisation and territorial impacts. The assessment of economic impacts draws on multiple data sources, including the targeted stakeholders’ consultation (interviews and survey) and public consultation, and findings from desk research in the context of the impact assessment support study.

6.1.1Impacts on carriers

It has been estimated that a total of 4,733 carriers are affected by this initiative: 3,778 are bus and coach operators, 523 waterborne transport operators, 238 railway undertakings and 149 air carriers (section 2.2 of Annex 4 provides details on the sources of the data used). The number of operators by transport mode are assumed to remain stable over time. New rules applying to air carriers will apply to EU and non-EU carriers operating flights departing from an airport located on the territory of an EU Member State.

6.1.1.1Administrative costs for carriers

Options related to enforcement (problem area 1). Both PO 1.1 and PO 1.2 are expected to lead to administrative costs for air, bus and coach and waterborne carriers, relative to the baseline. No additional costs are envisaged for rail carriers, since the respective obligations are part of the baseline. These costs are generated by the requirement to report by carriers (PM A.2) on the result of the implementation of the quality standards set up under the policy measure and are expected to lead to recurrent administrative costs estimated at EUR 5.1 million per year from 2025 onwards (EUR 34,782 for air carriers, EUR 4.4 million for bus and coach operators and EUR 0.6 million for waterborne transport operators), amounting to EUR 93.1 million expressed as present value over 2025-2050 (EUR 640 thousand for air carriers, EUR 81.2 million for bus and coach operators and EUR 11.2 million for waterborne transport operators). The reason for the high costs for the bus and coach sector, is the relatively high number of operators (3,778 bus and coach operators) out of the 4,450 carriers affected by PM A.2 (149 air carriers, 3,778 bus and coach operators and 523 waterborne carriers).

The administrative costs per carrier are however estimated to be limited, at EUR 1,136 on average per year (EUR 233 on average per year per air carrier and EUR 1,167 on average per year per bus and coach and waterborne transport operator). The proposed reporting obligations for operators are essential to ensure proper monitoring and enforcement of passenger rights by the NEBs. They directly address shortcomings identified by the European Court of Auditors in its report. They will also allow passengers to make informed decision about which carrier to choose based on their record of complying with passenger rights. More transparency brought by these reports will increase competition between carriers and make an impetus for them to better comply with passenger rights.

Options related to multimodal passenger rights (problem area 2). Policy options PO 2.2 and PO 2.3 are expected to lead to small recurrent administrative costs for carriers, estimated in total at EUR 6,770 per year from 2025 onwards (EUR 467 for air carriers, EUR 6,069 for bus and coach operators and EUR 233 for waterborne carriers) or EUR 124,649 expressed as present value over 2025-2050 relative to the baseline (EUR 8,596 for air carriers, EUR 111,754 for bus and coach operators and EUR 4,298 for waterborne transport operators). These costs are associated to the obligation on carriers to provide real-time information to passengers (PM B.2) 128 . Only a small number of carriers would be affected (29 carriers in total, of which 2 air carriers, 26 bus and coach operators and 1 waterborne transport operator) due to the SME exemption applied to this measure. The administrative costs per carrier are estimated to be limited, at EUR 233 on average per year per carrier.

Options related to intermediaries (problem area 3). When reimbursements are carried out by air carriers, i.e. not via the Merchant of Record intermediary who booked the tickets, the former are expected to incur additional recurrent administrative costs associated with processing manual reimbursements (as automatic reversal of payment is not possible). This is expected to lead to recurrent administrative costs under PO 3.1 (EUR 73.9 million in 2025, EUR 80.6 million in 2030 and EUR 104.1 million in 2050) 129 and, to a lesser extent, under PO 3.3 (EUR 14.8 million in 2025, EUR 16.1 million in 2030 and EUR 20.8 million in 2050) 130 . In PO 3.2, no additional recurrent administrative costs for carriers are projected as it is expected that the number of requests for reimbursement to carriers remains unchanged compared to the baseline.

In addition, limited one-off administrative costs are expected in PO 3.1, PO 3.2 and PO 3.3 to update the information disclosed to passengers on their reimbursement process. These costs are estimated in total at EUR 69,563 in 2025 for the 149 air carriers affected, or EUR 467 per air carrier.

Expressed as present value over 2025-2050, total one-off and recurrent administrative costs for air carriers are estimated at EUR 1.6 billion in PO 3.1, at EUR 0.07 million in PO 3.2 and EUR 323.5 million in PO 3.3.

6.1.1.2Adjustment costs for carriers

Options related to enforcement (problem area 1). Under both PO 1.1 and PO 1.2, carriers are expected to incur one-off adjustment costs to establish service quality standards and to implement the quality management system (PM A.2) 131 , amounting in total at EUR 10.2 million in 2025 (see Table 6). Of these, approximately EUR 8.8 million are costs for the bus and coach sector, EUR 1.2 million for the waterborne sector and EUR 174 thousand for all air carriers. Per carrier, they are estimated at EUR 2,334 on average for the bus and coach and waterborne transport operators and at EUR 1,167 for air carriers.

Additionally, adapting carriers’ complaint handling systems to be able to handle standardised reimbursement and compensation claims (PM A.4) is estimated to lead to one-off adjustment costs of EUR 519 thousand in PO 1.1 and PO 1.2, assuming half a working day per carrier to adjust their information systems. Costs for rail carriers are not considered as they are already subject to this obligation under the baseline. Of these, approximately EUR 441 thousand are costs for bus and coach operators, EUR 61 thousand for waterborne transport operators and EUR 17 thousand for air carriers. Per carrier, the one-off adjustment costs are estimated at EUR 117 in 2025.

Moreover, PO 1.2 also requires carriers to adapt their communication systems to improve the provision of information to passengers about their rights especially when booking the ticket and when a disruption occurs (PM A.6) which is estimated to lead to EUR 5.3 million one-off adjustment costs, relative to the baseline 132 . Of these costs, approximately EUR 4.4 million are incurred by bus and coach operators, EUR 610 thousand by waterborne transport operators, EUR 66 thousand by rail operators and EUR 174 thousand by air carriers.

Overall, PO 1.1 is expected to lead to one-off adjustment costs estimated at EUR 10.7 million and PO 1.2 at EUR 16 million in 2025 (see Table 6). The higher costs in PO 1.2 are explained by PM A.6, which is only included in this option.

Options related to multimodal passenger rights (problem area 2). Under PO 2.1, carriers would be required to provide guidance to passengers on minimum connecting times and other useful information when switching between modes of transport (PM B.1); would have to ensure a basic set of rights for passengers holding a single contract of carriage (category A) (PM B.3a); and would have to establish an online and offline complaint-handling mechanism (PM B.7). The total adjustment costs for PO 2.1 are estimated at EUR 20.6 million for all carriers, expressed as present value over 2025-2050.

PO 2.2 leads to higher adjustment costs, estimated at EUR 35.2 million expressed as present value over 2025-2050 for all carriers, generated by the requirement that carriers provide real-time information to passengers (PM B.2) 133 and by an essential set of rights for passengers having bought separate tickets from a ticket vendor/tour operator for a multimodal journey (PM B4.a). Finally, PO 2.3 leads to the highest adjustment costs for all carriers, estimated at EUR 38.9 million expressed as present value over 2025-2050, which is justified by the fact that it enhances the package of rights to both ticket categories A and B passengers (PM B.3b and PM B4.4b).

Out of the total adjustment costs presented above, one-off costs for all carriers represent EUR 0.12 million in PO 2.1, and around EUR 14.7 million in PO 2.2 and PO 2.3.

Options related to intermediaries (problem area 3). No adjustment costs for carriers are expected due to PO 3.1, PO 3.2 and PO 3.3.

Table 6: Recurrent and one-off costs for carriers for policy options under problem area 1, expressed as present value over 2025-2050 relative to the baseline, in million EUR (2021 prices)

Source: PWC, TIS and Steer (2023), Impact assessment support study

Table 7: Recurrent and one-off costs for carriers for policy options under problem area 2, expressed as present value over 2025-2050 relative to the baseline, in million EUR (2021 prices)

Source: PWC, TIS and Steer (2023), Impact assessment support study

Table 8: Recurrent and one-off costs for carriers for policy options under problem area 3, expressed as present value over 2025-2050 relative to the baseline, in million EUR (2021 prices)

Source: PWC, TIS and Steer (2023), Impact assessment support study

6.1.1.3Benefits for carriers

Options related to enforcement (problem area 1). PO 1.1 and PO 1.2 offer indirect benefits for carriers. More specifically, PM A.1 will allow NEBs to deal with non-compliance faster as they can request documents needed within clear deadlines from all involved, which will lead to quicker and more efficient procedures for the NEBs which will also help carriers. PM A.2 will lead to increased transparency about the compliance of all operators. As carriers will be obliged to publish reports 134 on their service quality performance, including customer satisfaction and compliance with passenger rights, passengers will have an increased insight into the different carrier’s performance, and be able to use this information to decide which carrier to use. Compliant operators can benefit from this transparency and may gain a competitive advantage thanks to their good reputation, as passengers will be more likely to choose a well performing carrier over a carrier which shows lower customer satisfaction and compliance rates. If carriers will use the common form for reimbursement and compensation requests foreseen in PM A.3 as a model to design their IT systems for handling such requests, carriers will then have the necessary information faster and the cooperation with the NEBs and ADR bodies regarding such requests will also have the potential to become more efficient. If NEBs inform passengers regularly about ADR as required in PM A.6, this may save carriers litigation costs, because ADR procedures tend to be much less expensive, not only for passengers, but also for operators 135 .

The benefits for carriers in PO 1.2 are expected to be higher than in PO 1.1. PM A.4 would allow a level playing field for operators because their compliance costs would be more similar: currently compliance cost depend on a great extent whether the NENs supervising the carrier in question are more passive or lenient or active and very stringent. Published risk assessments, which NEBs will base their monitoring on, will allow carriers to know what parameters they are judged upon and this will enable them to more effectively comply and thus prevent having to allocate resources to the additional monitoring by NEBs. Additionally, PM A.5 will enable passengers to submit more well-informed claims, as they become more knowledgeable on the rights. This will add to the efficiency of the carriers’ internal claims handling procedures, as passengers are more likely to provide all the necessary information with the initial claim, which will reduce the time carriers spend on the claim. Additionally, more well-informed passengers are less likely to make unjustified claims due to uncertainty of their rights, which will again reduce time spend by carriers on claims.

Options related to multimodal passenger rights (problem area 2). PO 2.2 and PO 2.3 offer indirect benefits to carriers. The proposed measures specifically target category B tickets (PMs B.4a and B.4b) and put the onus for information to passengers and liability in the event of missed connections during a multimodal journey on ticket vendors and tour operators.

In addition, all policy options (PO 2.1, PO 2.2 and PO 2.3) are expected to result in hassle costs savings for multimodal transport operators due to less time spent for handling complaints (PM B.7). Under a conservative approach, the hassle costs savings for multimodal transport operators are estimated at EUR 35.3 million expressed as present value over 2025-2050 relative to the baseline 136 .

Options related to intermediaries (problem area 3). PO 3.2 offers the substantial indirect benefit to carriers that they will be able to (continue to) invest in the reimbursement procedure for indirect bookings that best suits their business model – even on the level of particular intermediaries, if they want to. If they choose the intermediary procedure, they will be able to refuse to process direct requests by passengers and benefit from the easier and cheaper ‘reversal of the payment flow’, as long as they pay the intermediary within the deadline (and the intermediary also respects its payment deadline). If they choose the carrier-only procedure, they will be able to refuse to cooperate with intermediaries for the reimbursement, which is particularly relevant for airlines which do not authorise or do not prefer using intermediaries (and intermediaries purchase their tickets nevertheless, on behalf of the passenger). PO 3.3 does not offer this benefit of the carrier’s choice of procedure, as the passenger can choose. PO 3.1 is only of benefit to the (minority of) air carriers which currently choose to carry out the reimbursement procedure fully on their own. PO 3.2 is also very well suited for a carrier with an exclusive direct distribution model, which can decide not to involve intermediaries. Intermediaries whom the carrier did not authorise to carry out the reimbursement will no longer be able to include the reimbursement in their business model and circumvent the carriers’ prohibition or dislike of involving them. Both carrier and intermediary will need to clearly communicate the carrier’s decision through the information obligation. PO 3.2 and PO 3.3 contain rules that facilitate the B2B relationship of airlines with intermediaries for the processing of reimbursements.

6.1.2Impacts on terminal operators

6.1.2.1Administrative costs for terminal operators

Options related to enforcement (problem area 1). As regards PO 1.1 and PO 1.2, PM A.2 will require terminal operators to report at the request of NEBs about the results of the implementation of their quality standards. This will add administrative costs for terminal operators. Based on the assumption that this would require 5 additional working days per year for each of the 546 terminal operators, the recurrent administrative costs per year are estimated at EUR 127 thousand, or EUR 2.3 million expressed as present value over 2025-2050 (see Table 9). Per terminal operator, they are estimated at EUR 233 per year.

Options related to multimodal passenger rights (problem area 2) and intermediaries (problem area 3). None of the policy options related to multimodal passenger rights (PO 2.1, PO 2.2 and PO 2.3) or intermediaries (PO 3.1, PO 3.2 and PO 3.3) are expected to lead to additional administrative costs for terminal operators.

6.1.2.2Adjustment costs for terminal operators

Options related to enforcement (problem area 1). Under both PO 1.1 and PO 1.2, the establishment of service quality standards and the implementation of a quality management system (PM A.2), is expected to lead to one-off adjustment costs for terminal operators of EUR 1.3 million 137 . In addition, PO 1.2 leads to one-off adjustment costs for adapting terminal operators’ communication systems to better inform passengers about their rights, especially when booking a ticket or when a transport disruption occurs (PM A.5), estimated at EUR 637 thousand 138 . In total, PO 1.1 is estimated to result in one-off adjustment costs of EUR 1.3 million for terminal operators relative to the baseline, and PO 1.2 at costs of EUR 1.9 million. The higher costs in PO 1.2 are explained by PM A.5, which is only included in this option (see Table 9).

Options related to multimodal passenger rights (problem area 2). Under all options (PO 2.1, PO 2.2 and PO 2.3) terminal operators acting as multimodal hub managers are required to provide guidance to passengers on minimum connecting times and other useful information when switching between modes of transport (PM B.1), and to establish an online and offline complaint-handling mechanism (PM B.7). The one-off adjustment costs due to PM B.1 are estimated at EUR 0.2 million in 2025 and the recurrent adjustment costs due to PM B.7 at EUR 49,488 per year (EUR 0.9 million expressed as present value over 2025-2050) relative to the baseline (see Table 10).

In addition, PM B.5, that is only included in PO 2.2 and PO 2.3, requires the establishment of Single Points of Contact (SPC) for PRM at multimodal hubs, which leads to significantly higher adjustment costs (both one-off and recurrent) under these two options. The one-off adjustment costs are estimated at EUR 4.2 million, while the recurrent adjustment costs at EUR 21.2 million in 2025, and around EUR 17 million in 2030 and 2050. Expressed as present value over 2025-2050, total adjustment costs due to PM B.5 are estimated at EUR 316.5 million relative to the baseline. The costs are associated to additional personnel needed to implement the SPC devoted to arranging the assistance of passengers with disabilities or reduced mobility (PRMs), and the establishment of a central point which connects the already existing request procedures for passenger assistance in each mode. There would be no additional costs under this measure related to the actual provision of assistance to PRM, as the SPC would act as a central communication point between PRMs requesting assistance, on the one hand, and the existing PRM assistance mechanisms of terminal operator(s) and carriers, on the other hand.

These SPCs are assumed to be operated by one main terminal manager (airport, station, port or bus terminal manager) operating at a multimodal passenger hub, who would have to cooperate with other carriers and other terminal managers (if several of the latter are active at a given hub). It is assumed that all costs are borne by the main terminal manager, and that the amount of the costs would not vary depending on the nature of the terminal manager (i.e. regardless, of whether they are an airport, station, port or bus terminal manager). Individual arrangements might be put in place for specific Single Points of Contacts where carriers might also take up part of the costs, but this would depend on a case-by-case basis. For this reason, it is not possible to estimate the costs for carriers. In addition, it should be noted that none of the terminal operators at multimodal hubs fall in the category of SMEs. Thus, none of the adjustment costs due to PM B.5 are borne by SMEs.

Thus, the total adjustment costs for all terminal operators, expressed as present value over 2025-2050, are estimated at EUR 1.1 million for PO 2.1 and EUR 317.6 million for PO 2.2 and PO 2.3 (see Table 10).

Options related to intermediaries (problem area 3). No impacts are expected for terminal operators for the policy options addressing problem area 3.

Table 9: Recurrent and one-off costs for terminal operators for policy options under problem area 1, expressed as present value over 2025-2050 relative to the baseline, in million EUR (2021 prices)

Source: PWC, TIS and Steer (2023), Impact assessment support study

Table 10: Recurrent and one-off costs for terminal operators for policy options under problem area 2, expressed as present value over 2025-2050 relative to the baseline, in million EUR (2021 prices)

Source: PWC, TIS and Steer (2023), Impact assessment support study

6.1.2.3Benefits for terminal operators

Options related to enforcement (problem area 1). PO 1.1 and PO 1.2 offer indirect benefits for terminal operators, similar to those described for carriers. The benefits for terminal operators are expected to be higher in PO 1.2 relative to PO 1.1, due to PM A.5 which is only included in PO 1.2.

Option related to enforcement (problem area 2). In addition, PO 2.2 and PO 2.3 are expected to result in indirect benefits for terminal operators operating at multimodal passenger hubs. In particular, the establishment of Single Points of Contact (PM B.5) would lead to improved communication channels, not only with other carriers but also with other terminal operators where several of them are operating at the same hub.

6.1.3Impacts on intermediaries

6.1.3.1Administrative costs for intermediaries

There are no impacts on administrative costs expected for intermediaries for policy options addressing problem area 1.

Options related to multimodal passenger rights (problem area 2). Policy options PO2.2 and PO2.3 are expected to lead to small recurrent administrative costs for intermediaries due to PM B.2, estimated at EUR 1,401 per year for the 6 intermediaries affected (EUR 233 per intermediary). Expressed as present value over 2025-2050, they amount to EUR 25,789 relative to the baseline.

Options related to intermediaries (problem area 3). Under all POs 3.1, 3.2, and 3.3 intermediaries would incur one-off administrative costs of EUR 57.4 million for informing passengers about the reimbursement process (equivalent to two working days of a worker per intermediary). Those intermediaries that currently take longer than 7 days to reimburse to their customers might have to invest in processes to expedite this. Under the CPC action against three major online intermediaries, these three agreed to transfer refunds received from airlines within seven days, which supposes that this measure will not be too difficult for intermediaries to meet 139 . In addition, the new PM C4 will facilitate the task of intermediaries, as it expected that carriers will have to link each reimbursement payment to the original booking number, and transfer the amount to the intermediary in one single transaction to the original method of payment (something which was, according to intermediaries, often missing in the past and made their work more difficult).

Under PO 3.2, a carrier with an exclusive direct distribution model can decide not to involve intermediaries for the reimbursement. Intermediaries which so far, despite the carrier’s prohibition, processed the reimbursement and offered this as part of their business model, will no longer be able to do so. However, we consider that in this case, the intermediary will recover this loss through a minor increase of another fee charged to the passenger, and that this will not impact the intermediary’s business model.

6.1.3.2Administrative cost savings for intermediaries

No administrative costs savings are expected for intermediaries for policy options addressing problem area 1 and 2.

Options related to intermediaries (problem area 3). Under PO 3.1, intermediaries would save administrative costs of EUR 37.8 million in 2025, EUR 41.3 million in 2030 and 53.3 million in 2050, because they would no longer be handling passengers’ reimbursement requests. Under PO 3.3, assuming that intermediaries would no longer process 20% of reimbursement requests which they would have handled under the baseline, cost savings for intermediaries are estimated at EUR 7.6 million in 2025, EUR 8.3 million in 2030 and EUR 10.7 million in 2050 140 . Intermediaries may lose the revenues they may have through handling fees for reimbursement requests. However, given that these fees are likely to represent a small increase in the average ticket fare in percentage terms, this is unlikely to have a considerable negative effect on the business model of intermediary ticket vendors 141 . Expressed as present value over 2025-2050, administrative cost savings under PO 3.1 amount to EUR 828.5 million and under PO 3.3 to EUR 165.7 million.

6.1.3.3Adjustment costs for intermediaries

Options related to enforcement (problem area 1). Under both PO 1.1 and PO 1.2 (see Table 11), intermediaries incur one-off adjustment costs of EUR 14.4 million associated to the obligation to accept standardised claim forms for reimbursement and compensation and the need to adjust their information systems (PM A.3) 142 .

Options related to multimodal passenger rights (problem area 2). Adjustment costs for intermediaries relative to the baseline are driven by: (i) two measures common to all three policy options (i.e. PM B.1 requiring intermediaries to provide guidance to passengers on minimum connecting times and other useful information when switching between modes of transport, and PM B.7 requiring intermediaries to establish an online and offline complaint-handling mechanism); (ii) a policy measure common to PO 2.2 and PO 2.3 which obliges intermediaries to put in place a system for providing real-time information to passengers (PM B.2); (iii) a policy measure common to PO 2.1 and PO 2.2 (PM B.3a) concerning a set of rights that apply to single contracts of carriage (category A), and which is included in an enhanced version (i.e. PM B.3b gives passengers having such contract a “right to self re-routing”) in PO 2.3; and (iv) a policy measure included in PO 2.2 ensuring information to passengers holding separate tickets for a multimodal journey acquired from an intermediary, failing which intermediaries have to ensure essential rights towards the passenger (category B) (PM B.4a), which is included in PO 3.2 in its enhanced version (PM B.4b). Expressed as present value over 2025-2050, intermediary ticket vendors are expected to incur total adjustment costs of EUR 0.4 million in PO 2.1, EUR 3.4 million in PO 2.2 and EUR 3.6 million in PO 2.3 (see Table 12). Out of these, EUR 0.1 million in PO 2.1, EUR 3.2 million in PO 2.2 and EUR 3.3 million in PO 2.3 are one-off costs.

No adjustment costs are expected for intermediaries for policy options addressing problem area 3.

Table 11: Recurrent and one-off costs for intermediaries for policy options under problem area 1, expressed as present value over 2025-2050 relative to the baseline, in million EUR (2021 prices)

Source: PWC, TIS and Steer (2023), Impact assessment support study

Table 12: Recurrent and one-off costs for intermediaries for policy options under problem area 2, expressed as present value over 2025-2050 relative to the baseline, in million EUR (2021 prices)

Source: PWC, TIS and Steer (2023), Impact assessment support study

Table 13: Recurrent and one-off costs for intermediaries for policy options under problem area 3, expressed as present value over 2025-2050 relative to the baseline, in million EUR (2021 prices)

Source: PWC, TIS and Steer (2023), Impact assessment support study; Note: negative values represent net costs.

6.1.3.4Benefits for intermediaries

Options related to enforcement (problem area 1). PO 1.1 and PO 1.2 offer indirect benefits for intermediaries, similar to those for carriers, and terminal operators. PM A.1 will help NEBs to deal with non-compliance faster when they can request documents needed within clear deadlines from all involved. This leads to quicker and more efficient procedures of information sharing between NEBs and intermediaries, which in turn will require less resources from the intermediary. Having deadlines aligned across Member State NEBs, will also make the process easier for the intermediary, as the process does not differ from NEB to NEB. With the introduction of an EU-wide standardised form for reimbursement and compensation requests due to PM A.4, intermediaries can – while not being obliged to – use this form as a model to design their IT systems for handling such requests. Intermediaries will then have the necessary information for claim handling faster and the cooperation with the NEBs and ADR bodies regarding such requests will also have the potential to become more efficient and require less resources for the intermediary.

The benefits are expected to be higher in PO 1.2 relative to PO 1.1, because PM A.4 further expands the competitive advantage of well performing intermediaries. Published risk assessments, which NEBs will base their monitoring on, will ensure that intermediaries know what parameters they are judged on, which will enable intermediaries to more effectively comply and thus prevent having to allocate resources to additional monitoring by NEBs.

Options related to multimodal passenger rights (problem area 2). All policy options (PO 2.1, PO 2.2 and PO 2.3) are expected to result in hassle costs savings for intermediaries due to less time spent for handling complaints (PM B.7). Under a conservative approach, the hassle costs savings for intermediaries are estimated at EUR 24 million expressed as present value over 2025-2050 relative to the baseline 143 . PO 2.2 and 2.3 offer additional indirect benefits to intermediaries (ticket vendors/tour operators). The policy measures targeted to Category B-tickets (PM B.4a and B.4b) provide for a possible exemption to liability towards the passenger in the event of a missed connection during a multimodal journey. This is conditional on the provision of information to passengers that the tickets bought from the intermediary constitute separate transport contracts.

Options related to intermediaries (problem area 3). PO 3.2 and 3.3 offer indirect benefits for intermediaries (under the procedure that includes the intermediary). If the carrier, under PO 3.2, or the citizen, under PO 3.3, so decides, the intermediary receives an official role in the reimbursement process, and rules on ‘who pays whom first’, and what happens when this is not adhered to. This facilitates the B2B relationship between airline and intermediary. If the carrier does not pay the intermediary in time, the intermediary can send the passenger to the carrier, and its role in the reimbursement procedure ends. If intermediaries voluntarily reimburse to the passenger without having received the payment from the carrier first, they have an implicit right of redress towards the carrier, due to the obligatory transaction from the carrier to them within 7 days. PO 3.1 is beneficial for those intermediaries who do not want to deal with reimbursements. Under PO 3.2 and 3.3, intermediaries can also refuse to process reimbursement requests, but will then have to pass on certain data to the passenger, at booking, which may not be in the intermediary’s interest.

6.1.4Impacts on national public authorities

6.1.4.1Administrative costs for national public authorities

Options related to enforcement (problem area 1). PO 1.2 is expected to lead to recurrent administrative costs for national public authorities, for designing and regularly updating their risk assessment (PM A.4). Under a conservative approach, 10 working days per year per national public authority are expected to be needed, resulting in administrative costs estimated at EUR 1.4 million (see Table 14), expressed as present value over 2025-2050 (EUR 76 thousand per year). No administrative costs are expected for PO 1.1.

There are no impacts on administrative costs expected for national public authorities for policy options addressing problem area 2 and 3.

6.1.4.2Adjustment costs for national public authorities

Options related to enforcement (problem area 1). In both PO 1.1 and PO 1.2 NEBs would have to inform passengers about their option to use ADR bodies to seek individual redress as well as refer them to the ADR (PM A.6). This is expected to be achieved by adding information on the ADR process and a reference to the EU ADR Database on their website. The effort required has been estimated at half a working day on one-off basis per NEB, leading to one-off adjustment costs estimated at EUR 24,439 in 2025 relative to the baseline 144 .

There are no impacts on adjustment costs expected for national public authorities for policy options addressing problem area 2 and 3.

6.1.4.3Enforcement costs for national public authorities

Options related to enforcement (problem area 1). PO 1.1 and PO 1.2 are expected to lead to enforcement costs for national public authorities. The recurrent costs for monitoring the implementation of the quality standards (PM A.2), which will consist in reviewing the reports of carriers and the information provided by terminal operators, are estimated at EUR 5.2 million expressed as present value over 2025-2050 relative to the baseline (EUR 281 thousand per year). Total enforcement costs in PO 1.1 and PO 1.2 are estimated at EUR 7.2 million over 2025-2050 relative to the baseline (EUR 392 thousand per year).

Options related to multimodal passenger rights (problem area 2). Enforcement costs are estimated overall at EUR 19.4 million for PO 2.1, expressed as present value for 2025-2050 relative to the baseline, to monitor stakeholders’ activities. The enforcement costs are higher in PO 2.2 and PO 2.3, estimated at EUR 23.3 million relative to the baseline for all national authorities. The additional costs relate to PM B.2 to monitor the real-time information to passengers on disruption, and PM B.5 to monitor the establishment of “Single Points of Contact” (SPC) for PRM (see Table 15).

Options related to intermediaries (problem area 3). The enforcement costs for national public authorities of options PO 3.1, PO 3.2 and PO 3.3 are part of the enforcement costs of PM A.5 (enforcement area).

6.1.4.4Enforcement costs savings for national public authorities

Options related to enforcement (problem area 1). Some of the policy measures would ensure that NEBs could use their limited resources more efficiently for the enforcement of passenger rights. For PO 1.1 and PO 1.2, the implementation of quality standards (PM A.2) is estimated to result in recurrent enforcement costs savings of EUR 1.5 million, expressed as present value over 2025-2050 (EUR 82 thousand per year), by reducing the need to use other, more expensive monitoring tools (e.g. inspecting or auditing a larger number of stakeholders). Additionally, the adoption and use of standardised reimbursement and complaint forms (PM A.3) is estimated to result in 5% time savings of one full time equivalent per NEB, as it will help NEBs to more easily monitor compliance with reimbursement and complaint handling obligations by the industry. The costs savings due to PM A.3 are estimated at EUR 1.5 million over 2025-2050 (EUR 82 thousand per year). In addition, raising the awareness of passengers about the possibility of submitting reimbursement and compensation claims to an ADR body (PM A.6) is expected to save costs for courts, due to the expected decrease in the number of litigations cases. The costs savings due to PM A.6 relative to the baseline, are projected at EUR 2.9 million expressed as present value over 2025-2050 (EUR 155 thousand per year).

There are no impacts on enforcement costs savings expected for national public authorities for policy options addressing problem area 2 and 3.

Table 14: Recurrent and one-off costs and costs savings for national public authorities for policy options under problem area 1, expressed as present value over 2025-2050 relative to the baseline, in million EUR (2021 prices)

Source: PWC, TIS and Steer (2023), Impact assessment support study

Table 15: Recurrent and one-off costs for national public authorities for policy options under problem area 2, expressed as present value over 2025-2050 relative to the baseline, in million EUR (2021 prices)

Source: PWC, TIS and Steer (2023), Impact assessment support study; Note: * stands for the lower bound estimate.

6.1.4.5Hassle costs savings for national public authorities

There are no hassle costs savings expected for national public authorities for policy options addressing problem area 1.

Options related to multimodal passenger rights (problem area 2). In PO 2.1, PO 2.2 and PO 2.3, NEBs would benefit of hassle costs savings for processing the complaints from passengers concerning multimodal journeys (due to PM B.8). Drawing on a study by the World Bank 145 , under a conservative approach, the hassle costs savings are estimated at EUR 71.4 million, expressed as present value over 2025-2050 relative to the baseline 146 .

Options related to intermediaries (problem area 3). During the Commission’s regular meetings with NEBs, many NEBs raised the issue of an increase in complaints by passengers due to the unclear situation of which body (carrier or intermediary) would process reimbursement requests. Whilst this administrative burden on NEBs is impossible to calculate due to lack of data, the clarity which all options would provide on this matter would alleviate the burden on NEBs in this regard.

6.1.5Impacts on consumers

Options related to enforcement (problem area 1). Both PO 1.1 and PO 1.2 will have a positive impact on consumers. The standardised reimbursement and compensation claim forms (PM A.3) will make it easier to submit effective claims to carriers, terminal operators and intermediaries, and will ease a later enforcement process, should the claim be escalated to a complaint. Passengers will benefit from reduced hassle costs because submitting claims using such forms will require much less time (i.e. the standardised form will be easy to fill in, it will be available in all EU official languages, it will allow the passenger to submit a complete file so that the transport operators will not need to go back and ask for additional documents or information and it will be accessible for persons with disabilities). Under a conservative approach, the total benefits for passengers due to PM A.3 are estimated at EUR 147 million, expressed as present value over 2025-2050 relative to the baseline 147 (see Table 16).

The implementation of service quality standards (PM A.2) will lead to benefits for consumers relative to the baseline, as they will be able to make better choices when purchasing tickets, based on more information about the respective carriers and terminal operators. The increased awareness among consumers about the option to seek reimbursement and compensation trough an ADR body (PM A.6) will likewise serve as a benefit for consumers. More passengers may seek individual redress compared to the baseline, and more passengers may also use an ADR body to resolve their claim, instead of resorting to the more costly option of a court case. The costs savings associated to PM A.6 are estimated at EUR 1.6 million, expressed as present value over 2025-2050 relative to the baseline (see Table 16). The ongoing review of the ADR Directive will further increase the attractiveness of ADR and allow consumers to benefit from it. In addition, under PO 1.2, the better information of passengers by carriers and terminal operators about rights when booking a ticket or in case of a transport disruption (PM A.5) will further help citizens to learn and understand their rights as passengers, which ultimately is a precondition to exercise and enjoy them. Although no reliable quantitative estimate is possible, PM A.5 is expected to benefit 95.9 million passengers in 2025 (including passengers from air transport, long-distance bus and coach transport, waterborne transport and rail transport), 109 million passengers in 2030 and approximately 134 million passengers in 2050.

As NEBs will have to be more transparent about their monitoring of compliance under PM A.4, this would contribute to the level playing field of passenger protection throughout the Union, as it will provide incentives for harmonized and higher enforcement standards across Member States.

Table 16: Benefits for consumers for policy options under problem area 1, expressed as present value over 2025-2050 relative to the baseline, in million EUR (2021 prices)

Source: PWC, TIS and Steer (2023), Impact assessment support study

The stakeholder consultation did not result in any evidence that measures related to enforcement would lead to an increase in the ticket prices. In addition, the experience of the past ten to twenty years, which was overall a period of traffic growth for all modes of transport, indicates that the costs of implementing the passenger rights Regulations for operators have been low and sustainable for both passengers and operators (from a few cents per maritime and bus and coach passenger to a few euros per air passenger) 148 . As the costs associated with the measures included in this impact assessment are lower than those associated to the implementation of the entire passenger rights framework, the additional cost per passenger will be lower than these amounts. For these reasons cost pass-through to passengers is estimated not to be significant – or could be absorbed largely by the carriers. For example, regarding enforcement, some potential for cost pass-through has been identified with regard to the policy measure on the EU standardised claims form and the policy measure on ADR information. However, the potential increase in ticket prices is limited to the year of implementation and the cost per passenger is estimated at EUR 0.001. As such, the potential of cost pass-through is not an issue considering the very limited additional costs per passenger.

Options related to multimodal passenger rights (problem area 2). All policy options addressing problem area 2 (PO 2.1, PO 2.2 and PO 2.3) would entail benefits for passengers planning or undertaking a journey with two or more transport modes.

In particular, the quality of a multimodal journey offered as a single contract (category A) would increase under PM B.3a (included in PO 2.1 and PO 2.2), where passengers having concluded those contracts would enjoy a level of protection comparable to passengers travelling with a single mode of transport (right to reimbursement/rerouting and care). Under PM B.3b (included in PO 2.3), there would be an additional right for passengers having a category A ticket, to conclude an alternative transport contract in the event of a missed connection. The latter measure implies that any reasonable cost borne by the passenger to re-route in the event of a missed connection, in the absence of an offer by the carrier, would have to be borne by the carrier.

The right to reimbursement/re-routing for passengers performing a multimodal journey under a category A ticket implies that passengers would avoid costs associated to re-routing in the event of a missed connection. The costs savings for reimbursement/re-routing are estimated at EUR 13.2 million for PM B3.a (in PO 2.1 and PO 2.2), expressed as present value over 2025-2050 relative to the baseline, while for PM B.3b, which includes the right to conclude an alternative transport contract, at EUR 15.7 million (in PO 2.3). Regarding the right to care, passengers may incur costs savings related to expenses on refreshments, meals, and accommodation in the event of a missed connection. The costs savings for care are estimated at EUR 6.8 million for PM B3.a (in PO 2.1 and PO 2.2), expressed as present value over 2025-2050 relative to the baseline, and at EUR 8.1 million for PM B.3b (in PO 2.3). The total costs savings for reimbursement/re-routing and care are estimated at EUR 20.1 million for PM B3.a (in PO 2.1 and PO 2.2), expressed as present value over 2025-2050 relative to the baseline, while for PM B.3b at EUR 23.8 million (in PO 2.3).

Passengers would also benefit of more transparent and comprehensive travel information in the context of multimodal journeys. Improved pre-purchase information on multimodal travel, including on the level of protection associated to particular transport ticket(s) (PM B.1), will allow passengers to make better-informed decisions about their travel options, and may influence their purchasing behaviour of multimodal solutions. Thus, passengers may use more multimodal travel, due to increased confidence and less time spent on journey travel research (such as on connecting times between transport services or the access of certain transport infrastructure). This may also indirectly result into less financially uncertain choices or decisions to use single mode transport options, when informed of the risks. Providing real-time information to passengers, thereby providing transparency on possible delays, cancellations as well as on next connections (PM B.2) may also have a positive impact on consumer trust.

In this context, it should be noted that it is not likely that extra costs for the implementation of information rights will be passed on to customers in the form of higher prices for multimodal tickets. In particular with regard to the implementation of pre-journey information to passengers on minimum connecting times and other useful information in the context of multimodal travel (PM B.1), the analysis shows that providing such information comes at a minimal cost for the undertakings concerned. Regarding the provision of real-time information on travel disruptions and next connections (PM B.2), the costs for the undertakings concerned are mitigated to a large extent by two factors. First, large airlines already provide some sort of information to passengers on disruptions, and railway undertakings are assumed to have already implemented the necessary systems to provide real-time information to passengers in line with the new Regulation on rail passenger rights. Second, SMEs are exempted from delivering real-time information, implying that only a handful of carriers in the bus and coach sector and the waterborne sector, as well as only a few ticket vendors would be affected by this measure 149 .

PRMs would also benefit of hassle costs savings in POs 2.2 and PO 2.3 thanks to the Single Points of Contact (PM B.5). Considering that PRMs make on average 2 phone calls to request assistance and that each of these calls takes on average 30 minutes, PRMs may save 30 to 60 minutes to request assistance in their multimodal journeys where they would only have to make one such call to the Single Point of Contact. Under a conservative approach (lower bound estimate), assuming 30 minutes saved to request assistance, the potential hassle cost savings for PRMs are estimated at EUR 277.3 million, expressed as present value over 2025-2050 relative to the baseline 150 (see Table 17). This should also support an increase in PRM confidence to travel, based on improved expectation of being granted adequate assistance on multimodal travels while reducing the number of requests made by the PRM for a given journey.

Hassle costs savings for PRMs are also expected due to PM B.3a (in PO 2.1 and PO 2.2) and PM B.3b (in PO 2.3). In particular, PRMs having a single contract of carriage may save 40 to 60 minutes per multimodal journey when arranging assistance. Thus, under a conservative approach (lower bound estimate), the hassle costs savings for PRMs are estimated at EUR 18.6 million in PM B.3a and PM B.3b, expressed as present value over 2025-2050 relative to the baseline 151 (see Table 17).

Moreover, PM B.7 (complaint-handling by industry stakeholders) and PM B.8 (enforcement by NEBs) would increase trust in redress mechanisms, which are key to ensuring that consumers fully benefit from the legal protections available. At the same time, hassle costs for passengers would be reduced. Under a conservative approach (lower bound estimate), assuming 15 minutes saved per complaint, total hassle costs savings are estimated at EUR 43.3 million relative to the baseline, expressed as present value over 2025-2050 152 .

Table 17: Benefits for consumers for policy options under problem area 2, expressed as present value over 2025-2050 relative to the baseline, in million EUR (2021 prices)

Source: PWC, TIS and Steer (2023), Impact assessment support study

Options related to intermediaries (problem area 3). In PO 3.1, requesting reimbursement from air carriers (due to PM C.1a) is expected to lead to additional hassle costs for consumers, given the additional information that will need to be provided before requesting their reimbursement in case of tickets bought via intermediaries. This is because airlines do not often have all the necessary information from passengers to be able to issue the reimbursement. The additional time spent per reimbursement request to air carriers, for providing the information requested by them, is estimated at 20 minutes (lower bound) to 40 minutes (upper bound) 153 . Assuming 20 additional minutes per reimbursement request, the total hassle costs due to PM C.1a in PO 3.1 are estimated at EUR 1,044.9 million, expressed as present value over 2025-2050 relative to the baseline 154 . In PO 3.2 (due to PM C.1b) the number of requests for reimbursement to carriers and intermediaries is expected to remain unchanged compared to the baseline. Therefore, no additional hassle costs for consumers are projected due to PM C.1b. In PO 3.3 (due to PM C.1c) passengers will have the choice to request reimbursement from the carrier or the intermediary in case of indirect ticket sales. Around 20% of passengers may request reimbursement from the carrier. Assuming 20 additional minutes per reimbursement request, the total hassle costs due to PM C.1c in PO 3.3 are estimated at EUR 301.8 million, expressed as present value over 2025-2050 relative to the baseline 155 (see Table 18).

Passengers are usually unaware of how the reimbursement will be processed (i.e. whether the carrier will reimburse the passengers, by using their method of payment, as is the case with a pass-through agent intermediary or when an airline prefers to handle the reimbursement claim directly, or whether the intermediary will reimburse them), by when the Merchant of Record intermediary will reimburse them, and whether the intermediary charges a fee for this 156 . Under all options, passengers would benefit from hassle cost savings because of the clarity on the reimbursement procedure provided by PM C.1a, C.1b and C.1c. Passengers would no longer be sent around and could be sure that the body they would approach for their refund, in line with the information provided, would indeed process the refund. Under a conservative approach, it is assumed that passengers may, on average, benefit from time savings of at least 15 minutes when looking for information on the reimbursement conditions and process. Thus, the hassle costs savings due to PM C.1a (in PO 3.1), PM C.1b (in PO 3.2) and PM C.1c (in PO 3.3) are estimated at EUR 1,679.1 million, expressed as present value over 2025-2050 relative to the baseline 157 (see Table 18).

Under the intermediary procedure, which is assumed to be most used in PO 3.2 158 , and a bit less under PO 3.3, the passenger will benefit from a guaranteed reimbursement deadline of 7 days for the (Merchant of Record) intermediary’s transaction to the passenger. The intermediary’s reimbursement deadline has so far been subject to the terms and conditions of the intermediary 159 and often exceeds 7 days, or is not clear at all. According to the terms and conditions of a number of (Merchant of Record) intermediaries (see Annex 12), intermediaries may take between 7 to 60 days to reimburse passengers under the baseline. Passengers booking with intermediaries that take longer than 7 days to reimburse to the passenger would benefit from additional time savings. Furthermore, (Merchant of Record) intermediaries often do not inform their customers at all about the maximum time it takes them to reimburse to the customer, once the intermediary has received the payment from the airline. PM C.3 will provide clarity on this, and save the passenger the hassle of contacting the intermediary (possibly multiple times) to check when the reimbursement payment will be made. Under PO 3.2, where the intermediary is involved, passengers benefit by not having to pay fees to the intermediary for the reimbursement 160 .

All options enable the passengers to approach the carrier for the reimbursement, with the data needed, if necessary. In PO 3.1 this is by default, while in PO 3.2 and PO 3.3 this is in the case where the intermediary has not paid the passenger within 14 days, as a ”plan B” for the passenger. This policy measure is important because many intermediaries generate their own ticket identification numbers or booking references, with the consequence that the passenger cannot provide the carrier with its own booking reference when requesting the reimbursement directly from it 161 . The benefit to passengers from this measure is a gain in time and less hassle from calls to the airline’s call centre. It is assumed that passengers booking flights via intermediaries with airlines with an indirect booking model will gain at least 10 minutes due to this measure in PO 3.1 and PO 3.3 in their reimbursement procedure. Thus, the hassle costs savings for consumers, expressed as present value over 2025-2050 relative to the baseline, are estimated at EUR 522.5 million in PO 3.1 162 and EUR 104.5 million in PO 3.3 163 . The “plan B” under the intermediary procedure in PO 3.2 and 3.3 (PM C.4) lengthens the intermediary procedure by a maximum of 7 days. However, the main passenger and consumer associations consider that such a “plan B” is necessary, in case there is a problem with the intermediary.

In terms of general length of the reimbursement procedure, PO 3.1 is the shortest: 7 days. PO 3.2 and 3.3 (where the intermediary is chosen) would normally take a maximum of 14 days, but would save the passengers considerable hassle.

Whilst it might appear at first sight that PO 3.3 is most beneficial for the passenger because the passenger can choose the procedure, this may not be so in reality. The passenger cannot be expected to know and to understand what kind of costs and benefits each procedure implies, such as the additional hassle inherent in the carrier-only procedure, as opposed to the one via the intermediary. The passenger is usually the least knowledgeable of the market and will not be aware of how well the individual intermediaries comply with the rules. It will in the end be better for the passenger if the airline decides this, based on its market knowledge, as it is in the airline’s interest to only cooperate with reliable intermediaries 164 .

In addition, under the carrier-only procedure (PO 3.1 fully, PO 3.2 and PO 3.3 partly) the carrier has no particular incentive, as it exists under the intermediary procedure of PO 3.2 and PO 3.3, to respect its payment deadline 165 , which might lead to delayed reimbursements to the passenger in practice. The respect of the payment deadline is an issue because on average, between 20-30% of passengers booking via Merchant of Record intermediaries are currently not paid within 7 days 166 (based on pre-pandemic data), affecting between 18.5 million and 27.7 million passengers in 2019. Under PO 3.2, the intermediaries are also incentivised to respect their payment deadline, as otherwise, the carriers may no longer decide to involve them in the reimbursement process, but carry it out by themselves (which is not in the interest of the intermediaries).

The main passenger and consumer associations are not advocating PO 3.1 as the preferred option, which suggests that the slightly more lengthy procedure via the intermediary in PO 3.2 and 3.3 is not a key factor overall. Intermediaries have reported as part of the stakeholder consultation that carriers which do not want to cooperate with them are obstructing, delaying and refusing to provide refunds via the intermediaries - a situation which can be expected to also lengthen the time that the reimbursement arrives with the passenger. Leaving the choice to the airline under PO 3.2 (as opposed to the passenger under PO 3.3) on how to process the reimbursement will best ensure that the passenger receives the reimbursement payment in time, and with the least hassle.

Table 18: Hassle costs and costs savings for consumers for policy options under problem area 3, expressed as present value over 2025-2050 relative to the baseline, in million EUR (2021 prices)

Source: PWC, TIS and Steer (2023), Impact assessment support study

It should also be noted that it is not likely that extra costs for the implementation of information rights will be passed on to customers in the form of higher prices for tickets. Regarding reimbursement of air tickets when intermediaries are involved, the one-off costs for airlines for informing the passenger about the reimbursement process are expected to lead to costs of EUR 0.01, and of EUR 0.07 per passenger booking via intermediaries. As such, the potential of cost pass-through is not an issue considering the very limited additional costs per passenger.

6.1.6Impacts on SMEs

A significant part of carriers and intermediaries are SMEs. Therefore, the initiative is considered relevant for SMEs and the SME test has been performed (see Annex 8).

While many carriers in the air and rail transport, and terminal operators, are medium and some even large companies, bus and coach carriers, waterborne carriers as well as intermediaries are often SMEs. Around 85% 167 (3,211 out of 3,778) of bus and coach carriers and 99% 168 (518 out of 523) of waterborne carriers are SMEs. Regarding intermediaries, ECTAA estimates that there are 123,000 travel agents and tour operators across EU, of which 95% (116,850) are SMEs 169 .

Detailed tables on the impacts by policy option, policy measure and stakeholder group are provided in Annex 8. An overview of costs and costs savings by policy option under each problem area are also provided in Tables 19-24 below.

Options related to enforcement (problem area 1). Both PO 1.1 and PO 1.2 lead to an increase of the administrative and adjustment costs for SME carriers and of the adjustment costs for SME intermediaries, compared to the baseline. Administrative costs stem from policy measure PM A.2, while adjustment costs stem from policy measures PM A.2 and PM A.3 in PO 1.1 and PO 1.2. In addition, PM A.5 also results in adjustment costs for PO 1.2.

For SME carriers, PO 1.2 shows higher costs than PO 1.1 in 2025 (EUR 17.8 million compared to EUR 13.5 million respectively), while in 2030 and 2050 the costs are similar for both options (EUR 4.4 million). This is because of PM A.5 (included only in PO 1.2) that requires carriers to better inform passengers about their rights, in particular when booking a journey or when a transport disruption occurs. In terms of present value over 2025-2050, total costs for carriers are estimated at EUR 89.3 million in PO 1.1 and EUR 93.6 million in PO 1.2. The intermediary ticket vendors and tour operators bear one-off adjustment costs of EUR 13.6 million in 2025 (see Table 19-20).

The total costs per SME carrier (for bus and coach operators and waterborne transport operators) are estimated at EUR 3,618 in 2025 and EUR 1,167 per year from 2026 onwards, while for SME intermediaries at EUR 117 in 2025. Considering the annual average turnover per SME (EUR 2.1 million per bus and coach operator and EUR 13.7 million per waterborne transport operator 170 ), the total cost per bus and coach operator is estimated at less than 0.2% of the turnover in 2025 (including also one-off costs) and less than 0.1% of the turnover post-2025, while the cost per waterborne transport operator is estimated at less than 0.1% of the turnover for all periods.

Table 19: Total recurrent and one-off costs for SMEs in the POs addressing problem area 1, expressed as present value over 2025-2050 relative to the baseline scenario, in million EUR (2021 prices)

Source: PWC, TIS and Steer (2023), Impact assessment support study

Table 20: Total recurrent and one-off costs for SMEs in the POs addressing problem area 1, in 2025, 2030 and 2050 relative to the baseline scenario, in million EUR (2021 prices)

Source: PWC, TIS and Steer (2023), Impact assessment support study

Options related to multimodal passenger rights (problem area 2). All three policy options PO 2.1, PO 2.2 and PO 2.3 result in an increase in adjustment costs for carriers and intermediaries SMEs, compared to the baseline. These costs stem from policy measures PM B.1 and PM B.7 which are common to all policy options, and from PM B.3 (a or b) and PM B.4 (a or b). PM B.1 and PM B.7 are expected to have an impact on 270 SMEs, PM B.3a and PM B.3b on 128 SMEs, and PM B.4a and PM B.4b on 263 SMEs.

Carriers bear the largest share of the total costs. PO 2.3 shows the highest increase in costs for carriers relative to the baseline (EUR 11.25 million, of which EUR 11.23 million for bus and coach operators and EUR 0.02 million for waterborne transport operators), followed by PO 2.2 (EUR 10.26 million, of which EUR 10.24 million for bus and coach operators and EUR 0.02 million for waterborne transport operators) and PO 2.1 (EUR 10.2 million, of which EUR 10.18 million for bus and coach operators and EUR 0.02 million for waterborne transport operators), expressed as present value over 2025-2050. The difference is due to PM B.3b included in PO 2.3, as opposed to PM B.3a included in PO 2.1 and PO 2.2. The reason is that under PM B.3b passengers have a right to conclude alternatives contracts where a carrier does not make provision for the continuation of the journey, in addition to the more limited rights foreseen by PM B.3a. For intermediaries, PO 2.3 is also the most costly option relative to the baseline (EUR 0.52 million), followed closely by PO 2.2 (EUR 0.36 million) and PO 2.1 (EUR 0.31 million), expressed as present value over 2025-2050.

At the same time, SMEs would benefit of significant hassle costs savings that outweigh the costs. Hassle costs savings for carriers are estimated at EUR 29.9 million and for intermediaries at EUR 22.8 million in PO 2.1, PO 2.2 and PO 2.3. Thus, all policy options result in net benefits for SME carriers (EUR 19.7 million in PO 2.1, EUR 19.6 million in PO 2.2 and EUR 18.6 million in PO 2.3) and intermediaries (around EUR 22.5 million in PO 2.1 and PO 2.2 and EUR 22.3 million in PO 2.3), expressed as present value over 2025-2050 relative to the baseline.

Table 21: Total costs and costs savings for SMEs in the POs addressing problem area 2, expressed as present value over 2025-2050 relative to the baseline scenario, in million EUR (2021 prices)

Source: PWC, TIS and Steer (2023), Impact assessment support study; Note: * stands for lower bound estimates.

Table 22: Total costs and costs savings for SMEs in the POs addressing problem area 2, in 2025, 2030 and 2050 relative to the baseline scenario, in million EUR (2021 prices)

Source: PWC, TIS and Steer (2023), Impact assessment support study; Note: * stands for lower bound estimates.

Options related to intermediaries (problem area 3). SME intermediaries consist mostly of brick and mortar travel agents. All three policy options lead to identical one-off administrative costs for the 116,850 SME intermediary ticket vendors in 2025, amounting to EUR 54.6 million. These costs are due to PM C.1 (a, b or c) which obliges them to inform passengers on the reimbursement process. Per SME intermediary, the administrative costs are estimated to be limited, at EUR 467 in 2025.

These costs are largely overcompensated by administrative costs savings in PO 3.3 (EUR 7.2 million in 2025, EUR 7.8 million in 2030 and EUR 10.1 million in 2050) and especially in PO 3.1 (EUR 36 million in 2025, EUR 39.2 million in 2030 and EUR 50.7 million in 2050). Expressed as present value over 2025-2050, the total cost savings relative to the baseline are estimated at EUR 157.4 million in PO 3.3 and EUR 787 million in PO 3.1. The administrative cost savings are explained by the fact that intermediaries would no longer handle reimbursement requests to the same extent (PM C1.a under PO 3.1 and PM C1.c under PO 3.3).

Table 23: Total costs and costs savings for SMEs in the POs addressing problem area 3, expressed as present value over 2025-2050 relative to the baseline scenario, in million EUR (2021 prices)

Source: PWC, TIS and Steer (2023), Impact assessment support study; Note: negative values stand for net costs.

Table 24: Total costs and costs savings for SMEs in the POs addressing problem area 3, in 2025, 2030 and 2050 relative to the baseline scenario, in million EUR (2021 prices)

Source: PWC, TIS and Steer (2023), Impact assessment support study; Note: negative values stand for net costs.

6.1.7Impacts on the functioning of the internal market and on competition

All policy options are expected to have a positive impact on the functioning of the internal market, by removing unnecessary barriers for passengers and for actors in the passenger transport market. At the same time they ensure a level playing field for all stakeholders.

Options related to enforcement (problem area 1). For PO 1.1 and PO 1.2 carriers and terminal operators will benefit from a bigger focus on enforcement. The obligation to publish reports on results of service quality standards for carriers and terminal operators will positively affect the competitiveness of compliant carriers and operators, as ‘compliance’ will become more transparent to passengers, and a factor from which the industry can get a competitive edge. Additionally, especially PO 1.2 will further the level playing field between industry stakeholders inside the Union, as NEBs will publish risk assessments, ensuring a more harmonised approach for enforcement across Member States. In turn, efforts to harmonise monitoring and enforcement efforts, will facilitate a better-functioning internal market, as consumers will be more willing to purchase services throughout the Union.

Options related to multimodal passenger rights (problem area 2). PO 2.1, and in particular PO 2.2 and PO 2.3 are expected to have a positive impact on the functioning of the internal market by facilitating the free movement of people, where the introduction of multimodal passenger rights will encourage more long-distance travels which often entail a cross-border element, especially where they book a single contract of carriage (category A). This positive impact on the functioning of the internal market will also manifest itself across all options with the creation of a level playing field across the Union for carriers and intermediaries with regard to the provision of multimodal passenger rights. These policy options, and in particular PO 2.2 and PO 2.3, will also increase the competitiveness of the market by improving the quality of passenger transport services for consumers, including for PRM with the introduction of a free right to assistance under single contracts of carriage (category A) and the establishment of Single Points of Contact at multimodal hubs. Especially under PO 2.2 and PO 2.3, this competitiveness factor is reinforced by an increased level of information to passengers regarding the characteristics of the passenger transport service (in particular for separate tickets which are bundled and sold by intermediaries – category B), thereby allowing them to make a more informed decision before booking a multimodal journey.

Options related to intermediaries (problem area 3). Many (online) air travel intermediaries, as well as carriers by definition, operate across borders within the EU. Under PO 3.2 and PO 3.3, for the intermediary procedure, intermediaries will benefit from an official role when it comes to reimbursements, which will strengthen their competitive position. They will most likely invest in digital processes in order to be able to reimburse passengers quickly and to comply with their new 7-day deadline. Under PO 3.2, carriers will be encouraged to (further) invest in the reimbursement procedure which best suits them, leading to efficiency gains. Under PO 3.2 and PO 3.3, for the intermediary procedure, air passengers will benefit from a harmonised intermediaries’ reimbursement period, which will contribute to their confidence in the air travel market. This provision would also create a level-playing field for air travel intermediaries involved in the reimbursement process in the EU. The information obligation on carriers and intermediaries under all options will help consumers to shop effectively, including across borders.

6.1.8Impacts on digitalisation (including Digital by Default)

Options related to enforcement (problem area 1). Under both PO 1.1 and PO 1.2 there is a broad understanding of the need to use digital products and services. The proposed measures are shaped based on the assumption of a strong and agile digital framework, provided by PM A.5 on the improved information of passengers about their rights when booking a journey or when a transport disruption occurs and PM A.3 on the broad acceptance of a standardised claim form. Considerable economies of scale in the medium term can also be expected by data mining and other artificial intelligence tools to analyse the reports of carriers and terminal operators 171 .

Options related to multimodal passenger rights (problem area 2). PO 2.1, PO 2.2 and PO 2.3 recognise the important place that digital products and solutions take in today’s society. Many measures are based on the unstated assumption of a strong digital framework to facilitate the implementation. This is the case of PM B.2 (on real-time information), of PM B.3b and PM B.4b (on care and assistance, rerouting, etc.), of PM B.7 (on online complaint handling) and of PM B.5 (on Single Points of Contact).

Options related to intermediaries (problem area 3). Under PO 3.2 and PO 3.3, intermediaries will most likely be incentivised to invest in digital solutions in order to process the reimbursement payments to their customers in a faster way. Many EU-based intermediaries are SMEs and would most likely adapt to the changes under consideration through increased reliance on digital solutions. Under PO 3.1, air carriers may decide to use possibly upcoming e-ID solutions 172 to replace their existing authentication and identification systems, such as biometric checks of passengers.

6.1.9Territorial impacts

The problems that this initiative aims to address and consequently the impacts of the policy options assessed are generally not concentrated in specific Member States, regions or transport hubs. No stakeholder raised this issue during the consultation process. For the problem areas on multimodal travel and reimbursement of air tickets booked via intermediaries, the even geographical distribution of impacts across the EU is straightforward, with the notable exception of the establishment of multimodal hubs. For the problem area of enforcement there are different national approaches of NEBs but the measures envisaged apply equally to all NEBs.

All three options related to multimodal passenger rights (problem area 2) are expected to have positive effects on connectivity. This is because an increase in the protection of passengers on multimodal journeys will entice more passengers to use more than a single mode of transport for their journey. Therefore, they can maximise the convenience and benefits they derive from being able to use the most adapted transport offer to their needs, time and budget requirements. This is especially important for users living in remote areas (notably rural areas), or in segregated areas or in less developed regions as increased connectivity in their case affects all areas of life (employment opportunities, education and health care options, etc.).

PM B.5 and PM B.6 (included in both PO 2.2 and PO 2.3) provide that terminal managers and carriers operating via multimodal passenger hubs have to cooperate to set up a Single Point of Contact. The methodology laid down in the proposal for the revision of the TEN-T Regulation provides that at least one multimodal passenger hub has to be established for the 424 urban nodes of the TEN-T. According to the methodology, all cities with a population over 100,000 inhabitants, as well NUTS2 capitals where there is no city of at least 100,000 inhabitants are TEN-T urban nodes. This leads to a total of 424 multimodal passenger hubs. The geographical distribution is also illustrated in Figure 7. This map demonstrates that the presence of multimodal hubs, which correspond to these urban nodes, reflects the actual territorial distribution of the population – and hence potential passengers – as well as travelling patterns within the EU.

Figure 7: Geographical distribution of the TEN-T urban nodes

6.2Social impacts

PO 1.1 and PO 1.2 leads to a limited impact to employment, compared to the baseline. The proposed measures do not pose a risk of displacing less educated staff or lowering job standards. Employment impacts are also limited under PO 2.1, PO 2.2 and PO 2.3, as the measures included do not require changes in competencies, the type of staff or type of job protection with regards to the services to be delivered. A slight increase in employment could be expected if the measures are correctly implemented. Employment impacts under PO 3.1, 3.2 and 3.3 are expected to be limited as well, as most changes are linked to increased use of technology by carriers and intermediaries.

Improved rights associated to multimodal travel and increased information on those rights (PO 2.1, PO 2.2 and PO 2.3) will provide an additional incentive for youth to use multimodal journeys, especially where those travels are associated with a lower cost and a comparatively lower environmental impact. As regards the elderly, who presumably are digitally less literate, it should be noted that the information to be provided by carriers, ticket vendors, tour operators and terminal operators under PM B.1 (on connecting times and other useful information when switching between modes), included in PO 2.1, PO 2.2 and PO 2.3, should be delivered in both paper and electronic format. This reflects the current requirement in the context of Regulation (EU) 2021/782 on rail passengers’ rights and obligations.

6.3Impacts on fundamental rights

Article 38 of the Charter of Fundamental Rights of the European Union (the Charter) stipulates that Union policies shall ensure a high level of consumer protection.

Both options related to enforcement (problem area 1) are expected to contribute to a high level of consumer protection, by making it easier for consumers to exercise their passenger rights, by introducing standardised forms for reimbursement and compensation claims and making them aware of the possibility to use ADR bodies to settle their disputes with transport operators. Additionally, the options introduce the obligation for industry operators to provide information to NEBs upon request, as well as authorising the Commission to request NEBs to investigate issues, both of which strengthen the enforcement of passenger rights at Union and Member States level.

All three options related to multimodal passenger rights (problem area 2) are expected to contribute by granting a higher level of protection to passengers undertaking a journey combining at least two modes of transport. In particular, passengers who have concluded a single contract of carriage will enjoy a level of protection similar to the one enjoyed by passengers travelling by a single mode (reimbursement/re-routing, care). In addition, passengers would be better informed, both on their rights before booking (under all policy options) as well as in real-time on any possible travel disruptions occurring during the journey (PO 2.2 and PO 2.3). Moreover, a high level of consumer protection would be further enabled by redress mechanisms, both at the level of operators and national authorities (all options)

All three options related to intermediaries (problem area 3) are expected to contribute to a high level of consumer protection. PO 3.1, 3.2 and 3.3 foresee a high level of consumer protection, because the passenger who booked via an intermediary will always be able to request the reimbursement from the carrier (as a default option under PO 3.1 and as a last resort in the intermediary procedure under PO 3.2 and 3.3). Intermediary and carrier are obliged, under all options, to inform the consumer. The enforcement of the reimbursement procedure will be strengthened through PM A.4.

Furthermore, it follows from Article 21(1) of the Charter that any discrimination based on grounds of disability shall be prohibited, while Article 26 of the Charter states that the Union recognises and respects the right of persons with disabilities to benefit from measures designed to ensure their independence, social and occupational integration and participation in the life of the community.

Both options related to enforcement (problem area 1) introduce standardised complaint and reimbursement forms that would be fully accessible for persons with disabilities and reduced mobility.

All three options related to multimodal passenger rights (problem area 2) grant a right to non-discrimination and a right to free assistance with regard to single contracts of carriage for a multimodal journey, and furthermore in PO 2.3 also in cases when passengers bought separate tickets from a ticket vendor. In addition, industry actors would have to provide information to passengers on the accessibility of transport infrastructure (all policy options). Moreover, PO 2.1 and PO 2.2 foresee the establishment of Single Points of Contact at multimodal hubs to cater for the assistance of PRM travelling between modes.

All three options related to intermediaries (problem area 3) are expected to contribute to support PRM, because all information and procedures to be provided to passengers have to be offered in an accessible way.

6.4Environmental impacts

All policy options considered are expected to have some positive environmental impacts compared to the baseline, mainly on climate and air quality, although it is not possible to assess the impact quantitatively. As all policy options will enhance passenger rights, they will make mobility with collective transport solutions more attractive and may contribute to people choosing to use less their individual cars. This is expected to have a positive impact in terms of reducing CO2 and other pollutant emissions per passenger, as well as on congestion. In addition, all policy options will result in increased confidence of passengers in enforcement of passenger rights, including when travelling multimodal or when buying air tickets via an intermediary, and can therefore support the shift towards more sustainable transport choices by consumers on a given journey, in particular where this is combined with both an increased ability for passengers to find, compare, and book tickets across modes.

All policy options are consistent with the environmental objectives of the European Green Deal and the European Climate Law 173 . All policy options contribute towards Sustainable Development Goal 13 (Take urgent action to combat climate change and its impacts). No significant harm is expected on the environment in any of the policy options.

7How do the options compare? 

7.1Effectiveness

The assessment of effectiveness looks at the extent to which the general and specific objectives (SO) of the intervention, as previously described, are met. Table 25 provides the link between policy objectives and assessment criteria.

Table 25: Link between objectives and assessment criteria

All options contribute to the general objectives by contributing to the proper functioning of the internal market via measures on effective and efficient enforcement and complaint handling as well as ensuring a high level of consumer protection for passengers when travelling within one mode or when switching modes during their journey by addressing problems detected with reimbursements through intermediaries and the new multimodal market, which is currently not covered by any rights. 

Concerning SO1, both PO 1.1 and PO 1.2 are expected to further effectiveness and efficiency of enforcement across all Member States. Both options will facilitate increased efficiency in the NEBs enforcement efforts as it exists today, and expand upon it, by enabling the Commission to require NEBs to investigate specific suspected breaches of passenger rights. This helps to ensure effective enforcement across all Member States. Both options also introduce new reporting obligations for the industry, which will provide vital information for NEBs. The need for NEBs to have a clear overview on what is happening on the ground has been evidenced already before the COVID-19 pandemic but became most apparent during and after the COVID-19 pandemic, as also highlighted by the 2021 ECA report.

PO 1.2 also introduces the outlining and publishing of risk assessments by NEBs. The publishing of risk assessments will facilitate cross-border co-operation between NEBs, in the sense that NEBs will be able to gather insight, in a more efficient way, on monitoring practises from other Member States. This takes sight on SO1 in two ways. Firstly, it incentivises better enforcement efforts among all NEBs, as the methodology behind their monitoring will be publicised, enabling comparison between their targeted and actual monitoring efforts as well as comparisons between NEBs across Member States. Secondly, the publication of risk assessments from well performing and active NEBs, will serve as valuable material and insight for less active NEBs, to bolster their own enforcement efforts, effectively creating a higher standard for passenger rights enforcement across Member States. While not quantifiable, an improvement in the standard of enforcement across Member States, will also encourage passengers to choose the most virtuous operators for compliance against passenger rights. This will also level the playing field for industry as well as ensure more equal protection of passengers across the Union. The option introduces the obligation for carriers and terminal operators to better inform passengers about their rights, notably when booking a ticket or in case of a transport disruption, which will also further the effectiveness and efficiency of enforcement, as passengers will become knowledgeable about their rights and when and how to make claims and complaints. As such, PO 1.2 is much more effective in addressing SO1 than PO 1.1.

Concerning SO2, both PO 1.1 and PO 1.2 will further ensure effective complaint handling for passengers by obliging carriers, ticket vendors and tour operators to accept an EU-wide standardised form for requesting reimbursements and compensations (which will be fully accessible for persons with disabilities) and by informing passengers about the possibility to address themselves to ADRs. PO 1.2 goes further than PO 1.1, as it also introduces the obligation for carriers and terminal operators to better inform passengers about their rights, notably when booking a ticket or in case of a transport disruption including how to complain. The more knowledgeable passengers are on their rights, the more passengers will succeed in making informed complaints, with sufficient information and documentation, which in turn will facilitate effective complaint handling. As such PO 1.2 is also much more effective in addressing SO2 than PO 1.1.

Concerning SO3, while each of the policy options PO 2.1, PO 2.2 and PO 2.3 would see the improvement of information to all multimodal passengers prior to their journey, PO 2.2 and PO 2.3 would also imply that passengers having a category A or B ticket would receive better information during their journey with the introduction of an obligation for carriers and ticket vendors/tour operators to provide real-time information.

In addition, each of the policy options PO 2.1, PO 2.2 and PO 2.3 is expected to improve the assistance to passengers in case of a travel disruption during multimodal journeys, notably of those passengers acquiring a category A-ticket, with the introduction in PO 2.1 and PO 2.2 of a basic set of rights. These rights include a right to pre-purchase information, a right to reimbursement or re-routing, and the right to care (meals, refreshments, accommodation), which is complemented with a right to conclude an alternative contract in PO 2.3.

PO 2.3 would be the most effective in addressing SO4 for passengers with a category B-ticket due to the additional incentive for ticket vendors and tour operators to inform passengers with separate tickets compared to PO 2.2 (i.e. liability in the form of the same enhanced rights as passengers with a category A-ticket, compared to a right to reimbursement combined with a 75% penalty). PO 2.1 would not bring any particular contribution to passengers having a category B ticket.

Concerning SO4, the effects of PO 2.1 are expected to be rather limited where PRM would be informed on the accessibility of transport infrastructure where they intend to undertake a multimodal journey (PM B.1) and would receive assistance where they acquired a category A-ticket (PM B.3a). PO 2.2 and PO 2.3 are however expected to significantly contribute to increasing the assistance of all PRM performing a multimodal journey (i.e. not only those having a category A ticket) by the establishment of Single Points of Contact at multimodal hubs where PRM will be able to pre-notify their special needs only once for every segment of the journey.

Concerning SO5, all options ensure clarity on the reimbursement process through the information that carriers and intermediaries have to provide to passengers, but also the rules on the reimbursement procedure and the B2B rules under PO 3.2 and PO 3.3. PO 3.3 will be the least effective, as the passenger will have to deal with the burden and hassle of communicating to both the carrier and the intermediary. On the other hand, under PO 3.1 and PO 3.2, the procedure would be clarified upfront, prior to booking. Intermediaries (under PO 3.2 and PO 3.3) will no longer be able to foresee in their terms and conditions reimbursement periods to their customers where the maximum length of the reimbursement to the customer (after having received the payment from the carrier) is left open 174 .

7.2Efficiency

Efficiency concerns “the extent to which objectives can be achieved for a given level of resource/at least cost”.

7.2.1Assessment of efficiency for policy options under problem area 1 (Passengers do not fully benefit from their rights due to shortcomings in implementation and enforcement)

For PO 1.1, total costs and loss of revenues are estimated at EUR 130.7 million, expressed as present value over 2025-2050 relative to the baseline (see Table 26). The main part of these costs is expected to be incurred by carriers (EUR 103.8 million), of which EUR 90.4 million by bus and coach operators, EUR 12.5 million by waterborne operators and EUR 832 thousand by air carriers. Intermediaries are expected to incur costs of approximately EUR 14.4 million and terminal operators EUR 3.6 million. The loss of revenues for the claim agencies are estimated at EUR 1.7 million. For national public authorities, total costs amount to approximately EUR 7.2 million.

For PO 1.2, total costs and loss of revenues are estimated at approximately EUR 138 million, expressed as present value over 2025-2050 (of which EUR 109.1 million for carriers, EUR 14.4 million for intermediaries, EUR 4.3 million for terminal operators, EUR 1.7 million for claim agencies and EUR 8.6 million for national public authorities). As such, PO 1.2 adds EUR 7.3 million relative to PO 1.1, which is mainly attributed to NEBs, carriers and terminal operators. The additional cost for PO 1.2 are due to PM A.5 (outlining and publishing risk assessments for NEBs) and PM A.6 (on the obligation of carriers and terminal operators to better inform passengers about their rights). In terms of split by carrier PO 1.2 leads to costs of EUR 94.9 million for bus and coach operators, EUR 13.1 million for waterborne operators, EUR 1 million for air carriers and EUR 66 thousand for rail operators.

For both PO 1.1 and PO 1.2, under a conservative approach, total cost savings are estimated at approximately EUR 154.5 million, expressed as present value over 2025-2050 relative to the baseline. Of these, EUR 148.7 million represent benefits for the consumers (in particular hassle costs savings due to PM A.3) and EUR 5.9 million enforcement costs savings for national public authorities.

Both PO 1.1 and PO 1.2 result in net benefits, estimated at EUR 23.9 million and EUR 16.6 million respectively, expressed as present value over 2025-2050 relative to the baseline. PO 1.1 and PO 1.2 show similar benefits to costs ratio, estimated at 1.18 for PO 1.1 and 1.12 for PO 1.2.

Table 26: Summary of costs and benefits of policy options under the problem area 1 - expressed as present value over 2025-2050 relative to the baseline, in million EUR (2021 prices)

Source: PWC, TIS and Steer (2023), Impact assessment support study 

It should be noted that there is high uncertainty regarding the hassle costs savings estimated for the consumers. A conservative approach (lower bound estimate) has been used for the calculations above. When considering the higher bound estimate of the hassle costs savings, the net benefits of the policy options are estimated to be much higher (EUR 317.9 million in PO 1.1 and EUR 310.6 million in PO 1.2). The benefits to costs ratio is also estimated to be higher although also very similar between PO 1.1 and PO 1.2. Thus, using the higher bound estimate for the hassle costs savings does not change the ranking of the options with regard to the benefits to costs ratio.

7.2.2Assessment of efficiency for policy options under problem area 2 (Insufficient protection of passengers during multimodal journeys)

Total costs for PO 2.1 are estimated at EUR 41.5 million, expressed as present value over 2025-2050 relative to the baseline, of which the costs for industry represent EUR 22.1 million. The largest share of costs for industry is provided by adjustment costs for carriers (EUR 20.6 million), followed by adjustment costs for multimodal terminal operators (EUR 1.1 million) and for intermediaries (EUR 0.38 million). Enforcement costs for national public authorities are estimated at EUR 19.4 million in PO 2.1.

In PO 2.2, total costs are estimated to be higher than in PO 2.1, at EUR 379.8 million expressed as present value over 2025-2050 relative to the baseline. Of these, EUR 356.4 million represent costs for the industry and EUR 23.3 million enforcement costs for national public authorities. The largest share of costs for industry are represented by adjustment costs for multimodal terminal operators (EUR 317.64 million), which are mostly linked to the obligation to set up Single Points of Contact (PM B.5). Costs for carriers are estimated at EUR 35.3 million (i.e. EUR 0.1 million administrative costs and EUR 35.2 million adjustment costs), while the costs for intermediaries (mostly adjustment costs) at EUR 3.5 million.

Total costs in PO 2.3 are estimated at EUR 383.6 million (i.e. EUR 360.3 million for the industry and EUR 23.3 million for national public authorities). The costs for multimodal terminal operators are estimated to EUR 317.6 million (the same as in PO 2.2), the costs for carriers at EUR 39.1 million and those for intermediaries at EUR 3.6 million, expressed as present value over 2025-2050 relative to the baseline. The slightly higher costs for carriers and intermediaries relative to PO 2.2 are mainly due to PM B.3b, which additionally includes a right to conclude an alternative contract (compared to PM B.3a included in PO 2.2).

Total benefits, expressed as present value over 2025-2050 relative to the baseline, are estimated to be the highest in PO 2.3 (EUR 493.7 million), followed by PO 2.2 (EUR 490 million) and PO 2.1 (EUR 212.7 million). Of these, the largest share of the benefits are expected for consumers (EUR 363 million in PO 2.3, EUR 359.2 million in PO 2.2 and EUR 81.9 million in PO 2.1).

As explained in section 6.1.5, the benefits for consumers are reflected through hassle costs savings for PRMs due to PM B.3a in PO 2.1 and PO 2.2 and PM B.3b in PO 2.3 (EUR 18.6 million), due to the Single Point of Contact in PO 2.2 and PO 2.3 (EUR 277.3 million) and due to the complaint handling mechanism (EUR 43.3 million) in PO 2.1, PO 2.2 and PO 2.3. In addition, the right to reimbursement/re-routing and care for passengers performing a multimodal journey under a category A ticket implies that passengers would avoid costs associated to re-routing, refreshments, meals, and accommodation in the event of a missed connection. The costs savings for reimbursement/re-routing and care are estimated at EUR 20.1 million in PO 2.1 and PO 2.2, expressed as present value over 2025-2050 relative to the baseline, while for PM PO 2.3, which includes the right to conclude an alternative transport contract, at EUR 23.8 million.

All policy options are also expected to result in hassle costs savings for multimodal transport operators (35.3 million) and intermediaries (EUR 24 million) due to less time spent for handling complaints. NEBs would also benefit of hassle costs savings in all policy options (71.4 million) for processing the complaints from passengers concerning multimodal journeys (see Table 27). 

PO 2.1 results in the highest net benefits, estimated at EUR 171.2 million expressed as present value over 2025-2050 relative to the baseline, followed by PO 2.2 (EUR 110.2 million) and PO 2.3 (EUR 110.1 million). PO 2.1 also results in the highest benefits to costs ratio, while PO 2.2 and PO 2.3 show similar benefits to costs ratios (see Table 27). Thus, the most efficient option is PO 2.1, followed by PO 2.2 and PO 2.3.

Table 27: Summary of costs and benefits of policy options under the problem area 2 - expressed as present value over 2025-2050 relative to the baseline, in million EUR (2021 prices)

Source: PWC, TIS and Steer (2023), Impact assessment support study

It should be noted that there is high uncertainty regarding the hassle costs savings estimated for the consumers, carriers, intermediaries and national public administrations. A conservative approach (lower bound estimate) has been used for the calculations above. When considering the higher bound estimate of the hassle costs savings, the net benefits are estimated at EUR 702.6 million in PO 2.1, EUR 918.9 million in PO 2.2 and EUR 918.8 million in PO 2.3. In terms of benefits to costs ratio, the ranking of the policy options does not change.

7.2.3Assessment of efficiency for policy options under problem area 3 (Reimbursement rules are unclear when flights were booked via an intermediary)

Total costs, expressed as present value over 2025-2050 relative to the baseline, are estimated to be the highest in PO 3.1 (EUR 2,719.6 million), followed by PO 3.3 (EUR 682.7 million) and PO 3.2 (EUR 57.5 million). The largest share of these costs in PO 3.1 and PO 3.3 is represented by administrative costs for air carriers (EUR 1,617.2 million in PO 3.1 and EUR 323.5 million in PO 3.3) for processing manual reimbursements (as automatic reversal of payment is not possible), and hassle costs for consumers for requesting reimbursement from air carriers (EUR 1,044.9 million in PO 3.1 and EUR 301.8 million in PO 3.3), due to the additional information that they will need to provide before requesting their reimbursement in case of tickets bought via intermediaries. All options would lead to minor administrative costs for air carriers for the information obligation (EUR 0.07 million). Intermediaries would incur administrative costs (information to passengers) of EUR 57.4 million in all policy options. National public authorities are not expected to incur any additional cost under any option, as these are covered by PM A.5.

Overall, for the industry, the option with the lowest costs is PO 3.2 (the carrier can choose whether the passenger has to request the reimbursement from the intermediary or the carrier), followed by PO 3.3 (the passenger can choose whether to request the reimbursement from the intermediary or the carrier). PO 3.1 (all reimbursement requests carried out by the air carrier) shows the highest costs.

For the consumers, PO 3.2 contains no additional hassle costs relative to the baseline, and will only take 7 days longer than the procedure via the carrier only. In position papers submitted to the Commission, passenger and consumer associations have not advocated the carrier-only procedure under PO 3.1.

Total benefits, expressed as present value over 2025-2050 relative to the baseline, are estimated at EUR 3,030 million in PO 3.1, followed by PO 3.3 (EUR 1,949.3 million) and PO 3.2 (EUR 1,679.1 million). The largest share of the total benefits is represented by hassle costs savings for consumers. Under all options, passengers would benefit from hassle cost savings of EUR 1,679.1 million because of the clarity on the reimbursement procedure. All options also enable the passengers to approach the carrier for the reimbursement, with the data needed, if necessary. This is expected to lead to hassle costs savings for consumers in particular in PO 3.1 and PO 3.3, estimated at EUR 522.5 million and EUR 104.5 million, respectively. The new fixed reimbursement deadline of 7 days for Merchant of Record intermediaries under PM C.3 (PO 3.2 and PO 3.3) will also lead to time savings for all cases where the intermediaries’ terms and conditions foresee a reimbursement deadline that is longer than 7 days. The new deadline will also provide clarity to consumers where the intermediary’s terms and conditions do not stipulate any clear maximum payment deadline.

Intermediaries would benefit of administrative costs savings of EUR 828.5 million in PO 3.1 for no longer carrying out the reimbursement requests. Under PO 3.3, the administrative costs savings (EUR 165.7 million) correspond to the share of passengers who choose to change the processing of the reimbursement from the intermediary to the air carrier. However, intermediaries may incur indirect costs, which cannot be quantified, as a result of no longer (or to a lesser degree) being able to offer the processing of reimbursements to their customers (and to airlines, as part of their agreements with them) as part of their service package. This would damage to a certain extent their business model of maintaining an exclusive relationship with their customers, which is why the intermediaries said in the stakeholder consultation that they are in favour of continuing to process reimbursement for their customers.

Net benefits are estimated to be the highest in PO 3.2 (EUR 1,621.6 million), followed by PO 3.3 (EUR 1,266.6 million) and PO 3.1 (EUR 310.5 million). PO 3.2 also shows the highest benefits to costs ratio (see Table 28). Thus, PO 3.2 is considered the most efficient option.

Table 28: Summary of costs and benefits of policy options under the problem area 3 - expressed as present value over 2025-2050 relative to the baseline, in million EUR (2021 prices)

Source: PWC, TIS and Steer (2023), Impact assessment support study

There is high uncertainty regarding the hassle costs and costs savings estimated for consumers. A conservative approach (lower bound estimate) has been used for the calculations above. When considering the higher bound estimate of the hassle costs and costs savings, the net benefits are estimated at EUR 1,467.1 million in PO 3.1, EUR 3,300.7 million in PO 3.2 and EUR 2,748.5 million in PO 3.3. In terms of benefits to costs ratio, the ranking of the policy options does not change.

7.3Coherence

Internal coherence assesses how various elements of the initiative function together to achieve the objectives. The policy options are coherent across the three problem areas. Furthermore, the policy measures enhancing the enforcement are expected to contribute strongly to the success of the policy measures related to reimbursements and multimodal travel. PM A.4 included in PO 1.2, under which NEBs shall perform compliance monitoring activities of the industry stakeholders based on a risk assessment, may include the monitoring of the respect of the reimbursement deadlines by carriers and intermediaries.

External coherence concentrates on the compliance of the initiative with national policies, other EU instruments and relevant EU policies, as well as international obligations.

PO 1.1 and PO 1.2 are coherent with the existing EU legal framework on passenger rights. The policy measures common to both PO 1.1 and PO 1.2 intend to harmonise passenger rights across modes of transport. They would introduce certain passenger rights or NEB and industry obligations already existing in the new Rail Passenger Rights Regulation or in the 2013 Commission proposal on air passenger rights to the other Regulations. PO 1.1 and PO 1.2 are also coherent with other EU instruments aimed to enhance enforcement in Member States, especially concerning the ADR procedures and the CPC network which ensure strong powers for cross border enforcement. Under both policy options, the NEBs’ role will be strengthened, and the Commission will be given a role in order to ensure an EU wide perspective of enforcement, which will help the NEBs in the CPC network by ensuring that NEBs are aware of the situation in other Member States. Increased awareness of passengers about the possibility to address themselves to ADRs ensures cooperation between different instruments in place in a Member State, that passengers can use in cases where their rights have not been observed.

PO 2.1, PO 2.2 and PO 2.3 are all coherent with the existing EU legal framework on passenger rights. More precisely, the proposed intervention aims to protect passengers performing a multimodal journey in a way similar to those passengers undertaking a journey with one single mode of transport (e.g. information, reimbursement, re-routing, care, assistance to PRM) and builds on currently existing mechanisms to ensure the application of passengers’ rights (Single Point of Contact for PRM, complaint-handling, enforcement). These three options also show strong links with the revision of Delegated Regulation 2017/1926 on Multimodal Travel Information Services (MMTIS) that aims to improve the information service for passengers.

Policy options PO 3.1, PO 3.2 and PO 3.3, and in particular the latter two, build on the Commission’s proposal of 2013 175 to amend Regulation (EC) No 261/2004 on air passenger rights and complement it. According to the proposal, for the purpose of informing passengers about cancellations or delays in departure, the intermediary through whom the passenger acquired a ticket has two possibilities: it either provides the passenger’s contact details to the air carrier, on condition that the passenger has given his explicit and written authorisation, on an ’opt-in’ basis, or it proves the existence of an alternative system that ensures that the passenger is informed without the transmission of the relevant contact details. In addition, the (in total) 14-day reimbursement period from the passenger’s request and when an intermediary is involved (under PO 3.2 and PO 3.3) creates an alignment with the Package Travel Directive, which already includes this same 14-day reimbursement period when the package travel organiser needs to reimburse a package traveller.

The currently ongoing review of the Package Travel Directive 176 assesses as part of one option a 7-day deadline for the airline’s reimbursement of tickets as part of a package to the package travel organiser in case the airline cancels the flight. This aligns with the 7-day deadline that this initiative’s PO 3.2 (and PO 3.3) includes for reimbursements of single tickets from the airline to the intermediary, where the intermediary processes the reimbursement.

7.4Subsidiarity and proportionality

None of the options go beyond what is necessary to achieve the objectives of the initiative.

Effective enforcement of rules (PO 1.1 and PO 1.2) rests on the cooperation between Member States. Therefore, intervention at EU level is needed to ensure that enforcement occurs in an aligned manner across Member States, so that all passengers effectively enjoy their passenger rights in a harmonised way, through a facilitation of efficient correspondence and knowledge sharing between Member States.

The three options addressing problem 2 related to multimodal journeys (PO 2.1, PO 2.2 and PO 2.3) cover the same scope as the existing EU passenger rights framework (rail, bus and coach for long distance journeys, waterborne and air) and seek to address a gap in EU legislation which, if left at national level, would create the risk of distortions or potential negative spill-over effects.

Regarding the three options addressing problem 3, it should be recalled that the air travel distribution market in the EU is essentially cross-border, with some of the largest intermediaries being international market players. Individual national action or action in only a limited number of Member States would not be beneficial to the EU consumer and would lead to distortions of the internal market.

In relation to proportionality, each of the policy options addressing the three problems identified contributes to achieving the general objectives and the measures proposed are proportionate in view of the specific objectives.

On enforcement, both PO 1.1 and PO 1.2 address SO1 (Ensure effective and efficient enforcement across all Member States) and SO2 (Ensure effective complaint handling for passengers). PO 1.1 introduces measures already established for rail and proposed for air passenger rights (2013 proposal) to the other modes of transport. In PO 1.2, two additional policy measures (obligation to NEBs to carry out their monitoring activities following a risk assessment and obligation for carriers and terminal operators to better inform passengers about their rights, notably when booking a ticket or in case of a transport disruption) are included to address more effectively the issues of passengers’ low awareness of their rights and of the diverging scope of NEBs’ actions. Both additional policy measures leave carriers and terminal operators, as well as NEBs, flexibility on how they want to implement them. As PO 1.2 addresses two important aspects of the general objective that PO 1.1 does not address, but the additional policy measures leave flexibility for carriers, terminal operators and NEBs respectively to implement them, PO 1.2 is considered more proportionate than PO 1.1.

Among the three options addressing problem 2, PO 2.2 is assessed to be more proportionate than PO 2.1 and PO 2.3. This option is highly effective in addressing both SO3 (Increase protection of passengers facing travel disruptions in the context of multimodal journeys) and SO4 (Increase information for and assistance of persons with disabilities or reduced mobility when switching between transport modes), while at the same time not going beyond what is necessary for achieving the objectives. In particular, the measures in PO 2.2 aim at complementing the current market structure. Single contracts of carriage, on the one hand, imply a certain degree of arrangements and cooperation mechanisms between transport providers to ensure the passenger’s transfer from one transport mode to the other. The proposed measures would therefore aim to specify the level of service to be granted to passengers in a context where the transport operators are in a position to deliver such assistance. Separate tickets, on the other hand, suggest the absence of cooperation between transport providers. Therefore, when these tickets are offered together, this lack of arrangements between transport operators should be made clear to passengers, while at the same time avoiding creating an undue burden on ticket vendors and tour operators who, as a general rule, do not operate transport services themselves. In the same vein, PO 2.2 is more proportionate than PO 2.3 in view of the sanction to be applied when ticket vendors and tour operators do not provide this information. Whereas in PO 2.2 this sanction consists of a reimbursement of the amount paid for the tickets by the passenger and an additional penalty of 75% of that amount, the sanction under PO 2.3 would consist of ensuring rights to passengers as if the ticket vendors and tour operators would be carriers themselves (i.e. reimbursement, re-routing, care, right to alternative transport contract). PO 2.2 is also more proportionate than PO 2.1, where the latter does not foresee any sanction to incentivise ticket vendors and tour operators to provide such information.

Both PO 3.1 and PO 3.3 (for the part that will be processed by carriers directly and which was formerly processed by intermediaries) are less proportionate than the baseline, because they deviate from established industry practice. PO 3.2. reflects the established industry practice, i.e. how the air travel and distribution industry operates, and is therefore the most proportionate option. Processing the reimbursement requests of their customers is part of the (full service) business model of intermediaries, and also what is expected under their current agreements with many airlines 177 . PO 3.2 is also the only option of the three which reflects the current air carrier distribution models, with airlines adopting different policies for the reimbursement of tickets booked by intermediaries, depending on their business model. Most carriers (network and small low-cost carriers) sell a large share of tickets via intermediaries and have agreements with these in place (including for reimbursements) 178 . However, currently, at least one large low-cost carrier allows only the purchase of its tickets, if done online via its website directly by the passenger and does not use intermediaries (or only in a very restricted form). Nevertheless, intermediaries do in certain instances purchase tickets from carriers with a full or partial preference/model for direct distribution to the passenger, often without the knowledge of the carrier. This creates difficulties when it comes to reimbursements, as the carrier may refuse to perform reimbursements via the intermediaries in this context. However, only the intermediary may hold the key information necessary for the reimbursement such as the bank details and payment method for the reimbursement or the passenger’s contact details. Under PO 3.2, these carriers can continue their current practice of asking passengers to carry out the reimbursements directly with them. PO 3.2 is the least intrusive in terms of market practice.

Table 29 provides a summary of the comparison of the options against the baseline scenario in terms of effectiveness, efficiency, coherence, subsidiarity and proportionality. The following ranking symbols have been used: from '+' (more effective/efficient/coherent/ proportionate than the baseline) to '+++' (much more effective/efficient/coherent/proportionate than the baseline); from '-' (less effective/efficient/coherent/proportionate than the baseline) to '---' (much less effective/efficient/coherent/ proportionate than the baseline).

Table 29: Comparison of options in terms of effectiveness, efficiency, coherence, subsidiarity and proportionality relative to the baseline

8Preferred options

8.1Identification of the preferred policy options and stakeholder views

8.1.1Preferred policy option and stakeholder views for problem area 1 (Passengers do not fully benefit from their rights due to shortcomings in implementation and enforcement)

The preferred policy option for problem area 1 is PO 1.2, which is the policy option that best ensures that carriers and terminal operators contribute to the effective complaint handling for passengers, and that NEBs further the effectiveness and efficiency of enforcement across all Member States.

While the two policy options do not directly differ in the scope of passengers protected, the two options do differ in degree of protection, as PO 1.2 goes further to align enforcement efforts across Member States and to help ease the complaint handling for passengers. PO 1.2 targets the issue of lack of harmonisation of enforcement across Member States directly by obliging NEBs to have their enforcement efforts based on risk assessments and for these risk assessments to be published. PO 1.2 also directly targets the issue of lack of passenger’s awareness of their rights, by ensuring that passengers are provided with the information they need, when they need it, where they are. As such, to exclude these policy measures by choosing PO 1.1, would weaken the effectiveness significantly, as PO 1.1 exclusively aims at harmonisation between modes of transport, while PO 1.2 goes significantly further to accomplish the specific objectives. PO 1.2 is thus assessed to be much more effective than PO 1.1 in achieving the objectives. 

In terms of efficiency, both PO 1.1 and PO 1.2 perform equally as they lead to similar benefits to costs ratios.

In terms of coherence and subsidiarity both PO 1.1 and PO 1.2 perform similarly. However, as explained in section 7.4, PO 1.2 is assessed to be more proportionate than PO 1.1. Thus, the analysis points to PO 1.2 as the most balanced option in addressing both SO1 and SO2, and therefore as the preferred option.

Many national enforcement bodies (NEBs), carriers and terminal operators support PO 1.1, as it does not include obligations on risk assessments and an additional obligation to inform passengers about their rights when buying a ticket or in case of a transport disruption for these stakeholders. PO 1.2 is supported by consumer organisations as the option goes further on obligations for carriers and terminal operators to provide passengers with information on their rights. Well performing NEBs, carriers, terminal operators and intermediaries also support PO 1.2, as it ensures that the NEBs monitoring, and enforcement activities are more transparent and predictable.

8.1.2Preferred policy option and stakeholder views for problem area 2 (Insufficient protection of passengers during multimodal journeys)

The preferred policy option for problem area 2 is PO 2.2, which ensures a fair balance between the effectiveness of the intervention in addressing SO3 and SO4 for multimodal passengers, including PRM, and efficiency in terms of benefits to costs ratio, given that this market is under development (see section 2.2.4). PO 2.2 is also the most proportionate option and performs the same as PO 2.1 and PO 2.3 in terms of coherence and subsidiarity.

With regard to effectiveness, PO 2.2 not only ensures that all passengers performing multimodal travel are well informed before and during their journey, but also provides for a basic set of rights for multimodal passengers having a single contract as well as improved information on the separate nature of the tickets to passengers having acquired such tickets for a multimodal journey from a ticket vendor or tour operator. The measures would therefore cover the entire multimodal passenger market (estimated at 91 million passengers in 2019) as regards the provision of pre-journey information and contains additional measures for both main sub segments of this market (single contracts (5%) and separate tickets (95%)), meaning that this option would be highly effective in achieving SO3. At the same time, the measures covered by this option would be very effective in addressing SO4, where PRM would not only be entitled to the right to non-discrimination and free assistance when travelling with a single contract of carriage, but also by the establishment of Single Points of Contact at multimodal hubs (and possibly beyond), thereby potentially covering the entire multimodal passenger market.

Even though PO 2.1 is more efficient than PO 2.2 in terms of benefits to costs ratio, the measures envisaged therein would only partially cover the multimodal market and therefore be less effective in achieving SO3, where it only provides for basic information rights for all multimodal passengers (e.g. on the type of multimodal ticket) as well as basic rights for single contracts of carriage for multimodal journeys (category A). As mentioned above, such single contracts only represent a small fraction (circa 5%) of the entire multimodal market. In addition, the measures in PO 2.1 would concern those single contracts of carriage that do not include an air leg, whereas nearly all multimodal products concern an air leg (see sections 2.2.4 and 5.2.2). No particular measures would be foreseen in addition for passengers having separate contracts (category B). Moreover, this policy option would only marginally consider the protection of PRMs who are not travelling on such single contracts, where they would only be entitled to pre-journey information on the accessibility of transport infrastructure when switching between modes. PO 2.1 would therefore be significantly less effective than PO 2.2 and PO 2.3 in achieving SO 3 and SO4. On the other hand, PO 2.3 is equally efficient to PO 2.2 in terms of benefits to costs ratio, whereas it only provides for a marginal increase in effectiveness in addressing SO3 (by introducing a full set of rights for both passengers travelling on single contracts (category A) and those travelling on separate tickets (category B)) and no additional benefits with regard to effectiveness in addressing SO4.

In terms of coherence and subsidiarity, all options perform equally. However, as explained in section 7.4, PO 2.2 is more proportionate than both PO 2.3 and PO 2.1. Thus, the analysis points to PO 2.2 as the most balanced option in addressing both SO3 and SO4, and therefore as the preferred option.

Consumer associations support PO 2.3, as it would entail a high protection of consumers. Carriers and intermediaries rather support PO 2.1 in view of the current level of development of the multimodal ticketing market. NEBs are more favourable to PO 2.2.

8.1.3Preferred policy option and stakeholder views for problem area 3 (Reimbursement rules are unclear when flights were booked via an intermediary)

The preferred option for problem area 3 is PO 3.2, which is the most efficient and proportionate option of the three. Together with PO 3.1, it is also the most effective one.

Both PO 3.1 and PO 3.2 are equally effective in providing clarity on the reimbursement process; PO 3.3 slightly less so because the passenger will need to inform the carrier and the intermediary simultaneously of their choice.

In terms of efficiency, PO 3.2 is much more efficient than both PO 3.3 and PO 3.1, with a much higher benefits to costs ratio (29.2 in PO 3.2 relative to 2.9 in PO 3.3 and 1.1 in PO 3.1). It is also by far the cheapest option as the most expensive element - the carrier’s (mostly non-automated) processing of the reimbursement - is limited under this option.

PO 3.2 is coherent with the Commission’s 2013 proposal to amend Regulation (EC) No 261/2004 on air passenger rights and complements it. The 14-day reimbursement period when the intermediary is involved also creates an alignment with the Package Travel Directive, where the package travel organiser also needs to reimburse the traveller within 14 days. PO 3.2 performs the same as PO 3.3 in terms of coherence and better than PO 3.1.

In terms of subsidiarity, all three policy options perform the same. However, PO 3.2 is the most proportionate of the three options because it interferes the least in the current market practice, where intermediaries process reimbursements for their customers as part of their business model, and carriers are paying for systems like the BSP 179 , which facilitates the financial flows between airlines and intermediaries. PO 3.2 also follows best the current air carrier distribution model, with about 92% of tickets being processed through the “reversal of the payment flow” model. It will allow those air carriers that do not want to involve intermediaries for reimbursements to do so. Generally speaking, it will enable air carriers to follow a “pick and choose” approach with regard to intermediaries: cooperating with those they trust, and not to cooperate with those they don’t trust. This will also benefit the passenger, as the passenger cannot be expected to have the market knowledge of which intermediary may abide by the rules, and which may not.