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Incorrect Information Provided by the Tour Operator

Incorrect Information Provided by the Tour Operator

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The European Court of Justice (ECJ) ruled in joined cases C-650/23 and C-705/23 that a passenger who had a confirmed booking for a flight on the basis of a package tour can claim compensation from the operating air carrier within the meaning of Art 7 (1) of Regulation (EC) No 261/2004 even if incorrect information provided by the tour operator led to the passenger believing that the flight originally booked would not be operated, although it took place as planned.

The decision concerns a flight from Heraklion (Greece) to Linz (Austria). One day before the scheduled departure, the passenger was informed by the tour operator of a change in flight times and the destination airport. For this reason, the passenger did not show up for check-in for the flight in question. However, the flight was actually carried out as planned; the tour operator’s information was therefore incorrect. The passenger then demanded compensation from the operating air carrier and based his claim on Article 4 of Regulation (EC) 261/2004 (denied boarding). The Schwechat District Court awarded him this compensation, but the airline appealed against this decision to the Korneuburg Regional Court. The airline’s two main arguments were the missing of the facts of denied boarding and the lack of accountability of a rebooking by the tour operator.

The Regional Court of Korneuburg initiated a preliminary ruling procedure and wanted to know from the European Court of Justice whether a passenger who has a confirmed booking as part of a package tour can claim compensation from the operating airline if the tour operator has informed the passenger without prior consultation with the airline that the booked flight will not be carried out, although in reality it took place as planned.

Referring to its previous case law and the aim of Regulation (EC) 261/2004 to ensure a high level of protection for passengers, the European Court of Justice ruled that the operating air carrier is liable for incorrect information provided by the tour operator to passengers regarding the rescheduling or cancellation of a flight. Furthermore, the ECJ referred to the possibility of the operating air carrier to have recourse against the tour operator in accordance with Art. 13 of the Regulation.

Don’t hesitate to contact our Aviation Team to learn more about passsenger claims in Austria.

Technical Failures

Technical failure affecting a new aircraft model

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The European Court of Justice (ECJ) ruled in case C-385/23 that the occurrence of an unexpected and unprecedented technical failure affecting a new aircraft model may constitute extraordinary circumstances within the meaning of Article 5 (3) of Regulation (EC) No 261/2004.

The case at hand concerns a flight from Helsinki (Finland) to Bangkok (Thailand) that was to be operated by an aircraft which had entered into service just over five months earlier. However, the fuel gauge of that aircraft experienced a technical failure during refueling shortly before take-off, which resulted in the cancellation of the flight due to safety concerns. Neither the aviation safety authority nor the aircraft manufacturer was aware of the defect prior to this incident. It was later on discovered that the reason for the failure was a hidden design defect affecting all aircraft of the same type.

Based on these facts of the case, the operating air carrier was of the opinion that the cancellation was necessary due to extraordinary circumstances and, therefore, refused to pay compensation payments to passengers.

The ECJ decided that such technical failures affecting a new aircraft model recently put into service where the manufacturer of that aircraft recognises that the failure was caused by a hidden design defect conerning all aircraft of the same type and impinging on flight safety are covered by the concept of extraordinary circumstances within the meaning of Article 5 (3) of Regulation (EC) No 261/2004.

Don’t hesitate to contact our Aviation Team to learn more about passsenger claims in Austria.

Lack of Airport Staff

Lack of airport staff as extraordinary circumstances

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The European Court of Justice (ECJ) ruled in case C-405/23 that the lack of airport staff may constitute extraordinary circumstances within the meaning of Article 5 (3) of Regulation (EC) No 261/2004.

In the case at hand, a delay of more than 3 hours occurred, inter alia, because the loading of baggage onto the plane had been slowed down as there had been an insufficient number of staff of the airport operator responsible for that service. The question whether such lack of airport staff may constitute extraordinary circumstances was referred to the ECJ by the regional court of Cologne in its role as court of appeal.

The ECJ cited its prior ruling C-308/21 in which it was stated that general failures of an airport´s refueling system are not to be regarded as being intrinsically linked to the operation of the aircraft which completed the delayed flight. According to the ECJ, it is for the referring court to determine, whether the failures of the baggage loading operations due to a lack of airport staff must be regarded as a general failure in accordance with the cited case law. Regarding the criterion that extraordinary circumstances must also be beyond the air carrier´s control, the ECJ stated that it is for the referring court to determine whether the air carrier was able to exercise effective control over the operator of the airport.

It was further emphasized that extraordinary circumstances alone are not sufficient to relieve air carriers from their obligation to pay compensation to passengers. Air carriers must additionally state and proce that they took all reasonable measures appropriate to the situation.

Don’t hesitate to contact our Aviation Team to learn more about passsenger claims in Austria.

The legal basis and the transferability of passenger rights

The legal basis and the transferability of passenger rights

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The European Court of Justice (ECJ) ruled in case C-11/23 that the entitlement to compensation for flight cancellations stems directly from Regulation (EC) 261/2004 and is independent from a contract of carriage the parties may have or may have not entered into. This clarifies that passengers have a right to compensation regardless of contractual stipulations, provided that they meet the conditions set forth in the Regulation.

Additionally, the ECJ stated that clauses within an air carrier´s General Conditions of Carriage (GCC) that limit a passenger´s options to transfer his rights granted by Regulation (EC) 261/2004 constitutes an impermissible restriction of his rights and is, therefore, null and void. The ECJ highlighted that in order to ensure a high level of protection for passengers, it is necessary to guarantee those affected by a cancellation the freedom to choose the most effective way to defend his or her right, including (where provided for by the relevant national law) to transfer his or her claim to a third party.

More detailed information on the use of GCC in Austria can be found in our article “General Conditions of Carriage in Austria“.

Don’t hesitate to contact our Aviation Team to learn more about passsenger claims in Austria.

Urteil zu ABB

Ruling on the GCC of a Hungarian Airline

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The Austrian Supreme Court recently issued a new ruling (4 Ob 222/22h) on the General Conditions of Carriage (GCC) of a Hungarian airline, declaring numerous clauses therein as unlawful. This decision is the latest in a series of judgments against air carriers and their GCC.

The proceedings were initiated by the “Bundeskammer für Arbeiter und Angestellte”, an association authorized to litigate under the Austrian Consumer Protection Act and aimed to prohibit the airline from using certain clauses in their GCC. In its decision, spanning over 100 pages, the Austrian Supreme Court addressed numerous clauses, providing significant guidance for all air carriers operating in Austria.

Since authorized associations, especially the “Verein für Konsumenteninformation” (VKI) and the Bundeskammer für Arbeiter und Angestellte, can (and regularly do) file such lawsuits against airlines operating in Austria, it is advisable for air carriers to use this new ruling on GCC as an opportunity to review their own GCC. More detailed information on the standard procedures of associations authorized to file such lawsuits, the system of reviewing GCC in Austria, and the criteria applied can be found in our article “General Conditions of Carriage in Austria“.

The clauses whose use has now been prohibited by the Austrian Supreme Court include:

  • Liability exclusion for fragile luggage
  • Choice of law clause in favor of Hungarian law
  • The possibility of rebooking to an alternative means of transportation
  • Restriction of rights under Regulation (EC) 261/2004 (“Air Passenger Rights Regulation”)
  • Submission of compensation claims exclusively via the airline’s website

Our experienced Aviation Team is happy to answer your questions about the use of General Conditions of Carriage in Austria, review your GCC to reduce the risk of legal proceedings, and represent you in court.

The necessity to suffer a loss of time to receive compensation

The necessity to suffer a loss of time to receive compensation

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In its recent rulings on cases C-474/22 and C-54/23, the European Court of Justice (ECJ) clarified that passengers are not entitled to a compensation payment in cases when their booked flight is delayed by more than 3 hours if they did not actually suffer a loss of time themselves, especially if they did not present themselves for check-in.

Traditionally, passengers whose flights arrive over three hours after the scheduled arrival time have been entitled to the same compensation passengers of cancelled flights receive. This principle was established in the landmark Sturgeon ruling (C-402/07 and C-432/07). However, the recent ECJ rulings demonstrate that there are still differences between flights that are cancelled and those that are significantly delayed.

The cases in question both involved flights from Düsseldorf (Germany) to Palma de Mallorca (Spain) where the operating carriers announced significant delays. In case C-474/22, upon learning of the delay, the passenger chose not to board the flight and later assigned his rights to flightright, which then sued the carrier for compensation. In case C-54/23, another passenger opted to book an alternative flight, resulting in an arrival delay of less than three hours.

The ECJ ruled that in both instances, the passengers are not eligible for compensation. This decision was based on Article 3 of Regulation 261/2004, which sets forth that the regulation only applies if passengers – except in cases of cancellations – present themselves for check-in in a timely manner. The passengers argued that this criterion should not apply in situations where the operating carrier had already announced that the flight would be delayed more than 3 hours, since such significant delays must be treated like cancellations.

However, the ECJ did not follow this reasoning ant stated that its landmark decision in the Sturgeon case was based on the concept that passengers enduring a delay of three hours or more suffer an irreversible loss of time and, consequently, a level of inconvenience comparable to that of passengers on cancelled flights. According to the ECJ’s rationale, compensation is a redress for this loss of time. Therefore, since the passengers in the recent cases either did not board their flights or managed to reduce their delay through alternative bookings, they did not experience the same loss of time and are, thus, not entitled to compensation.

However, it’s important to note that these passengers might still have other rights under Regulation 261/2004 or applicable law, such as ticket reimbursement or damages equivalent to the costs of the alternative flights they booked.

Don´t hesitate to contact our Aviation Team to learn more about passenger claims in Austria.

Holger Börsepeople Podcast

Börsepeople Podcast mit Holger Schmidtmayr

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Das neueste Mitglied unseres Weisenheimer-Teams, Holger Schmidtmayr, ist zu Gast bei Christian Drastil in seinem erfolgreichen Podcast “Börsepeople”.

In dieser Folge erzählt Holger von seiner Zeit als Vorstand der S IMMO AG und spricht unter anderem über die Erste Bank, alternative Roadshows, Selbständigkeit, Weisenheimer Legal und große Persönlichkeiten bis hin zu Warren Buffett.

Für alle Interessierten ist die Folge unter dem folgenden Link abrufbar: https://boersenradio.at/page/podcast/5166/

Flexible Kapitalgesellschaft

Die Flexible Kapitalgesellschaft

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Die neue Flexible Kapitalgesellschaft bietet einige Vorteile gegenüber der klassischen GmbH:

✔ Die Flexible Kapitalgesellschaft kann Unternehmenswert-Anteile ausgeben, die im wesentlichen einem Genussrecht entsprechen. Anders als das Genussrecht kann ich diese Unternehmenswert-Anteile aufsummiert aber im Firmenbuch eintragen lassen. Das erhöht die Transparenz meiner Kapitalstruktur.

✔ Die neue Gesellschaftsform bietet mehr Flexibilität bei der Aufnahme von Eigenkapital. So kann die Flexible Kapitalgesellschaft – anders als die GmbH – wie die AG bedingtes und genehmigtes Kapital schaffen. Das erleichtert die Ausgabe von gerade im Bereich der Start-up-Finanzierung beliebten Wandlungsinstrumenten.

✔ Bei der Flexiblen Kapitalgesellschaft können die Anteile in Stückanteile geteilt werden, was anders als bei der GmbH dem “1 Euro 1 Share Prinzip” entspricht, das international üblich und daher für internationale Investoren besser verständlich ist als das Prinzip “ein Geschäftsanteil je Gesellschafter”.

✔ Und schließlich kann die Flexible Kapitalgesellschaft in durchaus erheblichem Umfang eigene Anteile erwerben.

Aber es drängt sich die Frage auf, warum all diese Vorteile nur eine neu gegründete Flexible Kapitalgesellschaft genießen soll. Warum sollen nicht auch etablierte KMU in Form einer GmbH erleichterten Zugang zu Kapital haben etc.? Wäre es nicht ein Einfaches gewesen, all diese Maßnahmen in das GmbHG zu übernehmen? Die Antwort darauf kennt allein der Gesetzgeber.

Die gute Nachricht ist aber, dass eine GmbH relativ einfach in eine Flexible Kapitalgesellschaft umgewandelt werden kann. Es lohnt sich daher auch für bestehende GmbHs, die Möglichkeiten der Flexiblen Kapitalgesellschaft zu prüfen und gegebenenfalls den Schritt zu wagen, um die Flexibilität und finanzielle Leistungsfähigkeit des Unternehmens zu stärken.

Der Wechsel der Rechtsform ist relativ einfach und kostengünstig. Die Flexible Kapitalgesellschaft behält dabei ihre Rechtspersönlichkeit, ihre Steuernummer und ihre Firmenbuchnummer bei. Die bestehenden Verträge, Rechte und Pflichten der GmbH werden von der Flexiblen Kapitalgesellschaft im Wege der Gesamtrechtsnachfolge übernommen.

Für Fragen steht unser Team gerne zur Verfügung!

Grüne Investitionen voranbringen: Weisenheimer berät PV-Invest bei ihrer aktuellen Anleiheemission

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Wir freuen uns, PV-Invest bei ihrer aktuellen Anleiheemission begleiten zu dürfen. Der österreichische Pionier im Bereich erneuerbarer Energien hat sich als wegweisender Akteur auf dem Anleihemarkt für Green Bonds von kleinen und mittleren Unternehmen (KMU) etabliert. Die Zusammenarbeit markiert einen weiteren Meilenstein in unserer langjährigen Partnerschaft mit PV-Invest.

Unser Team rund um Partner Robert Leuthner hat das Unternehmen umfassend im Zusammenhang mit der Anleihe, der Erstellung des Wertpapierprospekts, dem öffentlichen Angebot und der Billigung durch die luxemburgische Finanzmarktaufsichtsbehörde (Financial Sector Supervisory Commission – CSSF) rechtlich beraten. Die Förderung und Unterstützung nachhaltiger Finanzierungsformen und grüner Investitionen ist uns seit jeher ein wichtiges Anliegen.

Günter Grabner, Geschäftsführer von PV-Invest, über die Zusammenarbeit: „Die Unterstützung durch Weisenheimer Legal war für uns überaus wertvoll. Die Expertise von Robert Leuthner hat uns dabei geholfen, einen bedeutenden Beitrag zur Förderung von grünen Finanzierungsmechanismen zu leisten.“

Mit der erfolgreichen Realisierung dieses Green-Bond-Angebots konnten wir unser Fachwissen beweisen und Engagement für die Förderung nachhaltiger Investitionen in der Finanzbranche, insbesondere für kleinere und mittlere Unternehmen in Österreich, zeigen. Wir sind weiterhin bestrebt, unsere Kunden bei der Umsetzung von Projekten zu unterstützen, die eine positive ökologische und wirtschaftliche Wirkung haben.

Denied Boardings

Recent court practice on denied boardings

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On 26 October 2023, the European Court of Justice (ECJ) issued a new ruling on the interpretation of Articles 4 and 5 of Regulation 261/2004 in connection with denied boardings (case C-238/22).

In this ruling, the ECJ determined that an air carrier that informs a passenger in advance that, against the passenger´s will, they will be denied boarding for a flight with a confirmed reservation, must compensate that passenger, even if the passenger does not present themselves for boarding.

In the case at hand, the air carrier denied transporting the passenger on the inbound flight because they had not taken the outbound flight, a common practice based on so-called “No-Show Clauses”.[1] The ECJ interpreted this application of a No-Show-Clause as a denied boarding, disregarding the interpretative guidelines on Regulation 261/2004 published by the EU Commission on 10 June 2016.

Furthermore, the ECJ ruled that Article 5(1)(c)(i) of Regulation 261/2004 does not apply to cases in which passengers are denied boarding. Therefore, the air carrier must provide compensation payments (Article 7) to passengers, even if they informed the passengers at least two weeks in advance that they will refuse to carry them.

On 11 July 2023, the Austrian Regional Court Korneuburg faced a case (22 R 120/23m) with the following circumstances:

An air carrier was confronted with a shortage of security staff at its homebase (LHR) in the aftermath of the COVID-19 pandemic, resulting in difficulties in handling a sudden increase in passenger numbers during the travel boom following the end of COVID-related travel restrictions. As a response, the air carrier decided to “cancel” several flights due to the challenges in performing the required security checks on the passengers.

The “canceled” flights were, in fact, performed by the air carrier, using the planned time slots, flight numbers and destinations, but with cargo only – without passengers on board.

The Regional Court Korneuburg, serving as the court of appeal, determined that such cases do not constitute a cancellation within the meaning of Article 5 of Regulation 261/2004 but rather constitute denied boardings within the meaning of Article 4.

Additionally, the court emphasized that, in cases of denied boardings, it is irrelevant if the reasons for such denied boardings could constitute extraordinary circumstances within the meaning of Article 5. According to the applicable Article 4, air carriers are always obligated to immediately compensate passengers in accordance with Article 7 if they are denied boarding against their will.

According to Article 2(j) “denied boarding” means a refusal to carry passengers on a flight, except where there are reasonable grounds to deny them boarding, such as reasons of health, safety or security, or inadequate travel documentation. The court concluded (citing ECJ case C‑321/11, 32) that a reason for a denied boarding must be attributable to the passenger who is being denied boarding.

Since the reason for the air carrier´s decision not to transport passengers on the flight in question was not in any way attributable to the passenger, there were no reasonable grounds within the meaning of Article 2(j) for the denied boarding. Consequently, the Regional Court Korneuburg ruled in the passenger´s favor and ordered the air carrier to pay compensation to the passenger.

Don´t hesitate to contact our Aviation Team to learn more about passenger claims in Austria.