Airline sector: Should the debate on the guarantee fund be relaunched?

Visit European Union ministers met to discuss the creation of a guarantee fund to cover airline defaults, a subject long abandoned. Although this grouping does not promise immediate action, its importance lies in the resumption of discussions. ECTAA and member states such as Denmark, which has already set up such a fund, support this initiative. However, the shadow of the powerful airline industry lobby looms large, holding back concrete progress. This debate raises the question of protecting travellers in the event of insolvency.

The unexpected discussion within the European Union

Like a gift from heaven, the subject of the airline default guarantee fund resurfaced at the latest EU Transport Council. Although it seemed to have been buried, ministers from several Member States reopened the debate, offering a glimmer of hope to an industry in search of stability for its passengers.

The industry's constant battle

For years, the goal of passenger protection to the airlines' shortcomings is the driving force behind the industry. At every attempt, and despite efforts during the recasting of the Package Travel Directive, progress has met with oblivion, leaving the sector in limbo.

Ministers take a stand

On December 5, in spite of expectations that had been dashed, a number of ministers, including those from Netherlands, Portugal, Spain and SloveniaThe European Commission, the European Parliament, the Council of Ministers and the European Economic and Social Committee have dared to call for the relaunch of discussions on Regulation 261/2004 on air passenger rights. A strong gesture, welcomed by ECTAA, the tourism industry lobby, which sees it as a rare opportunity to make real progress on the issue.

A symbolic but significant step

While for some, the discussions still seem to be seen as a symbolic gesture rather than a concrete commitment, for others they mark a turning point. " It's not binding, but it's important" says ECTAA General Secretary Eric Drésin, pointing to the unusual alignment of governments with this cause.

Denmark: A model to follow?

While Europe procrastinates, the Denmark stands out for its encouraging example. Since 2015, a carrier-financed guarantee fund has been in place, turning a vision into reality despite threats from giants like Ryanair. This success story could well become a source of inspiration for the rest of Europe.

The omnipresence and resistance of lobbying

Yet the road to genuine protection remains paved with challenges. Powerful lobbying by the airline industry remains a serious obstacle. Faced with such opposition, the European Commission itself has struggled to sustain its proposals for increased protection, even as bankruptcies affecting millions of consumers continue unabated.

The pandemic context and the need to rethink the future

With the health crisis, the debate on sector support has become more important. The pandemic has accentuated existing vulnerabilities, prompting players to reconsider the importance of such a guarantee fund. As a result, the need for solid protection tools has been reinforced, fuelling hopes for more decisive collective action.

Airline sector: The Caisse de Garantie under debate

Argument	Description
Importance of the warranty	Protects travellers in the event of company bankruptcy.
Frequent bankruptcies	Between 2011 and 2019, 87 companies went bankrupt.
Environmental concerns	Risk of neglecting decarbonization in favor of guarantees.
Danish example	A guarantee fund has existed since 2015, financed by the carriers.
IATA's position	Refuses to create a guarantee fund.
Government support	An initiative supported by the ministers of certain EU countries.
Distribution player	Has been campaigning for a guarantee fund for years.
Suspension of discussions	The proposal has been blocked in the Council since 2013.
Post-Covid-19 perspective	Hope dashed by the health crisis.
The relaunch challenge	Need for financial support to revive the sector.

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