Lawmakers agreed to update air passenger rights on 15 June after thirteen years of negotiations. The deal adds new protections, including banning the no-show clause and clarifying compensation and reimbursement, and maintains current protections for flight disruptions.

For two decades, airlines have avoided paying, leaving €3.2 billionunclaimed. Airlines contested claims and refused compensation. Consumer groups noted lengthy procedures, unclear policies, and confusing websites. Rights enforcement became a frustration for passengers.

This gap allowed claims agencies to create a new business model, exposing the failure of EU rules to protect travellers effectively.

“This failure has driven the growth of claim agencies. Ideally, passengers should be able to obtain compensation directly and easily, without having to rely on intermediaries”, Kristína Gírethová, aviation and rail policy officer at the European Consumer Association (BEUC), explained.

Why passengers struggle to exercise their rights

Awareness is the main reason. A survey by the claim agency AirHelp found that 79 per cent of respondents were unaware of their rights. Airlines informed travellers about their rights in only 40 per cent of cases.

Many passengers, even when aware of their rights, don’t act because of complex claims procedures and confusing airline websites. “Airlines have no intention of giving clear information”, Eric Napoli, chief legal officer at AirHelp explained.

“Low awareness and burdensome procedures have prevented many passengers from exercising their rights under EC261. Only 38 per cent of eligible passengers actually receive compensation. A majority of travellers do not even complain”, Gírethová told EU News.

Airlines often take advantage of the “extraordinary circumstances” clause to deny compensation, leaving passengers without leverage to challenge rejections. According to Napoli, “there is a huge difference between what the airline and what the passengers know […]. The consumer does not really have access to information on whether the airline is correct”.

AirHelp found that airlines wrongfully reject 52 per cent of claims due to alleged bad weather, insufficient passenger documentation, and technical problems.

“If you go to the airline and say your flight was delayed, and they say it was not their fault but an extraordinary circumstance, what can you do about it?”, Napoli told EU News.

Turning rights into payouts

“AirHelp acts as a group of lawyers but assists passengers more efficiently and at a lower cost”, Napoli explained. It offers a three-step system: “claim in 2 minutes; we handle everything; you win compensation”.

Passengers submit their flight details online. AirHelp uses an automated data system to determine if a flight was cancelled or delayed, the delay duration and its reasons. Then, AirHelp challenges the airline’s rejection.

“If the delay is not an extraordinary circumstance and therefore the airline should pay, we go to the airline […], and we show them that it can’t be bad weather because within five minutes, there were five other planes that took off”.

If necessary, claim agencies pursue legal action. AirHelp has so far secured compensation for more than 3 million passengers and won 99 per cent of cases, but only 2 per cent went to court.

“Airlines work with us on a regular basis to be very efficient. They know that we give them good claims. We often review them together and agree right on the spot. It’s a reduction of costs for them”.

Help comes at a cost

AirHelp keeps 35 per cent of successful compensations, with an additional 15 per cent for legal action. “We assume the cost of winning and losing. If you win, you pay. If you lose, you don’t”, Napoli explained.

“We reject 20 per cent of claims just up front because we know that the claim is not a good claim, and we have no incentive to take a losing claim because we have to pay if we lose”, Napoli said.

Critics, including the International Air Transport Association (IATA), label agencies as “claim farms,” accusing them of being “experts at gaming the system and leaching off passengers”.

“People know up front that they have to pay a fee”, Napoli said, adding that “for many, it’s better to pay and receive compensation than get nothing at all or risk expensive legal proceedings”. BEUC expects that almost 25 per cent of passengers entitled to compensation will turn to claims agencies by 2028.

“If everything worked, there would be no need for claim agencies. There wouldn’t be 12,000 court cases only in Berlin suing companies for compensation. This means that you are not protected and you look for protection from claim agencies”, MEP Andrey Novakov of the European People’s Party and rapporteur on air passenger rights in the Parliament said.

What the new rules mean for claim agencies

The new rules address issues that claim agencies have spent twenty years building their businesses on.

Starting mid-2027, airlines must notify passengers of their rights, provide clear instructions for claiming compensation, and send compensation forms electronically within 96 hours. They must acknowledge claims within 30 days and either repay or justify any refusal.

“The new rules shift the responsibility for seeking compensation to the airlines, to deal with bureaucracy, emails and forms”, Novakov explained, adding that this “will for sure make it easier for passengers to handle claims themselves”.

“The revised regulation maintains legal certainty regarding the concept of extraordinary circumstances. This should help prevent unjustified refusals of compensation claims by airlines”, Gírethová said.

National Enforcement Bodies “will be better equipped and are expected to act more proactively […] their role is now clarified and strengthened, with closer coordination across borders”, she added.

“If the rules become clearer, airlines provide information proactively and complaints are handled more efficiently, naturally some passengers will no longer feel the need to use claim agencies”, Novakov said.

Claim agencies will continue to play a role for passengers who prefer convenience over the hassle of filing claims on their own.

“At the same time, claim agencies provide a service that some passengers may prefer. I expect they will continue to play a role where passengers choose to use them. This reform is about giving people more choice, not less”, Novakov told EU News.