CJEU: inclusion of flight cancellation insurance as a default setting unlawful when selling air tickets over the internet

Michael Wukoschitz's picture

A German consumer-protection association has taken proceedings against ebookers.com before the German courts with a view to requiring that company to refrain from automatically including cancellation insurance with the air fare:

ebookers.com Deutschland operates an online portal by which it sells air travel. When a customer selects a specific flight during the booking process, the costs are listed in the top right-hand corner of the internet page, under the heading ‘your current travel costs’. In addition to the price of the flight, that list also contains amounts in respect of ‘taxes and fees’ and ‘cancellation insurance’, calculated automatically. The total of those costs represents the ‘total price of travel’. A notice at the bottom of the internet page indicates how the customer should proceed if he wishes to reject the cancellation insurance which has been included as a default setting. That procedure is by means of an opt-out. Once the customer pays after finalising his booking, ebookers.com then pays the flight costs to the air carrier, the taxes and fees to the appropriate authorities and the insurance premium to the insurance company, which is legally and economically separate from the air carrier.

Upon reference for preliminary ruling by the German Oberlandesgericht Köln (Higher Regional Court, Cologne), the CJEU today has held that the concept of ‘optional price supplements’ pursuant to Regulation No 1008/2008 on common rules for the operation of air services in the Community covers costs, connected with the air travel, arising from services – such as flight cancellation insurance – supplied by a party other than the air carrier and charged to the customer by the person selling that travel, together with the air fare, as part of a total price.

The Court points out, first of all, that EU law seeks to ensure that there is information and transparency with regard to the prices for air services, and thus contributes to safeguarding customer protection. It finds that ‘optional price supplements’ relate to services which supplement the air service itself. Those services are neither compulsory nor necessary for the purposes of the flight and the customer may choose either to accept or refuse them. It is precisely because a customer is in a position to make that choice that EU law requires such price supplements to be communicated in a clear, transparent and unambiguous way at the start of each booking process, and that their acceptance must be on an opt-in basis.

Source: CJEU press release No 105/12 of July 19, 2012

Find full text of judgement C‑112/11 ebookers.com/Bundesverband der Verbraucherzentralen und Verbraucherverbände here>>.

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