Under long-term maintenance, repair and overhaul (MRO) agreements, airlines must usually pay a certain rate per flight hour to obtain engine or other component maintenance and repair services or just to have access to a certain spare parts pool. However, during the COVID-19 pandemic, most airlines have ceased their entire flight operations. This article addresses possible contractual clauses and statutory rights on which a claim to adjust payment obligations under an MRO agreement may be based.
A recent Eilenburg Local Court decision highlighted that a booking or reservation confirmation issued to a passenger by a tour operator with whom a flight has been booked should not necessarily be regarded as a confirmed booking under Article 3(2)(a) of the EU Flight Delay Compensation Regulation, even if the booking is referred to as an 'e-ticket voucher'. This decision underlines that the burden of proof for the existence of a confirmed booking will be borne by the passenger.
The Hamburg State Court recently rejected a damages claim arising from the cross-border transport of goods from the United States to Germany. The consignment was transported to Germany by air freight and was lost in a transhipment warehouse on the premises of Frankfurt Airport. The plaintiff claimed damages on the basis of German transport law and refused to settle the claim on the basis of the Montreal Convention.
The Bremen Local Court recently dismissed a compensation claim under the EU Flight Delay Compensation Regulation for a delayed flight booked using a company tariff. The court has thus put a double stop to possible claims by employees. If a booking is made using a company tariff, claims are generally excluded. Even if a booking is made using a general tariff, the travelling employee cannot bring forward a legal action.
Due to the COVID-19 crisis, all German airlines have had to significantly reduce their number of flights. In order to assist airlines, the government implemented a new law to mitigate the consequences of the COVID-19 pandemic in civil, insolvency and criminal procedures (the COVID-19 Act). The new law is also relevant for aircraft lessors that have leased aircraft to German airlines and fear that in case of an airline's insolvency, they may have difficulties repossessing their assets.
The impact of the coronavirus outbreak on the airline industry has been severe, with estimated losses of approximately $113 billion. The challenge for air carriers is how to handle a high volume of claims with a reduced workforce for an indefinite period. In that respect, the automation and digitisation of the claims handling processes can help airlines to handle more claims in less time and be flexible concerning their headcount and the volume of cases to be processed on a daily basis.
As of 28 December 2019, the limitations of liability in the Montreal Convention were adjusted. The last adjustment was made in 2009. Prior to that, the liability amounts had remained unchanged for 10 years. The new limits of liability apply to damaging events during air transport which were carried out after the amendments came into force.