Case C-76/23—Reimbursement in travel vouchers: The provision “required signed | written agreement” of the passenger was obtained by filling out an online form on the operator’s website

In the recent ruling of 21 March 2024, in case C-76/23, the CJEU considers that the passenger gave his “written agreement” to the reimbursement of the ticket in the form of a travel voucher by filling out an online form on the website of the operating air carrier. However, despite stating that adding additional steps – an unfair procedure – is likely to make it more challenging to obtain a refund in the form of a sum of money, this elementary finding did not influence the decision.

1. Introduction

According to the EU Law (Flight Compensation Regulation (EC) 261/2004), passengers are entitled to compensation of €250, €400 or €600 if their flight is cancelled, depending on the distance of the flight. The compensation must be paid in one of the following ways: 1) in cash; 2) via electronic bank transfer; 3) through bank orders; 4) by bank checks, or 5) with the passenger’s signed agreement, through travel vouchers and/or other services [art. 7(3)].

The airline can choose any of the first four payment methods, including transferring the amount owed to a credit card or PayPal account. However, travel vouchers must be accepted voluntarily by the passenger in writing, ex-post and individually. Even in exceptional situations, such as the recent COVID-19 pandemic, passengers are not required to accept vouchers offered by airlines. Accepting vouchers ties the passenger to the specific airline and exposes them to the risk of insolvency and validity. Article 14 of the EU Law requires airlines to inform passengers of their rights so that they can effectively exercise them.

The Vienna District Court for Commercial Affairs (11.03.2021 – 7 C 12/21x) ruled that the passenger’s selection of a voucher on the airline’s booking portal satisfied the requirements for written consent within Article 7(3), and the District Court of Königs Wusterhausen (16.11.2021 – 4th C 1402/21, B) ruled that requesting a voucher by telephone does not meet the requirements.

2. The procedure for travel vouchers and other reimbursements 

The passenger booked a connecting flight with TAP Air Portugal, which was due to take place on July 1, 2020, from Fortaleza (Brazil) to Frankfurt am Main (Germany) via Lisbon for 1,447.02 euros, but the carrier cancelled the flight.

Since May 19, 2020, during the pandemic crisis, TAP began offering passengers a procedure for requesting reimbursements, including for flights cancelled by it, on the home page of its website.

Passengers could thus choose between an immediate reimbursement in the form of travel vouchers by filling out an online form and a refund in another form, for example, a sum of money or bank transfer, as long as they contacted their customer service department in advance to examine the facts.

The conditions of acceptance were only available in English, and the passenger had to accept them after providing the following information: ticket number, surname, email address, and telephone number. The information states that if they opted for a refund in the form of a travel voucher, refunding the ticket in cash would be precluded.

On June 4, 2020, the passenger opted for the travel voucher and received it by email, totalling 1,737.52 euros, corresponding to the initial ticket price, plus a supplement, which he transferred two months later to Cobult.

Cobult requested that TAP reimburse the price of the cancelled flight in cash within 14 days and, upon refusal, filed an action, which the court of first instance declared unfounded because the refund in the form of the travel voucher had extinguished the rights of the assigning passenger.

3. The question for a preliminary ruling

An appeal was lodged with the Regional Court of Frankfurt am Main. The court questioned the scope of the concept of “passenger’s written agreement” («mit schriftlichem Einverständnis”) contained in Art 7(3) to assess whether the reimbursement modalities imposed by the airline through its website comply with this provision. The requirement for a written agreement from the passenger may seem an additional requirement to protect the passenger against a premature and ill-considered option for a travel voucher, a modality the European legislator considered less favourable for the consumer.

However, from a second perspective, the fact that a written agreement is required from the passenger, in the form of consent transmitted by post or electronically, is likely to extend reimbursement deadlines while simultaneously increasing the burden associated with the administrative management of these refunds for air carriers. Therefore, according to the Landgericht Frankfurt am Main, an online reimbursement procedure in several stages, such as the one described in the main procedure, may be considered to comply with the requirements of Art 7(3).  The Landgericht Frankfurt am Main has suspended the proceedings and submitted the following question to the Court of Justice of the European Union (CJEU) for a preliminary ruling:

“Must Article 7(3) of [Regulation No 261/2004] be interpreted as meaning that a signed agreement of the passenger on the reimbursement of the cost of the ticket with a travel voucher within the meaning of the first indent of Article 8(1)(a) of [that regulation] exists where the passenger selects a voucher of this type on the website of the operating air carrier to the exclusion of a subsequent refund of the cost of the ticket in monetary form and receives it by email, while reimbursement of the cost of the ticket in monetary form is only possible after first contacting the operating air carrier?”.

According to the CJEU, the structure of Article 7(3) indicates that the ticket is primarily refunded in cash or electronic payments, while refunds in the form of travel vouchers are presented as a subsidiary type of refund, as they are subject to the additional requirement of a “written passenger agreement”.

Regulation 261/2004 does not define what should be understood as a written agreement in the articles or its twenty-two recitals. Unlike Directive 2015/2302, no recitals here provide essential support for interpretation.

According to the Luxembourg court, the concept of “agreement” is understood as free and informed consent according to its usual meaning. Therefore, Article 7(3) requires the passenger’s free and informed consent to obtain the ticket reimbursement through a travel voucher.

We find two possibilities in the different language versions: signed agreement or written agreement. The signed agreement of the passenger comes from the French, English, Italian, Latvian, Lithuanian, Maltese, Bulgarian, Spanish, Greek, Czech and Finnish languages. In contrast, the written agreement comes from the Danish, Portuguese, German, Estonian, Croatian, Hungarian, Dutch, Polish, Romanian, Slovak, Slovenian and Swedish languages. However, the wording used in one of the language versions of a European standard cannot serve as the sole basis for its interpretation nor have priority concerning other language versions, requiring that the provisions of Union law be interpreted and applied in a manner uniform, in the light of the versions written in all its languages.

Given the objective of ensuring a high level of protection for air passengers (recitals 1,2 and 4) and the duty of information incumbent upon the operating air carrier (recital 20), it is necessary to consider that the concept of “passenger’s written agreement” “it presupposes, firstly, that that passenger was able to make an effective and informed choice and, therefore, freely and informedly consent to the reimbursement of his ticket in the form of a travel voucher and not in the form of an amount in cash.”. Therefore, the passenger must be provided with clear and complete information about the different ways of refunding their ticket so that they can give their free and informed consent in the form of a travel voucher.

Therefore, concerning a passenger whose flight has been cancelled, there is a duty on the air carrier to provide him, loyally, with clear and complete information about the different methods of refunding his ticket by article 7(3). If this does not occur, it cannot be considered that conditions were met for an “effective and informed choice” that resulted in “free and informed consent to a reimbursement by a travel voucher”.

In this sense, it cannot be considered that according to the CJEU the “passenger cannot be deemed to have given his or her ‘agreement’ within the meaning of Article 7(3) of Regulation No 261/2004 where the operating air carrier presents, inter alia on its website, information relating to the procedure for reimbursement of the cost of a ticket in an ambiguous manner or in part or in a language in which the passenger cannot reasonably be expected to be proficient, or even in an unfair manner, in particular by making reimbursement of the cost of that ticket by a sum of money subject to a procedure containing steps supplementary to the procedure for reimbursement by a travel voucher.” (emphasis added).

This part of the ruling would be decisive in the present case in which passengers could easily opt for immediate reimbursement through travel vouchers by filling out an online form, precisely what best served the carrier’s interests during a severe treasury crisis due to the pandemic. However, they did not have the same digital facility for reimbursement in another form, e.g. for a sum of money. In this case, they would have to contact their customer service in advance so that the latter could examine the facts, given the severe crisis, experiencing long waiting periods, a single language available, and communication costs.

Now, no examination of the facts is necessary for refunding money other than that carried out to issue the voucher; the issue is the same: the company cancelled the flight. Long waiting times for telephone support, costs and non-response to emails are exhausting for consumers, inducing them to choose the most advantageous solution for the air carrier.

In short, by creating additional steps for the cash reimbursement that did not exist for issuing the voucher, there is cunning behaviour on the part of the airline, creating difficulties for the passengers and guiding them in a particular direction. This is precisely the opposite of the favourable treatment sought by the European legislator who, in the case of the voucher, because it is more unfavourable to the consumer than the amount of money, aims to protect their position. The CJEU states this in the following part: “That applies a fortiori since the addition of such supplementary steps is liable to render reimbursement by a sum of money more difficult to obtain, and thus to upset the relationship between the two means of reimbursement which the EU legislature, as is apparent from paragraph 20 above, has established. That would conflict with the objective pursued by Regulation No 261/2004 consisting in ensuring a high level of protection for air passengers.”

Regarding the signed agreement/written agreement dichotomy, the European judges considered pertinent the observations of the French government covering “express, definitive and unequivocal acceptance of the reimbursement of the cost of the ticket by a travel voucher, by the sending of a form filled in by that passenger on the website of the operating air carrier without that form including the handwritten or digital signature of that passenger.”

Strangely, the CJEU supports the argument that requiring the passenger’s signature would increase the burden linked to the administrative management of these airline refunds and would likely delay the refund process for the passenger consumer himself. All over the world, companies already have mechanisms whereby the consumer, instead of subscribing, safely enters a subscription code sent to their cell phone.

What seems controversial is to facilitate the travel voucher by a form completed by the consumer on the air carrier’s website (payment that the European legislator considers less favourable and, as such, requires particular caution) when the same possibility is not granted for a cash payment, bank transfer or check. The unfairness that the CJEU considered to exist when the “reimbursement of the cost of that ticket by a sum of money subject to a procedure containing steps supplementary to the procedure for reimbursement by a travel voucher” is verified in this case.

For the bank transfer method, in addition to the ticket number, surname, email address and telephone number that the company requested for the voucher, they must add a field for the IBAN. It made it easier for the travel voucher but worse for other modalities or reimbursement, requiring the passengers to contact their customer service in advance to examine the facts, with the inconveniences of long waiting times, costs, and a single language. This seems incompatible with the high level of consumer protection, a cornerstone of the Union.

However, the CJEU considered that there was nothing to point to the behaviour described considering “the passenger is deemed to have given his or her ‘signed agreement’ to reimbursement of the cost of the ticket by a travel voucher where he or she has filled in an online form on the website of that air carrier, by which he or she chose such a means of reimbursement to the exclusion of reimbursement by a sum of money, where that passenger has been able to make an effective and informed choice and, accordingly, to give informed consent to the reimbursement of the cost of his or her ticket by a travel voucher rather than by a sum of money, which presupposes that the air carrier has provided to that passenger, in a fair manner, clear and full information as to the various means of reimbursement available to him or her.”

For what CJEU (Third Chamber) ruled:

“Article 7(3) of Regulation (EC) No 261/2004 of the European Parliament and of the Council of 11 February 2004 establishing common rules on compensation and assistance to passengers in the event of denied boarding and of cancellation or long delay of flights, and repealing Regulation (EEC) No 295/ 91, read in conjunction with Article 8(1)(a) of that regulation and in the light of recital 20 of that regulation, must be interpreted as meaning that, in the event of cancellation of a flight by the operating air carrier, the passenger is deemed to have given his or her ‘signed agreement’ to reimbursement of the cost of the ticket by a travel voucher where he or she has filled in an online form on the website of that air carrier, by which he or she chose such a means of reimbursement to the exclusion of reimbursement by a sum of money, where that passenger has been able to make an effective and informed choice and, accordingly, to give informed consent to the reimbursement of the cost of his or her ticket by a travel voucher rather than by a sum of money, which presupposes that that air carrier has provided to that passenger, in a fair manner, clear and full information as to the various means of reimbursement available to him or her.”.

Carlos Torres | ESHTE