The EU wants to overhaul passenger rights. After years under review, revised legislation has entered its final phase for approval.
Following two months of conciliation talks, a joint text published on June 15 will now be voted on by the European Council and Parliament.
While some proposed changes are positive, the legislation could prove problematic for airlines and passengers alike.
What are the key proposed changes?
The joint text contains 148 pages’ worth of amendments to existing regulations. The most noteworthy changes are as follows:
- Airlines, OTAs, and search portals must display prices inclusive of hand baggage by default. Passengers may still opt for a cheaper fare which excludes hand baggage.
- Anyone accompanying a child under 14 must be offered an adjacent seat at no extra cost.
- Passengers cannot be charged for correcting spelling errors in their name or printing a boarding pass after check-in.
- Airlines must provide clear instructions on how to submit a compensation claim within four days of a completed journey (if the passenger may be eligible for compensation).
What does this mean for the industry?
The proposed changes are mostly negative for airlines and mixed at best for passengers.
Ancillary revenue
Airlines that currently offer unbundled hand baggage (notably low-cost airlines and the Lufthansa Group since May 2026) will need to adapt how fares are presented in the booking flow.
Considering that EU rules normally prevent businesses from defaulting customers into paying for extra services, this approach seems rather counter-intuitive and risks confusing passengers who don’t realize cheaper fares without hand baggage are still available.
Airlines offering unbundled hand baggage may see two opposing effects: fewer customers entering the booking funnel if they miss that cheaper fares are available, but potentially higher attach rates for hand baggage among those who do.
Most airlines already seat at least one parent next to children without a fee so the impact on seat selection revenue should be relatively limited. Ryanair is perhaps the one exception in currently charging a “Mandatory Family Seat” fee of €4.50-€13.50.
Disruption expenses
Requiring all airlines to proactively communicate how to claim compensation will likely push claim rates up, increasing disruption costs that will ultimately be passed on through higher fares.
What's not changing is the value of compensation for disrupted flights which will remain at least €250 for short-haul flights (even if the ticket cost €20).
A silver lining for airlines is that liability for accommodation during disruption will be capped at three nights. Previously the liability was unlimited.
What happens next?
The joint text goes for a “third reading” by the European Council and European Parliament. In order to pass the legislation, the Council needs a qualified majority while the Parliament needs an absolute majority.
Both bodies must vote in favour by the end of July for the legislation to be adopted (with the possibility for a two week extension).
If either body rejects the proposed text, the changes will not be adopted and the legislative process ends.
