People line up before entering the security zone at Pearson International Airport in Toronto on Friday, Aug. 5, 2022.Nathan Denette/The Canadian Press
The Supreme Court of Canada unanimously dismissed an appeal by domestic and global airlines in a landmark decision that upholds the country’s Air Passenger Protection Regulations, or APPR, as it applies to international flights.
The industry, led by International Air Transport Association, had challenged the regulations, arguing they were incompatible with the Montreal Convention, which governs international air travel.
At issue was the fact that the multilateral treaty requires mistreated passengers to provide proof of the extent of any damages suffered, while the APPR, which came into force in 2019, establishes a duty by airlines to provide standardized compensation to consumers for issues such as flight disruptions in certain cases.
In its judgment, issued on Friday, the country’s top court found the federal regulations do not conflict with the treaty, a decision that means passengers will continue to be able to claim compensation as set out in the current rules for flights to and from Canada. The ruling did not concern domestic flights, which are also subject to the APPR.
“The Supreme Court modernizes consumer protection in Canada,” said John Lawford, general counsel of the Public Interest Advocacy Centre, a consumer rights group that intervened in the case.
“They’ve acknowledged the importance of these types of compensation schemes for consumers,” he added, referring to how the APPR makes it easier for air passengers to claim compensation.
The regulations mandate that airlines provide standardized compensation to passengers for lengthy flight delays, cancellations and denial of boarding in cases where the disruption is deemed to be within the carriers’ control and not required for safety. The amounts can reach $2,400 for significant disruptions.
The regulations also establish parameters on compensation and refunds for lost or damaged luggage, as well as on airlines’ duty to accommodate passengers on alternative flights, among other obligations.
The Supreme Court ruled that the APPR can co-exist with the Montreal Convention because the federal rules aren’t about individualized compensation and instead establish standards of treatment for all passengers in certain situations.
The judgment follows a 2022 ruling by the Federal Court of Appeal that had largely upheld the regulations.
The International Air Transport Association, or IATA, which represents more than 300 airlines, argued before the Supreme Court that the regulations shouldn’t apply to foreign airlines and that they mandate compensation that can exceed consumers’ actual losses.
IATA spokesperson Markus Ruediger said via e-mail that the organization was “disappointed” by the Supreme Court’s decision.
“Protecting the interests of passengers is best achieved through a safe, efficient journey where disruptions are minimized. While airlines play a critical role in this, the federal government needs to focus its efforts on improving the overall air travel system, especially in the parts of the value chain which are directly under its control,” Mr. Ruediger also said.
Ottawa, for its part, celebrated the judgment.
“In 2019, our Government was the first in Canada’s history to protect passengers by introducing legislation. Today, the Supreme Court ruled in favour of passengers and our view that passengers need protection,” Transport Minister Anita Anand said in a statement.
But consumer advocates say that, while the ruling is a clear win for consumers, the APPR remain deeply flawed regulations in need of reform.
Passengers claiming compensation under the AAPR must submit their complaints directly to the airlines before asking that their case be assessed by the Canadian Transportation Agency (CTA), a quasi-judicial tribunal and regulator that handles disputes between airlines and customers. They can also pursue their claim in court.
Despite new measures introduced last year to streamline the CTA’s complaints process, the system remains difficult for consumers to navigate, mired in delays and opaque, some passenger advocates say.
Gabor Lukacs, president of consumer advocacy group Air Passenger Rights and an intervenor in the case, said the Supreme Court’s judgment represents an opportunity for the federal government to take another stab at fixing the regulations.
“The court’s decision breathes new life into the initiative to revamp the APPR and correct its many shortcomings,” he said in a statement.