MIAMI — European airline passengers affected by carriers that file for bankruptcy and cease flying will now have help getting to their final destination thanks to a new program from the International Air Transport Association (IATA).

The global airline trade organization has worked with its European members on a voluntary agreement that will cover the repatriation of passengers unable to return home due to an airline ceasing operations as a result of financial failure using what IATA Director General and CEO Tony Tyler calls “rescue fares.” The agreement formalizes a long-standing custom that many airlines have traditionally offered in these rare instances.

Tony Tyler (Credits: IATA)
Tony Tyler (Credits: IATA)

In a 2011 report,  European Commission estimated that between 2011 and 2020, only 0.07 percent of all passengers could be affected by airline bankruptcy, and of them, only 12 percent would need airline help to get home.  A permanent fund to help passengers stranded by airline bankruptcies has been discussed, but the airlines opposed it, saying it would subsidize riskier carriers and it would cost too much to set up the bureaucracy needed to run it.

If an airline goes bankrupt, IATA member airlines will help stranded passengers by giving them access to rescue fares to get home, when capacity is available.  The nominal amount fares can be bought for up to two weeks after a bankruptcy for those flying to, from or within Europe who does not already possess travel insurance that covers airline bankruptcies.

“This agreement on rescue fares shows that the airline industry is more determined than ever to ensure reliable and consistently excellent customer service. Airlines have formalized a unique cooperation agreement that puts passenger needs first,” said Tyler in a statement.