Airlines bankruptcies: Ectaa demands protection for travelers!

Airlines bankruptcies: Ectaa demands protection for travelers!

The bankruptcy of Air Belgium has renewed debate about the need for legal bankruptcy protection for airlines in Europe. Ectaa, the European travel agents and tour operators association, highlights the urgent need for regulation. On September 18, 2023, Air Belgium announced the suspension of all scheduled flights in order to concentrate more on the cargo and leasing business. The company was ultimately declared insolvent on April 30, 2025, wreaking havoc on thousands of affected customers awaiting refunds for canceled flights.

The outstanding refund claims amount to around eight million euros, with over 5 million euros being due for tickets sold through travel agencies and organizers alone. Small and medium-sized travel companies, which make up 98 percent of travel agents in Europe, are particularly hard hit by this situation. Ectaa President Frank Oostdam emphasizes that in the event of airline insolvency, organizers often have to make replacement offers at their own expense without any prospect of repayment. These conditions create a precarious situation for both consumers and intermediaries, who in many cases have to pay for airline tickets in full months in advance.

Urgency of bankruptcy protection

According to Ectaa, there have been around 1,200 passenger airline bankruptcies worldwide over the past 25 years. In response, the association is calling for financial guarantees for airlines in the event of bankruptcy. This is seen as a political opportunity to reform the Air Passenger Rights Regulation (Regulation 261/2004). A proposal from Ectaa aims to introduce a model similar to the Danish airline ticket guarantee fund, in which all airlines should participate. The long-term demand for mandatory insolvency protection is further strengthened by the incidents surrounding Air Belgium, while the German Travel Association (DRV) is rather cautious on this issue.

In addition to Ectaa's demands, eu travel tech and consumer and insurance organizations have also written an open letter to the European Commission. The letter calls for the introduction of an obligation for airlines to provide financial guarantees for passenger liabilities in the event of bankruptcy. Responsibility for these risks should lie with airlines, not consumers, taxpayers or blanket guarantee providers. The rise in airline bankruptcies in recent years, compounded by the financial impact of the COVID-19 crisis, raises serious questions about passenger safety.

Suggestions and responsibility

A European Commission study reported that between 2011 and 2019, a total of 87 airlines filed for bankruptcy, directly affecting 5.6 million consumers. The co-signatories of the letter advocate for a mandatory insolvency protection regime to adequately protect all affected parties. Alternative measures, such as promoting travel insurance or mandating national authorities for returns, are seen as unfair to consumers and taxpayers.

Eric Drésin, Secretary General of ECTAA, highlights that travel agencies and tour operators have long been advocating for insolvency protection obligations for airlines. The Package Travel Directive (PTD) could serve as a potential model for such obligations, with the Danish Guarantee Fund mentioned as an example. Emmanuel Mounier, Secretary General of eu travel tech, emphasizes that stronger licensing oversight for EU airlines should be a complementary measure to mandatory insolvency protection, but not a replacement.

The actual situation shows that the urgency of uniform insolvency protection for airlines is overdue in order to sustainably protect consumers and the travel industry.