Economic Regulations on Boarding Priority and Compensation for Denied Boarding, Delayed and Cancelled Flights

May 14, 2012

CIVIL AERONAUTICS BOARD

ECONOMIC REGULATION NO. 7, AS AMENDED (ER-7) BOARDING PRIORITY AND COMPENSATION FOR DENIED BOARDING, DELAYED AND CANCELLED FLIGHTS

CHAPTER I

General Provisions

SECTION 1. Title of Regulation. — This Regulation shall be known and cited as Economic Regulations on Boarding Priority and Compensation for Denied Boarding, Delayed and Cancelled Flights.

SECTION 2. Definition. — For the purpose of this Regulation:

(a) "Air Carrier" means a Philippine or foreign air carrier as defined under Republic Act No. 776, which operates scheduled domestic or international flights originating from or terminating at, or serving, a point within the Philippines.

(b) "Cancellation" is the act of calling off a flight with the uncertainty of knowing when such flight will happen.

(c) "Conditional Reservation Ticket" means a ticket sold by a domestic or foreign carrier on the basis of a tentative listing on a specific flight, on a specific date, and a class of service and for which space is conditionally reserved.

(d) "Confirmed Reserved Space" means space on a specific date and on a specific flight and class of service of a carrier which has been requested by a passenger and which the carrier or this agent has verified, by appropriate notation on the ticket, as being reserved for the accommodation of destination. AHCaED

(e) "Delay" is the act of deferring a flight to a later time.

(f) "Fare" is payment in consideration for the carriage of a passenger.

(g) "Regular Fare" is any fare that is offered on a regular basis and does not qualify as promotional or special fare such as free tickets provided by airlines to passengers, tickets available for free to employees, and tickets claimed based on mileage.

(h) "Promotional Fare" is any fare other than regular fare; it is a low, special, excursion, or apex (advance purchase excursion fare) fare which has more fences or restrictions than a regular fare.

(i) "Scheduled Domestic Carrier" refers to a Philippine carrier granted a Certificate of Public and Convenience and Necessity (CPCN) to operate scheduled or regular services within points in the Philippines or to and from the territory of the Philippines.

(j) "Scheduled Foreign Carrier" refers to an air carrier who is not a citizen of the Philippines, and/or an air carrier other than a domestic carrier.

(k) "Stop-over" means a deliberate interruption of a journey by the passenger, agreed to in advance by the carrier, at a point between the place of departure and the place of destination.

(l) "Value of the first remaining flight coupon" means the applicable one-way fare, including any surcharge, less any applicable discount on the sector where boarding is denied.

SECTION 3. Scope. — This Regulation shall apply to:

(a) flights or portion of flights within the territory of the Philippines;

(b) flights or portion of flights from the territory of the Philippines operated by a domestic or foreign carrier as defined in Section 2;

(c) denied boarding for reasons other than those set forth in Section 6 of this Regulation; CIScaA

(d) delayed flights; and

(e) cancelled flights.

CHAPTER II

Priority Rules

SECTION 4. Priority Rules. — For the purpose of determining which passengers holding confirmed reserved space shall be denied boarding on an oversold flight, every carrier shall observe the following priorities:

(a) Thru Passengers Over Originating Passengers — Whenever a flight is scheduled via an intermediate station, thru passengers on board said flight shall have first priority at said intermediate station.

(b) Connecting Confirmed Passengers — Connecting confirmed passengers excluding stop-over passengers at any station shall have second priority at the connecting intermediate stations.

(c) Originating Confirmed Passengers — Originating confirmed passengers at any station shall have third priority.

(d) Passengers with Conditional Reservation Tickets — Passengers holding conditional reservation tickets shall have fourth priority.

(e) Chance Passengers — Chance passengers shall be accommodated on a "first come, first served" basis.

CHAPTER III

Compensation for Denied Boarding and Cancellation

SECTION 5. Procedure for Denied Boarding. —

(a) If carrier intends to deny a passenger or passengers from boarding it should first call the attention of passengers who would voluntarily surrender their confirmed reserved spaces in favor of other passengers; CEIHcT

(b) Passenger or passengers who surrendered their confirmed reserved spaces should be offered by the air carrier benefits in exchange for the same; and

(c) In case where the number of passengers who volunteered to give up their seats is insufficient, the carrier may then deny passengers from boarding in accordance with Chapter II, and in which case it must compensate the passenger who was denied boarding.

No passenger shall be denied from boarding for two (2) consecutive times, on the same day except in circumstances set forth in Section 10 of this regulation.

SECTION 6. Cancellation. — In the event of cancellation, the carrier shall provide passengers with the written or published statement of the cause of the same.

This section shall not apply to no show or cancellations of booking voluntarily made by passengers.

SECTION 7. Amount of Compensation for Denied Boarding. — Subject to the exceptions under Section 10 hereinafter provided, carriers shall pay to passengers holding confirmed reserved space and who have presented themselves for carriage at the proper time and place and fully complied with the carrier's check-in and reconfirmation procedures and who are acceptable for carriage under the carrier's tariff, who have been denied boarding for lack of space, a compensation at the rate of:

(a) For passengers for domestic flights — 100% of the value of the sector not flown, plus an amount Three thousand pesos (Php3,000.00), and

(b) For passengers for international flights — 100% of the value of the sector not flown, plus an amount of Five thousand pesos (Php5,000.00) or its equivalent in other currency.

(c) In case the airline provides for higher compensation, the same shall prevail. CHATEa

If accepted by the passenger, the compensation shall constitute liquidated damages for all damages incurred by the passenger as a result of the carrier's failure to provide the passenger with confirmed reserved space.

The passenger shall, in addition to the damages, have priority booking for the next available flight using the same ticket for which he was denied boarding.

This provision shall also apply to passengers holding promotional fares.

SECTION 8. Rights of Passengers in Case of Cancellation. — In case of cancellation for causes attributable to the carrier, the passenger shall have the following rights:

a) The air carrier shall provide the following:

a.1. Refreshments of meals; (breakfast, lunch, or dinner as the case may be)

a.2. Hotel accommodation; (conveniently accessible hotel from the airport)

a.3. Transportation from the airport to the hotel;

a.4. Free communication such as phone calls, text or e-mails; and

a.5. First aid medicine, if necessary.

b) In case the passenger opts not to fly the ticket, reimbursement of the value of any fare, including taxes, surcharges, of the sector cancelled; and if both sectors are cancelled, the carrier shall reimburse the total value of the fare, taxes and surcharges.

For reasons other than fortuitous event, the carrier shall comply with the requirements of Resolution 155 (2001) Rules and Procedures Concerning Flight Schedules and Changes in Flight Schedules of Domestic Air Carriers; and submit a sworn statement to the Board from the concerned technical personnel of the carrier setting forth the reasons for the cancellation is ^* attributable to the latter. STcHEI

SECTION 9. Rights of Passengers in Case of Delay. — In case of delay, passengers shall have the following rights:

a) Delay for more than two (2) hours — the air carrier shall provide the following:

a.1. Refreshments or meals (depending on the time of the flight); (breakfast, lunch, or dinner as the case may be);

a.2. Free communication such as phone calls, text or e-mails; and

a.3. First Aid medicine, if necessary.

b) Flight deferred until the next day — the air carrier shall provide the following:

b.1. Refreshments and meals (depending on the time of flight); (breakfast, lunch, or dinner as the case may be),

b.2. Hotel accommodation; (conveniently accessible hotel from/to the airport),

b.3. Free communication such as phone calls, text or emails,

b.4. If passenger opts not to fly the remaining sector, reimbursement of the value of any fare, including surcharges, of the remaining sector not flown.

The carrier shall likewise comply with the requirements of Resolution No. 155 (2001), and submit a Sworn Statement to the Board from the concerned technical personnel of the carrier setting forth the reasons for the delay.

SECTION 10. Exceptions to Eligibility, Denied Boarding Compensation. — The carrier shall be exempt from liability to pay denied boarding compensation under the following instances: aCIHcD

(a) The flight for which the passenger holds confirmed reserved space is unable to accommodate him because of (1) government requisition of space; (2) substitute of equipment of lesser capacity when required by operational, safety and/or security reasons, and other causes beyond the control of the carrier; subject to the requirements set forth in the last paragraph of Sec. 8 and Board Resolution 155 (2001).

(b) The carrier arranges for comparable air transportation, or for other transportation accepted (i.e., used) by the passenger, which at the time either of such arrangements is made, is scheduled to arrive at the place of the passenger's next stop-over (or, if none, at the place of his destination) not later than three (3) hours in the case of domestic flights or not later than four (4) hours in the case of international flights, from the scheduled time of arrival of the flight on which he was denied boarding or accommodation; and 

The carrier shall be exempt from liability for delay and cancellation under the following instances:

(a) The flight is cancelled or delayed due to operational, safety and/or security reasons, force majeure, weather, strikes, or other causes beyond the control of the air carrier;

(b) fault is attributable to passenger.

SECTION 11. Written Explanation and Tender of Payment. — The carrier shall:

(a) furnish passengers, in cases of denied boarding, cancellation and delay, a written or published statement setting forth the circumstances of denied boarding, cancellation, and delay as herein provided in any manner practicable;

(b) tender to each such passenger who is eligible to claim the abovementioned benefits on the day and place the denied boarding, cancellation, or delay occurs, or at any branch or at the main office of the carrier, at the discretion of the passenger, a check for the amount specified or cash in case of denied boarding, and the document necessary to claim the benefits mentioned in cases of cancellation and delays; and

(c) if denied boarding compensation is accepted by the passenger, the same shall relieve the carrier from any liability for all claims for damages arising from the abovementioned acts. EDSHcT

CHAPTER IV

Written Reports

SECTION 12. Written Report on Denied Boarding, Cancellation and Delay. — Carriers shall file with the Board a monthly report on the name and addresses of revenue passengers who have been denied boarding, or whose flights were delayed or had been cancelled under the following categories:

(a) Denied boarding for lack of space on a flight otherwise normally operated.

(b) Denied boarding due to lack of space resulting from equipment substitution to smaller aircraft;

(c) Denied boarding compensation due to other exceptions under Section 10 of this regulation. Carriers shall attach to the said report a true copy of the manifest in which the name for each confirmed passenger who has been denied boarding appears;

(d) Cancellation of flights in accordance with the procedure set forth in Board Resolution No. 155 (2001);

(e) Delayed flights for more than two (2) hours; and

(f) Delayed flights resulting to deferment on the following day.

CHAPTER V

Conditional Reservations

SECTION 13. Sale of Conditional Reservation Tickets. — Scheduled air carriers may sell conditional reservation tickets on fully book flights where the passenger seeks reservation on that flight and where space due to no shows can still be reserved subject to the actual availability thereof, provided, that the passenger shall be informed of the nature and condition of the ticket reservation mode.

APPROVED, May 14, 2012. IcDHaT

 

MANUEL A. ROXASChairman

 

(SGD.) HON. JOSE PERPETUO M. LOTILLAUndersecretary for Legal Services Sector

 

(SGD.) HON. DANIEL G. CORPUZUndersecretary for Tourism, Planning

 

(SGD.) DIR. GEN. RAMON S. GUTIERREZCivil Aviation Authority of the Philippines

ATTESTED:

 

(SGD.) CARMELO L. ARCILLAExecutive Director

 

Published in The Philippine Star on May 21, 2012.