Laura Pierallini Gianluigi Ascenzi June 9 2010 Airlines likely to oppose mutual indemnity fund for passengers Studio Pierallini | Aviation - Italy Laura Pierallini, Gianluigi Ascenzi Aviation An Italian consumer association has asked ENAC, the Italian Civil Aviation Authority, to consider a method of indemnifying air travellers promptly for the consequences of service problems (eg, delays, flight cancellations, overbooking, lost luggage or delayed redelivery). The association advocates the creation of a bilateral mutual fund in order to provide timely compensation for any such problems caused by air carriers or handling companies. However, the adoption of such a scheme has been complicated by the introduction in some airports of expensive security scanners (for further details please see "ENAC trials full-body scanners in Rome and Milan"). Consumer bodies are considering whether it would be more appropriate to spend money on indemnifying travellers for the consequences of service disruptions, rather than investing further in security systems. The association has also asked the government to grant ENAC the power to impose direct penalties, as well as fines of up to €1,000 for missing items of luggage. The fines would be added to the fund, along with a contribution of €0.50 a flight by handling companies and airlines. Creating such a fund will not help carriers or handling companies, and could even be damaging. The Italian courts have already shown their increasing willingness to grant compensation to passengers in the event of service problems. Given the obvious benefits for passengers of avoiding the time and expense of obtaining a court judgment, airlines often agree to settle claims arising from or related to such problems before trial. Carriers also face a heavy burden of proof in such cases and must adduce clear evidence of force majeure in order to avoid a judgment against them. The creation of the compensation fund would be a useless charge for air carriers, which would be likely to pass on the cost by raising air fares, to the direct detriment of most passengers.For further information on this topic please contact Laura Pierallini or Gianluigi Ascenzi at Studio Legale Pierallini e Associati by telephone (+39 06 88 41 713), fax (+39 06 88 40 249) or email ([email protected] or [email protected]).