On July 4, 2012, the Federal Cabinet passed a draft law on arbitration in air traffic. The aim of this law, which supplements the Air Traffic Act, is to introduce an arbitration board for air passengers. This should make it possible for air passengers to settle their claims for overbooking, cancellation and delay of flights as well as baggage damage out of court in future. Until now, these claims have been asserted in court in the form of payment claims for reimbursement of the flight price, lump-sum compensation or damages. The civil courts were always responsible for this.
In future, these claims are to be settled in an out-of-court dispute resolution procedure. The arbitration should cover payment claims of a consumer up to 5,000 euros. Claims exceeding this amount may be subject to arbitration if the rules of procedure so provide.
According to the German government’s explanatory memorandum, the introduction of the arbitration board represents a fast and cost-effective procedure for fulfilling justified consumer claims. For the airlines, it should enable customer loyalty and ultimately also relieve the burden on the courts. Air carriers can introduce institutions organized under private law as arbitration boards. If companies do not participate in an arbitration procedure of a recognized arbitration body organized under private law, official arbitration will be introduced.
