European Union governments gave their final approval today to legislation giving airline passengers more rights to compensation when hit by delays, canceled flights or overbooking.
The move by EU foreign ministers means that the new passenger rights will come into effect in 2005 across the 15 nation bloc and the 10 members that join May 1st.
The European Parliament gave its permission in December.
The law will force all airlines including charter airlines for the first time flying to and from EU airports to pay 600 euros to passengers bumped off long-haul flights, 400 euros for medium-length trips and 250 euros for short hops. The current maximum is 300 euros.
Compensation payments will also apply to passengers whose flights are canceled because of too few tickets sold or for other commercial reasons, although not those hit by bad weather, technical problems or strikes.
Another situation that would fall under "circumstances outside one's control" would be "a credible risk of terrorism," said European Commission spokesman Mr Gilles Gantelet.
"I'm sure most passengers will understand that this (cancellation) was not done just to upset them or for commercial reasons but rather to protect them from a possible fatal attack," he said.
In case of disputes, Mr Gantelet said passengers would have to take an airline to national courts to decide whether a cancellation was exempt or not.
Delays of at least two hours for whatever reason would also trigger automatic compensation, such as free meals and phone calls.
If a flight is at least five hours late, a passenger must be offered either a refund of the full ticket price if the flight no longer serves any purpose such as getting somewhere in time for a meeting or rebooking onto the earliest flight home.
Airlines will automatically have to offer a free hotel room for passengers delayed overnight.
European airlines were reluctant at first to endorse the new rights, especially budget carriers that fear the increased compensation could force up their ticket prices which, in many cases, are lower than the compensation levels.
EU officials however, argue the new rules would increase pressure on airlines to limit the practice of overbooking selling more tickets than seats available as well as to improve on-time service.
An estimated 250,000 European passengers fall victim to overbooking each year, EU officials have said.