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Vouchers No Substitute for Reimbursement, EU Says

A new ruling by the European Commission may affect a parliamentary bill drafted in Iceland in April, which would allow travel companies in Iceland to offer vouchers to clients whose trips were cancelled due to coronavirus. The European Commission ruled that Danish travel companies are not allowed to offer clients vouchers as an alternative to monetary reimbursement for trips cancelled due to coronavirus, RÚV reports.

EU says “No”

As noted in an article published yesterday on DR (Danish Broadcasting Corporation), the Danish parliament has discussed the possibility of allowing travel companies to offer vouchers – which would be valid for 12 or 18 months – to those clients whose trips were cancelled due to coronavirus. If clients did not use the vouchers during the time that they were valid, they would be offered monetary reimbursement. The proposal was intended to combat the liquidity crisis of travel companies during the pandemic.

The Danish parliament submitted the proposal to the European Parliament for consideration. In a press release yesterday, the EU briefly outlined the European Commission’s opposition to the proposal: “Carriers and travel companies can offer vouchers for journeys and holidays cancelled due to coronavirus. However, this offer cannot affect passengers’ and travellers’ right to opt for reimbursement instead, the European Commission has explained.”

The conclusion is predicated on the EU’s four passenger-rights regulations (regulations 261/2004, 1371/2007, 1177/2010 and 181/2011), which endow passengers with a full set of rights, whether they travel by air, rail, ship, bus, or coach.

The ruling will have interpretational value on proposed legislation in Iceland.

Proposal met with harsh criticism

In April, Minister of Tourism, Industry, and Innovation, Þórdís Kolbrún Reykfjörð Gylfadóttir, submitted a parliamentary bill that would allow travel companies to offer vouchers to those clients whose trips were cancelled due to coronavirus. The bill formed a part of the government’s action plan against the economic effects of COVID-19.

The bill met with harsh criticism. The Consumer Association of Iceland came out against the proposal, arguing that it was unacceptable to ask consumers to solve the liquidity crisis of travel companies. Supreme court attorney Vilhjálmur Þ. Á. Vilhjálmsson has stated that the bill violates Article 72 of the constitution, regarding the right of private ownership.

In an interview with Fréttablaðið today, Breki Karlsson, Director of the Consumer Association of Iceland, has stated that the EU’s ruling “must be the final nail in the coffin” of the Minister of Tourism’s bill.

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