BA settlement small, but significant

LONDON, Feb. 12 (UPI) -- A recent settlement in Britain may have opened the floodgates for airlines compensating passengers for canceled flights, an industry expert said.

After months of negotiations, British Airways agreed to pay 21 passengers an average of $550 each for canceling their flights, The Times of London reported Thursday.

The settlement is the a first for British passengers, The Times said. But, it may not be the last.

"This could open the Pandora's box for retrospective pay-outs and an ongoing loss of revenue that BA wasn't banking on," said Peter Morris, chief economist at Ascend, an aviation consulting firm.

"In terms of the scale of the potential impact, it is very significant," he said.

A deciding factor in the recent settlement was a European Court of Justice ruling that granted passengers compensation for flights canceled due to technical problems.

European Union law also mandates passengers be given alternate travel arrangements or be compensated unless flights are canceled under "extraordinary circumstances," The Times said.

"We hope that airlines will now step up to their responsibility under the legislation and understand that passengers will not simply roll over and let their basic legal rights be ignored," said associate solicitor Mike Rattenbury at Lavelle Coleman.