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Law 14.034/2020 sanctioned, providing for emergency measures for Brazilian civil aviation

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07 de agosto de 2020

Law 14.034/2020 sanctioned, providing for emergency measures for Brazilian civil aviation

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On 8/6, Law 14,034 / 2020, which provides for emergency measures to assist the Brazilian civil aviation sector due to the COVID-19 pandemic, was published on the Official Gazette.

The Law’s starting point was the Provisional Measure 925/2020, issued in March of this year, which allowed airlines to extend to 12 months the deadline for refunding passengers whose flights were canceled due to the pandemic.

The initiative sought to give respite to companies in a moment of sudden drop in demand and when airport authorities around the world imposed restrictions on commercial flights, causing mass cancellations.

Changes

Provisions added during the process of converting the Provisional Measure 925/2020 into law in the Brazilian Congress not only contribute to reduce the impacts of the crisis, but also provide for more structural changes in the sector, allowing the improvement of the business environment in the airline sector.

Respite. The fixed and variable contributions due in 2020 provided for in airport concession contracts may be paid until 12/18 this year, with monetary restatement calculated based on the National Consumer Price Index - INPC (inflation adjustment).

Contractual liability of suppliers. Indemnities for moral damages resulting from flight delays and cancellations, or delays in the delivery of luggage or cargo, are conditioned upon the effective demonstration of the occurrence and extent of damage by the users of the service.

In addition, in the event of damage resulting from air transport of passengers, carriers cannot be held responsible if it is proved that measures have not been taken to prevent damage due to Acts of God or force majeure circumstances.

The law indicates as Acts of God or force majeure restrictions on landing or takeoff resulting from adverse weather conditions or by a declaration of a pandemic, among others.

Refund and credit. Refunds of tickets for flight cancellations between 3/19/2020 and 12/31/2020 may be made within twelve months, counted from the date of the canceled flight, in updated amounts based on the INPC (National Consumer Price Index).

In replacement for refunding, companies may offer consumers the option of receiving credit of a value greater than or equal to that of their ticket, to be used by consumers themselves or by third parties to purchase products or services offered by the company within 18 months from the date of the cancelled flight.

Consumers' right to refund, credit, accommodation or flight rescheduling does not depend on the payment method for the ticket purchase (credit, miles, etc).

FNAC. Resources from the National Civil Aviation Fund (FNAC) may be the subject to and guarantee of a loan, to be signed by 12/31/2020, for provision to airport concession holders or to regular air transportation services concessions and to air transport auxiliary service providers, on the condition that they prove to have suffered damage as a result of the COVID-19 pandemic.

International Boarding Charge. The new law extinguishes the US$ 18 International Boarding Charge (TEI), which was in force since 2021. The measure will reduce international airfares, favoring passengers and the low cost airline market.

 

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