WASHINGTON, D.C- In a significant policy shift, the Trump administration has officially withdrawn a proposed rule that would have required airlines to compensate passengers with cash for major flight disruptions.
The U.S. Department of Transportation (USDOT) announced on September 4, 2025, that it would not move forward with the plan introduced during the final weeks of President Joe Biden’s tenure.
The proposed rule aimed to mandate compensation ranging from $200 to $775 for delays or cancellations caused by issues within the airline’s control, along with provisions for meals, lodging, and transport. The decision to rescind the rule aligns with the Trump administration’s broader deregulatory agenda.
Photo: CanvaUS Withdraws Flight Disruption Compensation
The original proposal, introduced in 2023, sought to enhance consumer protections by requiring airlines to compensate passengers for significant delays and cancellations caused by the airlines themselves.
Under the plan, compensation would have ranged from $200 for delays of three to six hours to $775 for delays exceeding nine hours. Additionally, airlines would have been obligated to provide meals, lodging, and rebooking options for affected travelers.
The rule aimed to align U.S. policies with European standards on passenger rights, where similar compensation requirements have been in place for years.
Supporters argued that the regulation would have marked a significant step toward meaningful passenger protection, especially amid rising flight disruptions.
Photo: Aero Icarus | FlickrIndustry Reaction and Criticism
The airline industry strongly opposed the proposed rule, citing concerns over increased operational costs and potential ticket price hikes.
Airlines for America, a trade group representing major U.S. carriers, argued that the regulation would lead to higher costs and reduced options for consumers.
Critics contended that such regulations could increase operational costs and raise ticket prices, though costs have risen regardless.
On the other hand, consumer advocates expressed disappointment over the withdrawal, emphasizing the need for stronger protections for passengers.
Transportation Secretary Pete Buttigieg criticized the decision, highlighting ties between Trump’s DOT appointee and past airline lobbying efforts.
Düsseldorf Airport. Photo- Andreas | FlickrExisting Passenger Rights
Despite the rescinded rule, passengers retain certain rights when flights are delayed or canceled. The “automatic refund rule” entitles customers to refunds for canceled flights, significant baggage delays, or paid services not delivered.
Major U.S. airlines, including American Airlines (AA), Delta Air Lines (DL), United Airlines (UA), Southwest Airlines (WN), and JetBlue Airways (B6), voluntarily offer some customer concessions, such as rebooking disrupted flights and providing meal vouchers if the delay is the airline’s fault.
However, these voluntary measures vary among carriers and do not guarantee compensation for all disruptions. Consumer advocates warn that more deregulation efforts under the Trump administration could further reduce protections, targeting rules on automatic refunds, fee disclosures, and disability accommodations.
Photo: L.A FLIGHTS | YouTube ChannelBottom Line
As quoted in Reuters, the White House claimed that the withdrawal was “consistent with Department and administration priorities,” emphasizing the administration’s commitment to reducing regulations perceived as burdensome to businesses.
The move has sparked a renewed debate over the balance between consumer protection and industry regulation in the U.S. aviation sector.
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