Paxboy said:
Cynical view mode
The old guard of European airlines wanted to force RyanAir to have the same problems as them and got their pals in the EC hierarchy to pass this weird legislation. They must be very pleased.
That actually wasn't how it happened. 261/2004 was not the first regulation. It was adopted in 2004 to replace the previous one (i've now forgotten it's number) which covered only denied boarding.
The LCC and charter carriers, at the time, had no interest in this older regulation because their business model didn't/doesn't call for overbooking. Originally the Commission and the Parliament wanted to ban oversales, but the network airlines convinced them that the airline's practice actually provided significant benefits (in that passengers could make bookings on otherwise 'full' flights) and that the airlines got it right much more often than they got it wrong.
So the rule was that if you bumped somebody, you rebooked them (or gave them a refund) on the next flight and, if necessary, you fed them and put them up in a hotel if they had to overnight. You also 'compensated' them with money.
When they adapted the old regulation they kept all of these provisions (why reinvent the rule) but extended them to cancellations and long delays. To discourage 'commercial' cancellations they kept the compensation, but waived it for delays and for other cancellations. At that time nobody considered that hotels might ever be required indefinitely or more than one night.
Cryanair, and Sleezy to a lessor extent, normally apply the Regulation by telling the punter
off - you sort it out". For that small percentage of passengers that keep their receipts and claim they usually settle.
But then the old guard will insist that you cannot circumvent the law by signing away your rights. They had to find a way to hurt hi financially. Of course, MoLs in a much better financial state than most of them!
Actually this prohibition is already in the Regulation. Even if they sign a waiver, the regulation still applies. So if anyone has signed such a waiver, you can still claim.