In a significant blow to travelers and the European aviation industry, Air Belgium, a charter and cargo airline, was declared bankrupt on April 30, 2025, leaving thousands of passengers unlikely to receive refunds for cancelled flights.
The airline’s collapse underscores mounting concerns over the financial fragility of smaller carriers and the inadequacy of current passenger protection mechanisms, as highlighted by the European Travel Agents’ and Tour Operators’ Association (ECTAA).
Contrary to what its name might suggest, Air Belgium is not the national flag carrier—that title belongs to Brussels Airlines. Founded with the intent to connect Belgium with Asian markets, particularly China, Air Belgium operated a mix of passenger charter flights and cargo services. The onset of the COVID-19 pandemic, which severely disrupted global travel and trade, dealt a heavy blow to the airline’s operations, particularly its passenger segment.
The airline faced mounting financial losses over several years, reporting annual deficits exceeding €20 million. The sharp drop in travel demand, especially from China—the airline’s target market—accelerated its financial decline. Despite efforts to restructure, reduce workforce, and downsize its fleet, Air Belgium was unable to restore profitability.
By October 2023, Air Belgium ceased all passenger flights, focusing solely on its cargo operations. French logistics giant CMA CGM subsequently acquired the airline’s remaining cargo business, saving 124 jobs in the process. However, the rest of the airline was ordered to enter liquidation by the Walloon Brabant court on April 30, 2025.
The bankruptcy declaration formally shifted the responsibility for outstanding passenger refunds and other liabilities to the court-appointed receivers. An Air Belgium spokesperson confirmed to Belga News Agency that unpaid ticket refunds have now become part of the bankruptcy estate, greatly reducing passengers’ chances of reimbursement.
The collapse of Air Belgium has left a significant number of travelers stranded without compensation. According to ECTAA, this situation reflects a broader systemic issue: when an airline collapses, passengers frequently bear the brunt, especially if they booked through travel agencies or as part of package holidays.
ECTAA represents more than 70,000 travel agents and tour operators across Europe, and has stated that Air Belgium’s bankruptcy caused over €8 million in financial losses, of which around €5 million were absorbed by travel intermediaries.
This places a disproportionate financial burden on travel agents and tour operators, who act as the final link to consumers yet face insolvency risks themselves. ECTAA calls for enhanced regulatory frameworks to better protect travelers and intermediaries alike.
The collapse of Air Belgium is not an isolated case. Over the past 25 years, Europe has witnessed approximately 1,200 commercial airline bankruptcies, according to aviation regulatory bodies and financial analysts.
While large flag carriers often have state support or deeper financial reserves, smaller airlines frequently operate with thinner margins and are more vulnerable to market shocks such as pandemics, fluctuating fuel prices, and geopolitical events.
Chengdu-based Sichuan Airlines was once in talks to invest in Air Belgium but withdrew, reportedly deterred by the airline’s heavy debt. This reflects broader challenges for investors in the airline sector, where profitability and sustainability remain elusive for many operators.
European regulations, including EU Regulation 261/2004, provide some passenger rights concerning flight cancellations and delays. However, insolvency remains a complex issue. While airlines must hold financial guarantees or insurance to cover refunds in case of insolvency, enforcement and coverage often vary.
The European Union Aviation Safety Agency (EASA) and the European Consumer Organisation (BEUC) have highlighted the need for improved airline insolvency frameworks to protect consumers and ensure fair compensation.
In Spain and other countries, additional national regulations address short-term rental licenses, consumer rights, and airline operations to enhance oversight, but gaps remain.
Tour operators who package flights with other travel services face financial strain when airlines go bankrupt mid-transaction. These companies may be forced to cover costs for alternative flights or accommodations without reimbursement, threatening their viability.
ECTAA’s advocacy urges European regulators to:
Such reforms would help stabilize the tourism ecosystem and restore confidence among travelers and industry players.
The bankruptcy of Air Belgium starkly reveals vulnerabilities in Europe’s aviation sector and passenger protection systems. As travel demand recovers globally, governments and industry stakeholders must prioritize regulatory enhancements to safeguard consumers and intermediaries.
Ensuring stronger financial backing, better insolvency protocols, and clearer legal frameworks will be crucial to preventing similar disruptions in the future and sustaining the growth of European and global tourism.
Passengers, travel agents, and airlines alike will benefit from a transparent, resilient, and equitable marketplace, balancing innovation with accountability.
