Kuwait Airways: New German Appellate Decision Allows Discrimination Against Israelis

Friend of Letters Blogatory Peter Bert has pointed me to a new decision from the Oberlandesgericht München in the Kuwait Airways affair. The airline, Kuwait’s flag carrier, refuses to carry Israeli passengers because of Kuwait’s discriminatory anti-Israeli boycott law. As I noted several years ago, the airline dropped its New York to London route rather than comply with US law on nondiscrimination by air carriers.

Today’s case refused to hold the airline liable for refusing to sell a ticket to an Israeli seeking to fly to Sri Lanka via Kuwait City. The apparent justification for the decision, if I am understanding the article correctly, is that in light of the Kuwaiti law, the airline had a defense of actual impossibility (tatsächlicher Unmöglichkeit). As I have noted before, the airline’s status as a state-owned enterprise seems to make this a difficult argument. Didn’t the Kuwaiti state create the impossibility? In any event, the root of the problem here is of course Kuwait’s law, and we should press for a repeal.

10 thoughts on “Kuwait Airways: New German Appellate Decision Allows Discrimination Against Israelis”

  1. Philipp Fölsing

    Dear Mr. Folkman, both higher regional courts in Munich and in Frankfurt do not argue that it is legally impossible for the airline to transport the passenger with layover in Kuwait. They do expressly state that Kuwait’s law is inacceptable and must be disregarded by German courts because it violates fundamental principles of German law. Because the German courts explicitly refuse to apply Kuwait’s law as overriding as a German lawyer I rather do not agree with the Conflict of Laws article you mention.

    Both higer regional courts however accept that it is factually impossible for the airline to transport the passenger. As the owner of a passport from Israel the passenger was not allowed to enter even Kuwait’s transit zone. Of course this is wrong. As the airline is owned by the Kuwaiti state, the competent German authorities should certainly consider to revoke the start and landing rights of the airline.

    However for the German civil courts it is difficult to react in an appropriate way. They can do nothing but emphazise that Kuwait’s law violates fundamental legal principles and therefore condemn it as unacceptable. Because they did so unequivocally they should not be blamed.

    All the best from Hamburg

    Yours Philipp

    1. Thank you Philipp! I appreciate your explanation of the German courts’ views, and I agree with you that the court rejected and expressed disapproval of the Kuwaiti law. I wonder, though, what you think about the point about the state-owned nature of Kuwait Airways? Suppose you and I have a contract and I do something that makes it factually impossible for me to carry out my half of the bargain. Surely I cannot then plead impossibility as a defense to enforcement? Why is that not the case here? I had previously written that I thought the earlier German decision was correct, until the fact that the airline was state-owned was pointed out. Why is that not a highly significant fact here?

      1. Philipp Fölsing

        Dear Mr. Folkman, I agree with you that it is a difficult case. But what would be the alternative? What would happen if the German court ordered the airline to transport the claimant? The claimant would be refused entry to the transit zone at the Kuwaiti airport. Probably he would be sent back to Germany where he came from. That’s why I believe that it is not for the German courts but the German authorities to act in an appropriate way, either by revoking the start and landing rights altogether or by prohibiting the airline from offering flights with layover in Kuwait.
        All the best, Philipp

        1. I agree with you that it would be inappropriate to order specific performance. But is there no damages remedy? The article does not seem to specify the remedy sought. But suppose it cost $1,000 to get from Munich to Sri Lanka via Kuwait Airways and $2,000 to get from Munich to Sri Lanka via another route, could not Kuwait Airways be liable for the difference in price for example? This is leaving aside whatever damages remedy German law might allow in cases of discrimination on the basis of nationality.

          1. Philipp Fölsing

            Unfortunately I do not know if the claimant applied for and the court awarded material damages and/or idemnification for discrimination. But you are right, damages and idemnification might be possible under German law. However I believe that actions of the competent authorities might be more effective than lawsuits by single passengers. All the best!

          2. Thanks, Philipp, for the interesting dicussion! I agree with you that action by the authorities might be preferable. In the United States, the Department of Transportation found that the airline’s practices were illegal under US law (here), and as a result, the airline dropped a route rather than comply with the law (here). There is, though, an important distinction between the two cases: the US case involved a direct flight from New York to London, without transit through Kuwait City.

          3. Right, the OLG München even acknowledges that for flights that don’t go via Kuwait, the result would be different because in those cases, it would be possible to fulfil the contract.

  2. Imo there’s exactly one correct way how the airline should have dealt with this situation:

    1) Issue the plaintiff a ticket for a different airline which doesn’t go via Kuwait
    2) have airline management formally apologize for the inconvenience
    3) upgrade the ticket to business class free of charge

    Now why did nobody in this proceeding consider the option to re-issue the ticket to a different route/airline??

    (Greetings from Saxony)

    1. Thanks, Anonymous, for the comment! I guess that’s a question of German remedies law. But I agree that fundamentally, the remedy is to put the passenger in as good a position as he would have been had he been allowed to fly.

  3. I’d like to raise a question:

    Why did nobody in this case consider the option that the airline might reissue the flight ticket so the plaintiff can travel on a different route, maybe with another airline?

    This could be expensive for the airline but this way the airline would be able to fulfill its obligation.

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