Nepal moves to guarantee compensation for flight delays and lost bags

Nepal is moving toward a new legal framework that would require domestic airlines to compensate passengers for disruptions such as flight cancellations, lengthy delays, and mishandled baggage, as lawmakers advance a draft bill aimed at tightening airline liability and improving consumer protections in the country’s fast-growing air travel market.

What the proposed passenger-compensation changes would do

Published coverage indicates the pending legislation is titled the “Domestic Air Service Liability Bill, 2083,” and is designed to put clearer, enforceable responsibilities on domestic carriers when flights do not operate as scheduled or when passenger property is lost, damaged, or delayed.

Reporting also describes a notice requirement: if a flight is canceled, postponed, or delayed, airlines would be expected to inform passengers in advance, including a commonly cited three-hour threshold before scheduled departure for certain disruption scenarios. The framework is presented as a shift from largely airline-specific policies toward a more standardized set of passenger rights in domestic aviation.

In addition to compensation, the bill is framed as a transparency measure. Published coverage indicates it would require clearer ticket disclosures that separate airfare from taxes and other surcharges, an area that has often been handled inconsistently across sales channels.

How baggage claims and caps are being defined

One concrete figure repeatedly referenced in coverage is a proposed cap for baggage mishandling: compensation of US$20 per kilogram up to a maximum of US$500 for lost or damaged baggage in domestic travel. That approach mirrors the way some carriers already communicate liability limits in their conditions of carriage, but would place it into a broader statutory framework for domestic airlines.

For travelers, the practical change is less about creating a brand-new concept of compensation and more about making the rules easier to point to when something goes wrong. Nepal Airlines, for example, publicly posts baggage mishandling instructions and liability limitations, including steps such as filing a report immediately at the airport baggage desk and presenting documentation for follow-up claims.

Even with clearer compensation rules, the administrative steps will still matter. Travelers typically need a written record created at the airport when a bag fails to arrive, and they may face time limits for written notice depending on the governing conditions of carriage and any applicable treaty standards on certain routes.

What counts as an airline-responsibility disruption (and what may not)

Published reporting suggests the bill distinguishes between disruptions within an airline’s control and those outside it. Exceptions referenced in coverage include flight interruptions linked to adverse weather, natural disasters, airport or air traffic service disruptions, and security restrictions. Under that structure, compensation obligations would be more likely to attach when the underlying cause is attributed to airline weakness or preventable operational issues, rather than force majeure events.

The distinction is significant in Nepal, where mountain weather, airport capacity constraints, and terrain-driven operational limits can create knock-on delays and cancellations that are difficult to avoid. The proposed approach appears aimed at ensuring that when avoidable disruptions occur, passengers have clearer paths to compensation and service remedies.

At the same time, the framework also appears intended to reduce last-minute uncertainty by pushing airlines toward earlier passenger notifications and better operational planning, particularly during peak trekking seasons when flights to gateway airports can be heavily impacted.

Insurance, liability limits, and alignment with global standards

Alongside delay and baggage provisions, published coverage highlights a broader liability overhaul for domestic aviation, including mandatory insurance requirements and higher liability ceilings in the event of serious incidents. The same reporting points to a proposed increase in compensation for deaths and injuries in domestic air accidents, with a figure of up to US$100,000 discussed as part of the reform package.

Coverage also indicates the bill is meant to bring Nepal’s domestic liability framework closer to international norms that apply more clearly in international travel, where widely used treaty-based rules set standardized liability limits and claims processes. While the proposed law focuses on domestic carriers, the intent described is to reduce gaps between domestic and international passenger expectations.

For travelers, the relevance is that a more explicit liability regime can make it easier to understand what an airline must cover, what documentation is required, and which disputes can be escalated to regulators when a carrier rejects a claim.

Where the bill stands now and what travelers should watch next

As of August 2026, published coverage indicates the bill has advanced within Nepal’s legislative process, including steps in the National Assembly to consider the measure and send it forward for more detailed, clause-by-clause review. Final passage, implementation dates, and the exact thresholds that trigger compensation may still change as the text is debated and revised.

For now, travelers booking domestic flights in Nepal should watch for official publication of the final law and any subsequent regulations that specify compensation amounts, timelines, and complaint procedures. Those implementation details will determine how quickly claims must be filed, what evidence is required, and how enforcement will work in practice.

Until the new framework is fully in force, airline-specific rules still apply. Travelers can reduce headaches by keeping tickets and receipts, photographing baggage tags, filing baggage reports before leaving the airport when a bag is missing, and saving written notices of delays or cancellations when seeking reimbursement under existing policies.