Emirates Airline has been fined US$100,000 (Dh367,315) by the US government for failing to compensate passengers sufficiently for lost, damaged and delayed baggage.
The US transport departmentsaid an investigation showed "multiple instances" of violations of global rules controlling the handling of baggage claims for flights to or from the US.
"All air passengers, regardless of whether they are taking domestic or international flights, deserve to be compensated fairly for lost, damaged or delayed baggage," said Ray LaHood, the department secretary. "We will continue to take enforcement action when necessary to protect airline consumers."
An Emirates spokesman said the airline took with "the utmost seriousness" its responsibility to comply with the agency's guidelines on baggage liability under the Montreal Convention.
"We have conducted a thorough review of our baggage claim handling procedures and documentation in order to ensure that we are following best practices and delivering the highest standards of service to our customers," said the spokesman.
The department said the airline denied any intention to deliberately misinformpassengers about their rights under the Montreal Convention.
In many cases, Emirates refused reimbursement for high-value items such as lost electronics, jewellery and cameras, according to the agency.
In its written responses to passengers, Emirates stated that its contract of carriage limited its liability for lost high-value items and certain damage to baggage, the department said.
It added that Emirates incorrectly stated that limiting its liability in such a manner was in accordance with the Montreal Convention.
The Montreal Convention is an international agreement setting out liability limits for air transportation and holds airlines liable for damages caused by lost, delayed or damaged luggage up to the equivalent of about $1,820. The exception is if the carrier has taken all reasonable measures to prevent the damage or if it was impossible to do so.
Carriers are forbidden under the convention from setting a lower baggage compensation limit for international flights, the department said. In addition, airlines cannot refuse to provide compensation for jewellery, electronics or other certain items.
The investigation took place after a consumer complaint to the department.