The European Commission has given airlines and EU member states six months to improve compliance with new rules on passenger rights or face legal action and possible tougher standards.
The body said airlines had been lax in implementing the rules, which require carriers to compensate passengers for delays, cancellations and denied boarding.
EU governments had also failed to enforce the rules, which came into force some two years ago, strictly enough, it added.
The Commission said airlines frequently did not inform passengers about their rights as required and it proposed strengthening the role of national enforcement bodies.