When the number of passengers exceeds the number of seats on a flight, the airline must first call for volunteers to surrender their seats. The benefits given by the airline in exchange for a passenger surrendering his or her seat can be agreed on between the airline and the passenger concerned.
If you do not wish to surrender your seat voluntarily and you are denied boarding without reasonable grounds, you can choose either re-routing or a refund of the price of the ticket. You will also be entitled to standard compensation as well as care by the airline while waiting for the re-routed flight.
Reasonable grounds for denial of boarding and refusal of compensation include e.g.
Passengers who are denied boarding voluntarily or against their will can choose from the following alternatives:
Passengers who are denied boarding against their will are entitled to standard compensation. Standard compensation is determined by the distance of the flight and the delay caused by re-routing, if applicable. The airline can pay passengers the reimbursed cost of the ticket and the compensation amount in cash, by bank transfer, by cheque or, with the signed agreement of the passenger, in travel vouchers or other services.
Related legislation: EC Regulation No 261/2004 establishing common rules on compensation and assistance to passengers in the event of denied boarding and of cancellation or long delay of flights