The European Council and the European Parliament have agreed to maintain free cabin luggage and financial compensation for delayed flights under the bloc's air passenger rights rules after more than a decade of negotiations.

Under the rules, air passengers will continue to benefit from free cabin luggage and will be entitled to financial compensation if flights are delayed by at least three hours – a key demand from the European Parliament that was resisted by several EU countries.

“The fees that need to be paid are the same as those known for airlines for almost 20 years now. It's a situation that gives predictability,” one EU senior diplomat told reporters on Friday, after the deal was struck.

European air travellers are already entitled to compensation of between €250 and €600 if a flight is cancelled or delayed by more than three hours. The new text backed by EU co-legislators clarifies that airlines will pay €300 on flights of more than 3,500 kilometres and €600 if the delay exceeds four hours or ends up being cancelled.

The rules also spell the end of cabin baggage fees, a common practice among low-cost airlines like Ryanair or EasyJet. Passengers will now be entitled to both a free personal item measuring 40cm by 30cm by 15cm and a small wheeled item with a maximum total dimension of 100cm and a weight of up to 7kg.