Europe’s biggest budget airline has been ordered to pay up for delayed flights – or face legal action. The Civil Aviation Authority has threatened Ryanair with “enforcement steps leading to court action” if it does not change its stance on passenger compensation.

Under regulations known as EU261, passengers on flights that arrive at least three hours late are entitled to a between €250 (£185) and €600 (£445) in compensation.

The airlines’ only defence is to show that “extraordinary circumstances” such as poor weather, a strike or air-traffic control issues were to blame for the delay. Claims can be backdated as far as the statute of limitations allows – six years in England and Wales.

The CAA says: “Ryanair is attempting to impose a contractual two-year time limit from the date of the flight for passengers to issue compensation claims at court – despite previously publicly committing to a six-year time limit.”

The regulator is also unconvinced that Ryanair is dealing fairly with claims for disruption caused by mechanical faults.

The CAA’s chief executive, Andrew Haines, said: “We will do everything in our power to ensure that passengers are receiving the support they are legally entitled to, during and after disruption.”

Ryanair has asked for an urgent meeting with the CAA, saying it wishes “to clarify any misunderstandings that may have arisen in dealing with some historic cases”.

The airline’s director of customer service, Fiona Kearns, said: “Ryanair fully complies with EU 261 regulations which are a fundamental part of our customer charter.”

The European Court of Justice has ruled that unexpected technical problems cannot be used as justification for refusing compensation.

The judgment found in favour of Corina Van der Lans, a passenger on a KLM flight from Quito in Ecuador to Amsterdam which was delayed for 29 hours because the aircraft had two defective components.