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I had a flight from Frankfurt to Bombay via Delhi where I missed the Delhi connection since the first flight leg was delayed. Overall delay in Bombay was 4+ hours.

Am I eligible for compensation under the EU rules? Does the delay at the first non-EU destination matter or the overall delay.

Entire flight was booked as one PNR. It was a non-EU airline (Air India) but I don't think that matters for flights FROM EU Destinations?

The delay wasn't due to weather or other force majeure reasons so I am only trying to accurately interpret the wording of the EU regulation.

Due to the distance involved it should be a Class 3 flight and hence eligible for EUR 600 compensation.

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As long as it's a single PNR, it's always the whole itinerary which is considered, whatever the number of stops, so it's the delay at the final destination which counts.

From https://www.irglobal.com/article/european-court-of-justice-extends-eu-261-to-compensate-passengers-for-connecting-flight-delays-and-cancellations/ :

European Court of Justice Extends EU 261 to Compensate Passengers for Connecting Flight Delays and Cancellations

On July 11, 2019, the European Court of Justice (“ECJ”) issued a decision holding that European Union Regulation (EC) No 261/2004 (“EU 261” or the “Regulation”), which entitles certain passengers to fixed compensation for flight cancellations and long delays, extends to connecting flights made on the same reservation.

...

The recent ECJ decision clarifies that passengers are entitled to the same compensation for the long delay or cancellation of connecting flights that are the subject of a single reservation even if the second of the two connecting flights was performed by a non-Community air carrier from and to a country which is not an EU Member State.

(emphasis mine)

In your case, it's the delay arriving at Bombay which counts, and nothing else (for the purpose of compensation).

Indeed, as the flight is departing from the EU, the fact it's a non-EU carrier is irrelevant.

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