Alex_B, thanks for your comment. EU 261 certainly does apply. Because of the extraordinary nature of the situation no compensation will be due, the EU have confirmed that. However the reimbursement conditions still apply. Air NZ should have offered them full reimbursement and/or tried to put them on another flight. They did offer one which was via Tokyo but wanted them to pay astronomical amounts to pay the upgrade to business. They are on an economy ticket and a PE ticket with upgrade vouchers. They would have been happy with economy tickets to get back.