LUFTHANSA REFUSED COMPENSATION FOR CANCELLED FLIGHT

BristolAli

Hi, 
I had a flight booked to Washington, USA booked with Lufthansa, this was with a tranist in Munich.
 I flew from Heathrow to Munich, whilst at the gate in Munich ready to board  Washington flight they announced it was cancelled, i was put on an alternative flight 24hrs later, they have replied with below:

Kindly note that Regulation (EC) No. 261/2004 applies to flights departing from EU member states and flights arriving in EU member states from third countries. As your journey starts in London and ends in Washington, we cannot accommodate your request for compensation according Regulation (EC) No. 261/2004.

Am I not entitled to the EU compensation due to Germany being in the EU? the ticket was all booked with Lufthansa from Heathrow to Washington, 
i have lost out financially for the hotel in Washington I did not use, they haven't refunded me for that either. 

Any advice appreciated.

Thank you

saajan_12

What you need is UK261 - the UK equivalent of EC261 since Brexit. That would apply to flights leaving from the UK, which they're arguing yours is, treating it as one journey London - Washington.