WIREDGOV

Government provides business with package travel guidance

DEPARTMENT FOR BUSINESS, ENTERPRISE AND REGULATORY REFORM News Release (2008/018) issued by The Government News Network on 24 January 2008

New guidance for business on the definition of a "package" holiday has been published today.

The guidance provides greater certainty for the travel industry on what is a complex area.

Package holidays offer safeguards not available with other types of travel. These benefits mean different legal obligations for the businesses selling them.

Publishing the new guidance on behalf of the Department for Business, Consumer Affairs Minister Gareth Thomas said:

"The travel industry and holidaymakers both need clarity about what is a package holiday so that industry understands what is expected of it and consumers understand what they are buying."

Businesses need to establish whether the services they are offering are considered to be package holidays, or whether they are a number of separate travel services.

Sometimes this is straightforward, but in some cases it is much harder to decide. The Guidance sets out a range of examples and factors, identified by the Courts, which need to be considered, including advertising and customers' perceptions.

Noel Josephides of the Association of Independent Tour Operators (AITO) said:

"The updated Guidance Notes, detailing what constitutes a package and thus requires financial protection, will not only dispel confusion and help travel agents and tour operators to adapt to the new order, but will also ensure that the travelling public continues to enjoy financial protection for holiday purchases - which can, after all, be the major family purchase of the entire year. "

Andrew Cooper of the Federation of Tour Operators (FTO) said:

"FTO welcomes this attempt to provide clarity in an area in which there has been significant confusion and uncertainty amongst the trade and the general public as a result of the rapidly changing marketplace".

Simon Bunce, ABTA's Head of Legal said:

"This is a very good assessment of the High Court Judgement decision on what is a package. However, we are still urging companies to seek specific advice about their own holiday products as this remains a complex area of law in need in reform by the European Commission."

Notes for editors

1. In 2005 the Association of British Travel Agents (ABTA) legally challenged a guidance note issued by the Civil Aviation Authority (CAA) relating to the Air Travel Organisers Licence (ATOL) Regulations. The case turned on the definition of a "package".

2. Following the Judgment, issued by the Court of Appeal in November 2006, BERR committed to updating its guidance for business on the definition of a "package" to reflect the interpretation of the Courts.

3. The Guidance does not change the law

4. In the UK, anyone who sells package holidays must comply with the Package Travel, Package Tours and Package Holiday Regulations 1992 (PTRs). The PTRs provide consumers with statutory legal rights against tour operators. For example, all tour operators selling packages must be bonded or protect the prepayments they hold. That means if they become insolvent before the consumer travels, they should get their money back or, if already abroad, be able to complete the holiday and get home without any extra payments. Consumers also have rights in relation to changes made to their holidays or if the brochure was misleading. The Regulations also enable dissatisfied holidaymakers to pursue their case with a single supplier, the travel organiser, instead of with individual suppliers such as airlines or hoteliers. Where a tour operator has failed to honour its contractual obligations to a customer, it may be liable to pay compensation.