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.