Continued wrangling puts Atol reform deadline at risk

Continued wrangling puts Atol reform deadline at risk

Implementation of new Atol Flight-Plus rules are being dogged by continued wrangling over agency agreements and a dispute over exemption for budget flights paid for on travel agency corporate credit cards.

Abta chairman and Advantage Travel Centres chief executive John McEwan told Travel Weekly ahead of his involvement in next week’s Barclay’s Travel Forum that the final wording of the agreements has still to be finalised.

He called for “tolerance and latitude” from the CAA over compliance, possibly throughout the summer, as the CAA and trade continue to clash over some of the terminology.

“It’s going to be virtually impossible for those agreements to be in place by the end of May. There’s this toing and froing with the CAA over precisely what the wording is and in my personal opinion it’s going to run beyond the end of May.

“We had the draft wording which Abta translated into a template and the consortia have taken that template and modified it slightly to reflect the fact we, as Advantage, are taking responsibility.

“We are still in dialogue with the CAA about signing off that precise wording and I imagine others are in exactly the same position.

“We obviously want to comply, but we need to get absolute clarity on the precise wording. It will take time mechanically for the liaison with the tour operators to make sure they are compliant and then to disseminate the agreements to the thousands of travel agents out there.

“Although the government will not change its position in terms of implementation date we need to make sure that the whole industry is fully compliant and operating in a way that the changes in regulations require.”

McEwan said there remained an outstanding issue with Flight-Plus in that payment for flights from budget airlines like Ryanair on agencies’ corporate cards are not exempt, despite the CAA exempting flight-only sales made on consumers’ cards.

Agents who package up Ryanair flights will be required to pay the £2.50 per person Atol Protection Contribution (APC) despite not having an agency agreement with the airline in place.

Although some budget carriers, most notably eastJet, have dropped their former opposition to working with agents, Ryanair, thought to account for around 50% of many of Abta’s online agents’ sales, remains vigorously anti-agent.

This raises the possibility that the consumer will be presented with Flight-Plus documentation saying the dynamically packaged holiday is protected despite there being no agency agreement in place with the supplier. This has raised concerns that the CAA in this instance will not be legally required to pay out if there is a claim.

McEwan said: “I doubt we will have a positive dialogue with Ryanair so a loophole in the regulations will remain. Refunds from a corporate card will go back to the agent rather than the consumer but there must be a way to protect the consumer.

“The consumer is protected on their own card payment through the consumer protection act but on corporate cards the concern of the CAA is if the airline folded. That’s were supplier failure insurance comes in which protects the consumer. It’s less than clear, but it’s there.

“I still think there needs to be more changes in the Flight-Plus reforms and there is going to be ongoing dialogue between the industry, Abta and the Department for Transport to look at what’s being proposed. We can expect to see further refinements on Flight-Plus.”


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