Fred Olsen clarifies position on agent discounting

Fred Olsen clarifies position on agent discounting

Fred Olsen has reviewed its position on agent discounting following discussions with Abta.

The line capped commission at 10% in March last year, with a bonus at the end of the year for agents who do not discount.  It has now altered its position by stating it should be made clear that discounts have come from agents and not the cruise line.

Sales and marketing director Nathan Philpot said the previous strategy had received "positive feedback from agents that recognised this level playing field has been beneficial to all parties".

He added: "However, following discussions with Abta, we have reviewed our position on this matter and have decided to issue some clarification and guidance to agents in respect of their rights and obligations to Fred Olsen Cruise Lines (FOCL) where discounting is concerned."

The decision means that if agents wish to provide a discount to passengers, it should be made clear that it has been provided by the agent and not Fred Olsen. The line said it would continue to advise agents on prices for its cruises, which will be the price forming the contract between Fred Olsen and passenger.

Under the reviewed position, Fred Olsen said agents are to record any discounts or inducements which they are providing on headed paperwork, separate to the paperwork setting out the cruise price given from Fred Olsen. It must also be made clear that the discounts have nothing to do with the contract between the line and the passenger.

In a statement, Fred Olsen said it was also important from a liability perspective to show a clear distinction between its contract with the customer over pricing and agent's discount for passengers. This means that if an agent arranges for free transport or hotel accommodation, it must be clear that this is under the agent's personal liability and not the cruise lines.

Industry lawyer Sarah Lacy previously told Travel Weekly that cruise operators' attempts to stamp out discounting could breach competition laws.



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