The multiples have won a significant battle against the Government after it ditched demands they display their ownership links on shop fascias.
Travel Weekly exclusively predicted the Department of Trade and Industry would water down its proposals (Travel Weekly April 5).
Minister for competition and consumer affairs Dr Kim Howells said the Government had failed to obtain undertakings from all the vertically integrated companies on displaying ownership links on shopfascias.
The failure to agree terms with the multiples, despite lengthy negotiations, has forced Howells to propose issuing an order under the Fair Trading Act 1973 to make ownership links transparent.
The links will have to be made clear on the inside and outside of travel agency businesses, and on brochures, stationery and advertisements.
Thomson Travel Group is believed to have raised objections to outlining its ownership links on shop fascia. It already displays ownership links in its retail shops.
One industry source said: “When you spend millions of pounds investing in building up a brand like Lunn Poly you do not want it diluted by having to list all the other companies you own underneath.”
Thomson refused to comment but a spokesman said: “We are disappointed that the DTI has decided to progress by way of an order and await the draft proposals.”
Airtours group managing director Harry Coe said it had been ready to comply with all the Government’s undertakings and already displays notices in its retail shops.
“We were prepared to do all that was necessary to keep the Government happy.” But he added: “I do not think the consumer cares who owns which tour operator. They are only interested in who gives the best value for money.”
A Thomas Cook spokeswoman said it had always been prepared to comply with the undertakings.
“We’ve never had an issue on transparency because our shops are called Thomas Cook,” she added.
Interested parties have until September 15 to make their representations before the order is made. The Government does not expect the changes to be made until at least January 2000 – over two years after first demanding great transparency.
Meanwhile, the Association of Independent Tour Operators chairman John Bennett called for a separate print run of brochures for independent agents so they did not have to rack programmes mentioning their competitors.
n See Columnists, page 11
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