p18 Columnist jun 5 2/6/09 13:47 Page 18
news comment
ttglive.com
Chris Lee Barclays Commercial
“There are many regulatory,
financial and other matters
preventing companies from
thinking about travel”
M
y daughter Abbey recently told admitted to APC and thus saved a considerable
me that geography is boring. amount in bonding fees.
“There is nothing about travel in The next day, Iata bonds were on the agenda.
it,” she said. “You are so lucky to It has been well publicised that Iata has asked
talk about different countries all day, dad.” several companies for bonds they may not have
This made me also consider how many regula- had in previous years. This company wanted to
tory, financial and other matters are preventing discuss the implications and whether it would
travel companies thinking about destinations or be able to avoid the request for this new bond.
travel as much as they might like at present. The week came to a close with an unbelievable
Last week’s meetings with customers included day on the currency markets. One of the most
one company that wanted to concentrate on the popular audit dates among travel companies is
forthcoming changes to the Tour Operators’ October 30. Any company borrowing from its
Margin Scheme (Toms) regulations. These bank is likely to have to supply a copy of the
will be a headache for some, with audited accounts within six months. As such,
changes required to their procedures many of these accounts have just been supplied
and administration, and resulting to banks, and a recurring theme is the exchange
implications on their margins. rate losses many travel firms suffered last year.
The next day, the CAA’s consultation At the end of last month, the cable (sterling/
document relating to the proposed dollar) rate went up and then down about
increase in the Atol Protection Contri- two cents in the same day. This meant
bution (APC) from £1 to £3 was on a a late night for me and my foreign
customer’s agenda, along with the de- exchange dealer colleagues as
bate about whether it would be feasible customers’ forex hedging
to include other bookings currently strategies were adjusted.
excluded from the scheme. My client was The credit crunch is on
wondering whether some of the smaller many companies’ minds and
no-frills carriers would want to voluntarily get one customer wanted to up-
involved at some stage and, even if they did, date me on the redundancies it
would the CAA let them in on account of their had made to preserve its margins.
relatively high perceived risk of failure. At the end of the week, my daughter
Later in the week, I witnessed two clients’ asked: “Another week talking about which
contrasting CAA-related experiences. One had are the best sunny beaches?” I gave her a
been asked to inject more capital into the com- knowing look and thought to myself “if only”.
pany to stay within the APC scheme and had
endured a frustrating search for any meaningful
insurance bond market. The other had been Chris Lee is head of travel at Barclays Commercial
18 05.06.2009
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