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Atol ‘may give UK firms a Euro lift’
Lee Hayhurst
lee.hayhurst@travelweekly.co.uk
The UK’s Atol scheme could be promoted by British travel companies across Europe as a top-class financial protection regime, under new rules to be implemented by 2018.
The Department for Transport
last Friday issued its latest consultation on Atol reform as the government works to adopt a new EU Package Travel Directive agreed in 2015. Despite June’s Brexit vote, the
government must forge ahead adapting Atol to the directive, which has to be enforced in 2018, before Brexit will be completed. The consultation points out new ‘place of establishment’ rules could free up UK firms to better compete for customers in Europe by enabling them to be regulated in just one jurisdiction. However, the rule is controversial as it appears to endorse the move by now-failed OTA Lowcost Holidays to relocate to a lighter regulatory regime in Spain to avoid costs.
The consultation suggests how this change, which may increase the financial exposure of Atol, should be considered. Stephen Mason, senior partner at
travel law company Travlaw, said: “We have the most comprehensive regulatory scheme but it’s by no means the cheapest. You would want to know the relative cost. “Is Atol going to cost the same,
more, or less, than say the German or Spanish schemes? “The other question is, what happens after Brexit?” Travel Trade Consultancy
director Matt Purser welcomed easier cross-border trading but doubted there would be a ‘rush to Atol’ if rival schemes were cheaper. The DfT has ruled out considering scrapping Atol in favour of a new regime based on bonding or insurance because there is not enough time before 2018. It is also seeking views on how a new category of travel booking, Assisted Travel Arrangements, are covered by Atol or if they should have a separate scheme to avoid customer confusion.
Lowcost’s failure ‘gave Atol boost’
Lee Hayhurst Hays Travel IG Conference
The collapse of Lowcost Holidays this year reinforced the importance of Atol protection and that has benefited independent agencies, according to Hays Travel.
John Hays, managing director of the UK’s largest independent agency group, expects the collapse to spur a resurgence of the traditional package holiday. “Package holidays are
outperforming the market, not massively, but they’re coming back,” he said. “The main impact of Lowcost’s failure is to reinforce what we have seen for three years. “The awareness of the Atol logo, and people asking explicitly if what they are buying is protected, has increased, which has to be good news for businesses like ours. “Atol is all about financial
The UK must adapt the Atol scheme to the new EU Package Travel Directive
protection. And in an uncertain world, knowing someone is on the end of a phone and will organise flights home is a growing trend that will continue throughout 2017. “For a decade until two or three years ago the cool thing at dinner
“Package holidays are outperforming the market – they’re coming back”
parties was to say ‘I did it myself and saved money’. That’s turned 180 degrees. “The more sophisticated clients
are starting to realise if they do it themselves they’re on their own.” Hays was speaking at the firm’s Independence Group conference
hosted on Royal Caribbean’s Independence of the Seas last week. He said a decision two years ago
to stop dynamic packaging in Hays Travel stores had been vindicated. “Everything we do in our
shops we act as retailer for an Atol-holder. Branch managers love it because they never have to compensate clients,” he said. “We have opened 18 shops in 12 months, so it’s working.” Hays’ in-house operator Faraway
is now a significant supplier to IG members, but John Hays said commercial terms with all
operator partners were improving. › Hays IG Conference, page 15
3 November 2016
travelweekly.co.uk 5 3
John Hays: ‘Decision vindicated’
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