BUSINESS NEWS Abta Travel Law Seminar: Trade urged to feed back on PTR reform proposals. Ian Taylor reports
Officials reject ‘two-tier’ claim on domestic breaks
The demands of UK hoteliers and smaller domestic tourism businesses lie behind government proposals to remove domestic package holidays without a travel element from the Package Travel Regulations (PTRs), despite concerns in the outbound trade. Aviation and travel lawyer
Jo Kolatsis, director of Themis Advisory, told an Abta Travel Law Seminar last week: “If we’re going to give consumer protection, we should give it across the board.” Noting the government is “looking
at removing a volume of trips” from the regulations, she asked: “Are we heading toward a two-tier system?” In a consultation on PTR reforms
published in April, the Department for Business and Trade (DBT) proposes exempting domestic packages which don’t include travel, saying: “We’re looking to encourage the provision of arrangements that involve accommodation and other tourist service such as excursions or
Jo Kolatsis
consumer protection?” She said the proposals would “put the international market out of sync with the domestic”. But Danielle Gazi, senior policy
admission to events and attractions.” The department also proposes to
clarify when “other tourist services”, such as concert tickets, sports events, excursions or spa treatments, form part of a package. Currently, these elements are considered part of a package if they make up a “significant proportion”, such as 25%, or comprise an “essential feature” of a booking. Kolatsis noted: “I’ve used that
25% rule when giving guidance. Why give people more scope to sell outside the regulations when this is about
advisor for consumer and competition policy at the DBT, said: “Small and medium-sized enterprises and micro businesses are unable to offer ‘bundles’ due to the [current] PTRs requirements because they’re unable to get insurance [to financially protect these]. We would like to grow the domestic sector, and this fits the wider government growth programme.” She insisted: “Our core aim is not
to have the travel element removed. It’s to allow people to create micro- bundles. There is no intention to create a two-tier approach.” Gazi said feedback from the
domestic coach sector suggests it is “very happy to keep the travel element” in the regulations. Her fellow DBT policy advisor
Andrew Powell said: “We’ve heard overwhelmingly from the SME sector that the regulations are a burden.”
Widening cover ‘raises issue of FCA enforcement’
The government is keen to gauge industry reaction to proposals for increased flexibility in provision of package travel insolvency protection. DBT’s Andrew Powell noted
“a lot of support for increased flexibility”, saying a Call for Evidence on PTRs reform in 2023 “heard there is a lack of options”. The current consultation on
PTRs reform proposes allowing a combination of bonds and trust arrangements. DBT’s Danielle Gazi said:
“We want to know is it worth introducing this? Is it practical?” The consultation also
proposes relaxing requirements that restrict insurance provision to providers authorised in the UK, Channel Islands or Isle of Man. Will Plummer, chief
executive of Trust My Group, made clear his opposition, saying: “If there is a failure, will the Financial Conduct Authority have the power to ensure the insurer pays out?”
Government seeks industry feedback on continued relevance of LTAs
The extent to which holidays are booked as Linked Travel Arrangements (LTAs), with limited consumer protections under the Package Travel Regulations (PTRs), remains unclear, according to government policy advisors. The DBT’s Andrew Powell
said: “Are LTAs being used? We’re not sure. Are they being used and people don’t realise? Quite possibly.
travelweekly.co.uk
Are they a necessary evil to cover a loophole [in the regulations]?” Powell said “we were told
LTAs were not being used” in responses to a Call for Evidence on PTRs reform in 2023. “Now we’re having conversations that LTAs are being used.” The current DBT consultation
on PTRs reform proposes to retain the LTA category but “limit the ways
Simon Bunce
in which an LTA can be created”. The DBT’s Danielle Gazi said:
“We know certain sectors do use LTAs.” She argued: “We could get rid of LTAs or turn everything into a package. We want you to say if you use them, or why you don’t use them.” Abta director of legal affairs
Simon Bunce agreed LTAs “are not being used generally, but some businesses are doing it”.
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PICTURES: Piotr Mitelski; Rüdiger Nehmzow; Steve Dunlop
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