REGULATION
‘We’re in a similar position to a year ago’
THE CIVIL Aviation Authority (CAA) and Department for Transport confirmed a delay to Atol reform in January 2024, blaming the “complex” work required following analysis of industry responses to a CAA Request for Further Information issued a year earlier. They asserted there “remains
a strong case” for reform, noting: “The CAA continues to observe a considerable number of Atol holders using advance customer monies to fund operational expenditures.” However, the announcement gave no indication of when the reform, which began with a consultation in April 2021, will proceed. Deloitte legal director Luke Golding
pointed out: “We’re in a similar position to a year ago, in that there is reform proposed to two key pillars of travel regulation – the Package Travel Regulations (PTRs) and the Atol scheme – and we don’t have clarity as to what that reform will result in.” Golding argued: “The travel industry
has proved very resilient. It had a good summer 2023. Yet we have headwinds in terms of high interest rates and the
The industry awaits clarity on key proposals for Atol reform as well as the Package Travel Regulations
cost of living which may impact on demand. So, the industry really needs a period of stability and certainty, and the delay in Atol reform doesn’t help. “It had seemed from the consultation
documents that the CAA had a relatively certain view of what it wants [and] segregation was the path it was heading down. It will be interesting to see whether the delay signals a change in approach or whether it’s a reflection of the fact that government attention is elsewhere in the run-up to a general election. “I would be surprised if it resulted
in reform not happening. The CAA has been so clear and consistent in its desire to see this through. Even if there is uncertainty and a lack of ministerial attention, I would expect the CAA to still be pushing this reform and be surprised if it dropped off the table. “The CAA has emphasised segregation
ATOL authorisations were at an all-time high in October 2023, with the dominance of the largest Atol holders increasing (Figure 48)
FIGURE 48: ATOL AUTHORISATIONS, 2018-23 Atol holders and authorisations 2,000 1,500 1,000 500 0
5m 10m 15m 20m 25m 30m 35m
2018 Atol holders 2019 2022 2023 Atol authorisations 0 Leading Atol holders as % of total %
10 20 30 40 50 60 70 80
0 2018 Top 5 2019 Top 10
*March 2019, figure rounded **October 2023, authorisations for 2024 Source: CAA/Travel Trade Consultancy
2022 2023
is still its preferred approach. But it doesn’t look like trust accounts are going to be mandatory and client accounts are the only realistic alternative.” Golding added: “There is going to
have to be a relatively long lead-in time to allow people to prepare, both from the technical perspective and from the point of ‘How do we fund our business?’ It’s going to be some time until changes come in. The industry could do with knowing precisely what the changes are so businesses can start taking steps to accommodate the requirements.”
REFORM OF THE PACKAGE TRAVEL REGULATIONS The Department for Business and Trade published a Call for Evidence on PTRs reform in September and the proposals include revising or removing the regulations on Linked Travel Arrangements (LTAs). Golding explained: “My view is
LTAs should go. They’re not well-used or understood and difficult to enforce. Airlines are where LTAs fit most comfortably. The question is, are people
38 Travel Weekly Insight Report 2024
2,000* 28.1m 1,814 25.7m
1,567 26.3m
1,584 31.6m**
50% 61% 53% 65% 62% 75% 63% 77%
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