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FCO advice on no travel

You 03:50 PM

Because of FCO advice now does that mean all forward bookings can be cancelled and customers have a right to a full refund or do we look at bookings on a rolling basis? Eg a booking in November....?

 

2 Collaborators
Pravin KantariaDirector
Abra DunsbyFormer TTG Features Editor

2 responses
Pravin KantariaPravin Kantaria13 Apr 2020 17:38

Hi Farina and all other experts I wonder if you can help us as a matter of urgency, please. We had booked a package holiday to Africa for a small group (25 passengers) in September 2019, however, not travelling until the middle of July 2020. The cost of the package holiday was £72,000 out of which have been paid merely £21,000, the balance of £41,000 was due on 01 April 2020. In the meantime due to several unknown changes by the airlines we had no choice, but paid in full for all e-tickets, were all issued in Sept 2019. This was to secure and guarantee the price. We posted all e-tickets to the group, safely received, requested if they could pay some more money, simply refused not due until 01 April 2020. Had no choice, had to wait, but huge amount tied up for the past 7 months. One week before the 01 April we sent a reminder to pay the balance, £41,000, did not even receive a reply. We then sent another on 11 April informing that the balance remains unpaid, they were in breach of contract. We then received a reply, wish to cancel the entire holiday due FCO Advice, requesting to refund all the deposit. Can you please imagine that the Travel Industry is bleeding to death, to borrow some £41,000 on an open market (more than security would require), would have incurred huge interest? Please help. We do not have unlimited funds in our account. Finally all the hotel rooms and other services remain fully confirmed.

Abra DunsbyAbra Dunsby14 Apr 2020 12:29
Hi Pravin,

We've had the following response from Farina Azam, partner at Kemp Little:

"Although the FCO has advised against travel indefinitely, this advice could well have changed by July. As such, I would not say that customers due to travel in July are automatically entitled to cancel their holiday at this stage. If we get to June/July, and the advice hasn’t changed then at this stage, you or they could cancel and receive a full refund (or, at least initially, a refund credit note). If they insist on cancelling their trip in April, then you are entitled to impose your standard cancellation charges. What you can actually claim though will depend on the wording of your terms and conditions, and what it says re: failure to pay balance due date and cancellation charges. I’m assuming that failure to pay balance will allow you to retain the customer’s deposit. However, if the extension of payment for the balance due date takes the customer into higher cancellation charges (as explicitly stated in your T&C’s) then you could try and claim more from the customers on this basis – but trying to recover cancellation charges from a customer which are higher than the payment you’ve already received from the customer will be very difficult in practice – and it’s unlikely you’ll manage to recover this additional sum.



The key here is that when confirming bookings, you should ensure you collect a deposit which covers all advance payments you have to make to airlines/suppliers before the balance is due – this ensures you’re not out of pocket where the customer fails to pay their balance. You do also have a duty to mitigate your losses – so anywhere you can recover payments from suppliers, you should do so."

Thanks


Abra DunsbyAbra Dunsby09 Apr 2020 16:44
Hi Kathryn,

Please find a response from Farina Azam, partner at Kemp Little below:

"No – all forward bookings do not need to cancelled and should be reviewed on a rolling basis. This is because the FCO advice could change without notice and the customer would then be able to travel again."

Hope this helps!
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