Package holiday customers will likely be entitled to a refund if the Foreign Office (FCDO) is advising against travel to their holiday destination.
That was the conclusion of legal experts speaking at Abta’s Travel Law Seminar this morning. There may be “nuances” to this, however.
Kemp Little partner Farina Azam said the new PTRs’s Regulation 12.7 around customer cancellation had “thrown up some interesting scenarios”.
It states that a customer is entitled to cancel their package in the event of unavoidable and extraordinary circumstances occurring at the place of destination or its immediate vicinity and which significantly affect the performance of the package or the carriage of passengers to the destination.
Azam said this should be considered particularly in the context of “high risk” customers.
“It’s going to come down to your interpretation of the PTRs. If you do want to move away from refunds due to that issue [FCDO advice change] you need to make it clear before your customer is booked to travel.”
She added the European Commission had issued guidance on how to interpret Regulation 12.7 and, it considers government advisories “to be where Regulation 12.7 would apply”.
Azam said she believes a court would say the customer was entitled to a refund.
Rhys Griffiths, partner at Fox Williams said later there were nuances to the interpretation.
He said: “If the FCDO advises against travel, historically that usually means that there’s a serious incident, a serious situation in resort… it’s no longer safe for the customer to go there.
“Therefore, Regulation 12.7 is triggered because ultimately that depends on looking at the circumstances in-resort.
“I think where this issue has arisen recently is the way in which FCDO advice has been used with blanket, worldwide restrictions, where you have some countries with infection rates of maybe five per hundred thousand, which leads one to question the approach and call for travel corridors and a more nuanced approach, like we’re now seeing with Greece.
“So I think the issue really is around those situations where the FCDO advice has been used maybe for public health reasons in the UK, which calls into question whether it actually reflects the risk in a particular resort, particularly when other countries are not issuing advisories against traveling to that particular jurisdiction.
“So I think has arisen now only because you’ve had situations where you have places like New Zealand, which were covered by blanket advice with incredibly low infection rates.”
Asked whether he was saying it came down to contracts – dealt with this through your Ts and Cs and through your booking journey – Griffiths said there were two issues to consider.
“There is a contractual issue,” he said. “Regulation 12.7 will apply depending on what the situation is.
“Obviously if your terms and conditions have promised something else, then you’re going to be bound by that.”
Andrew Hadley, assistant director, policy, advocacy and international, from the office of the general counsel at the Competition and Markets Authority, was asked for the CMA’s interpretation of what was required when the FCDO is advising against travel.
“Our formal position is it seems very difficult not to see the restrictions in a destination as both unavoidable and extraordinary, so it looks like it would entitle the consumer to a refund.”
The issue of local lockdowns in the UK was also covered.
“We can equate that kind of situation to, for example, breaking your leg shortly before travel,” said Matt Gatenby, senior partner at Travlaw.
“If you can still do your bit I think you can state you are not going to refund. If that’s not something for consumer insurance I’m not sure what is.”