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23 Sep 2015

BY Sophie Griffiths

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TRFBLI

Further delay on cards for SBA holders

The CAA has further delayed financial tests for Small Business Atol holders, TTG has learned.

Delayed sign, delays

The SBA financial tests had been due to be introduced from October 1, but the CAA admitted in July the tests would now not come into force for new Atol holders until April 1, 2016, and for existing Atol holders not until September 2016.

 

At the time, the CAA said full details of the tests would be made available in September instead.

 

But in its Atol newsletter released this month, the CAA confirmed that although it had “intended to publish full details this month of the new financial tests... we now intend to publish an updated Financial Policy note and provide the self-assessment facility at the end of this year.”

 

Explaining the reasons behind the delay, the CAA admitted that work was still being undertaken on developing the tests: “We believe that this information should include meaningful details on the tests as well as an online facility to enable Atol holders to assess their own financial data.

 

“We are still undertaking work on calibrating the SBA solvency test and the online self-assessment tool.”

 

The CAA insisted the introduction remained unchanged since the dates released in the summer.

 

Alan Bowen, legal advisor to the Association of Atol Companies, said the news was “disappointing”. “They have clearly seen that SBAs are a risk,” he said. “The sooner the CAA gets more financial protection in place, the better.”

 

Martin Alcock, director of The Travel Trade Consultancy, said: “Assuming the tests are announced at the end of this year, that leaves very little time for those companies with, say a December 2015 financial year-end, to undertake any necessary financial planning that will ensure their year-end accounts meet the required tests when they are assessed at the September 2016 renewal.

 

"I would hope the CAA will show clemency towards those SBAs and small standard Atol holders who fall short of the tests in the first two or three years of this new regime.”

This Atol scheme has been plagued by delays, and the latest news will likely come as little surprise to the trade. As experts have noted however, these new financial tests will represent some of the biggest changes to the Atol scheme in recent years and have the potential to have profound effect on many SBAs and small standard Atol holders - it is therefore of course important that the CAA does not rush through the changes.

 

That said, perhaps more realistic time frames should have been offered in the first place, and as Martin Alcock noted, it will be disappointing to many that the revised timetable from the CAA has now resulted in a significantly shorter notice period than was originally proposed in the consultation.

What do you think? Let us know your thoughts in the comment space below. 

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This Atol scheme has been plagued by delays, and the latest news will likely come as little surprise to the trade. As experts have noted however, these new financial tests will represent some of the biggest changes to the Atol scheme in recent years and have the potential to have profound effect on many SBAs and small standard Atol holders - it is therefore of course important that the CAA does not rush through the changes.

 

That said, perhaps more realistic time frames should have been offered in the first place, and as Martin Alcock noted, it will be disappointing to many that the revised timetable from the CAA has now resulted in a significantly shorter notice period than was originally proposed in the consultation.

What do you think? Let us know your thoughts in the comment space below. 

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